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CeMAT Singapore – 2025’s Leading Destination

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CeMAT Australia is one of the first dates circled on the calendar by manufacturers in the intralogistics, robotics and automation, warehousing, supply chain management and materials handling sectors. Their sister event, CeMAT Southeast Asia, has also become a fast favourite with businesses that deal extensively with our near neighbours to the north, with 2024’s edition the most popular yet among those that travelled to Singapore. The good news is that the event is returning for 2025 in the same location, going for a second year straight in Singapore after previously using Mumbai and Jakarta as locations. The event will be held at Singapore EXPO from 19-21 May 2025, with registration for exhibitor stands now open.

According to Mike Nissen, Commercial Director at organisers Hannover Fairs Australia, Singapore is the obvious place for such an important manufacturing meet-up to be held. “Singapore is the hub of logistics in Southeast Asia,” he explained to Industry Update. “It’s the benchmark in automation in intralogistics and supply chain for that region, and while you do have emerging markets like Indonesia, Thailand, Philippines and Vietnam they generally look to Singapore. You’ll find a lot of the APAC headquarters for the large integrators and supply chain suppliers in Singapore.” Singapore is one of Australia’s major trading partners, a nation known for its ease of doing business and, crucially, a favourite with our steel fabrication Australia sector going back decades. “Australia generally has very good trade relations with a lot of those Southeast Asian countries,” said Nissen.

For Singapore, in particular, Australia has a long history of free trade agreements. CeMAT Singapore was very well received in 2024 at our first show there. “We had about 7000 visitors, but it was the quality of visitor that attended the event that stood out – we had a lot of what we call our tier one exhibitors. They were suitably impressed; they supported the event and so it’s here to stay.” CeMAT Singapore presents a chance for Australian manufacturers to interact with the huge Chinese sector that is increasingly making things in Southeast Asia and to learn about the huge advances in AI adoption in supply chain management that are taking place in the region. “You’ve got this burgeoning trend where China is looking to manufacture outside of their borders, and Southeast Asia is one of their key markets,” said Nissen.

“The whole supply chain and logistics side is also upskilling to go with that, with automation coming in. Where once that would have been factory or warehouse workers, now it is automation and robotics. The critical point, particularly with Southeast Asia and especially Singapore, is space. Whether it be manufacturing, warehousing or mining plant and equipment Australia, space is a considerable issue. Australia, for example, is rather urbanized, but Southeast Asian countries and cities are incredibly densely populated and require maximum space utilisation. That’s where I think the automation side in this tighter space is really coming into fruition. It’s an opportunity to use space to the maximum. There’s AI-backed technology that will get into every centimetre of a facility space and make sure that efficiency is 100%. Another aspect is the cold chain. Being Equatorial countries, there are goods like in pharmaceuticals and Food & Beverage that need temperature-controlled environments.” said Nissen.

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Advanced Analytics in Manufacturing Logistics

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Data is a crucial part of manufacturing logistics. But how does one go beyond inventory management, order fulfillment, and transportation metrics to gain deeper insights? Advanced analytics allow a company to delve deeper into its manufacturing processes, identify risks and opportunities in its supply chain, and turn information into strategic decisions. Guided by real-time data, Internet of Things (IoT), artificial intelligence (AI), and GPS, advanced manufacturing analytics are changing the way businesses monitor, improve, and streamline their operations. Let us deep dive into this interesting topic.

 What are Advanced Analytics?

Advanced analytics are more precise metrics and data-gathering methods that enhance supply chain visibility and performance. It relies heavily on big data, machine learning, and AI to deliver faster, more accurate insights to managers. Through advanced technology, companies are able to identify trends and risks more easily. With a more agile framework, logistics managers are then able to optimize their supply chains and enhance their strategies via a digital supply chain to deliver faster, more cost-effective results to their customers.

Some ways a company might use advanced analytics in manufacturing logistics include:

  • Predicting consumer behavior and forecasting demand
  • Monitoring and reporting market trends and economic turns
  • Enhancing overall equipment effectiveness (OEE) through root cause analysis
  • Improving time management through historical data analysis
  • Using real-time data to enhance quality control and regulatory compliance

Boosting Supply Chain Efficiency

Implementing advanced analytics into supply chain management ultimately leads to more informed decisions that yield better outcomes. One of the biggest struggles logistics managers face is justifying their supply chain decisions to executives and shareholders who think from an ROI standpoint. Data talks, and when a logistics manager can clearly illustrate the benefit of their strategies to leadership, the entire company benefits. Ultimately, advanced analytics create a more controlled supply chain for processes such as pipe fabrication Australia. Traditionally, companies that lacked substantial vertical integration were limited to their suppliers’, vendors’, and distributors’ own schedules. But with more refined technology and data, they can begin to optimize their own processes and communicate their needs more effectively with their supply chain partners.

Data Integration and Data Structures

Data integration can have technical challenges that ultimately delay management from implementing newer technologies into their supply chain. Data integration ultimately gives the steel fabrication Australia team a unified view of all the data it collects, ensuring the manufacturer is able to glean as much insight as possible from the findings. Understanding these challenges ahead of time can help ease doubts or wariness from executives, develop a strategic implementation plan, and start leveraging data effectively from day one. When one combines various types of data, such as IoT, AI, and quality management systems (QMS), synthesizing all that information into one cohesive format can feel overwhelming. Companies must consider the various data structures, formats, and protocols that each system uses, then determine how they will effectively merge them into a cohesive analytical framework. Working with a skilled logistics company is the best way to ensure that manufacturing data converges at all the right points. This gives the manufacturer the greatest insight into operations and provides maximum value.

What’s Next?

Predictive analytics will leverage the power of adopting AI in supply chains to generate optimal benefits. Businesses that use predictive analytics will be able to mitigate risks more effectively, develop more effective optimizations, and create a more efficient supply chain. Due diligence is essential to ensure that a manufacturing company covers all of its legal bases before integrating new data collection or analytical technologies. For many businesses, “advanced analytics” may sound like an intimidating concept, but in reality, it is the process of leveraging the best technology available to enhance what the manufacturer already does well. Through advanced manufacturing logistics, companies are able to transform their current data into meaningful metrics that go from being mere observations to actionable insights.

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Modern Slavery Clauses in Australian Manufacturing

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At first glance, modern slavery does not seem to be an issue facing Australian manufacturers. But the statistics prove otherwise. The Australian government estimated that there could be between 1,300 – 1,900 people in conditions of modern slavery in Australia at any given time. The manufacturing sector is considered high-risk due to its supply chain complexities and reliance on migrant labour. Australia’s Modern Slavery Act 2018 requires heavy steel fabrication companies with annual consolidated revenue of more than $100 million to report annually on the risks of modern slavery in their operations and supply chains, and actions taken to address those risks. So, how are slavery clauses incorporated in agreements? Let us find out in this blog.

Need and Types of Modern Slavery Clauses

The policy in the Modern Slavery Act is to develop, improve and maintain responsible and transparent supply chains. Notably, the Act requires that businesses subject to it report on their due diligence and remediation processes for preventing and addressing modern slavery practices in their supply chains. Contracts may help businesses satisfy these obligations. Agreements with enforceable modern slavery clauses may also assist businesses with resisting litigation and reputational harm.

In practice, the drafting approaches for addressing modern slavery in supply chains vary widely. Many contracts between buyers and suppliers include a supplier code of conduct which may address modern slavery. Other drafting approaches include bringing warranties and representations into the contract, importing standards, or obliging a supplier to become a member of a group with prescribed supply chain management requirements which also improves manufacturing traceability. The common feature of these approaches is that they put the onus on the supplier. Consequently, these approaches are problematic because they ignore that the buyer’s purchasing practices may significantly contribute to modern slavery and human trafficking violations. These abuses include aggressive pricing, tight delivery schedules, belated changes to pipe fabrication Australia order quantities, late orders, inaccurate product specifications and forecasting of production needs, lack of support for the supplier, and failures to incentivise elimination of modern slavery in the supply chain.

Alternative Drafting Solution

A good alternative to weighing obligations on the supplier requires that, as part of metal fabrication marketing and sales, both the purchaser and the supplier maintain a human rights due diligence process. While this approach may still impose supplier representations and warranties, it also binds the buyer to responsible purchasing practices. This may include binding the buyer to a responsible purchasing code of conduct and providing for supplier termination if, through the purchasing, modern slavery is unavoidable in the supply chain. A comprehensive treatment of this alternative approach has been provided by the Working Group of the Business Law Section of the American Bar Association. Along with better sharing obligations between the supplier and purchaser, this approach helps reporting entities address their obligation under the Act by describing their due diligence and remediation processes for preventing and addressing modern slavery practices in their supply chains.

Closing Thoughts

It is necessary to recognise the signs of modern slavery. They can include apparent restriction of movement, signs of physical or psychological abuse, fear of authorities, lack of control over earnings, and retention of identity documents by someone else. Section 16(1)(c) of the Modern Slavery Act requires that the reporting entity describe the risks of modern slavery practices in its operations. the reporting entity often must do an initial scoping exercise to identify and describe the modern slavery risks. It remains essential to do this scoping exercise before embarking on the actual contract negotiations and drafting. The Australian Government has published guidance on this initial scoping exercise.

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The Digital Supply Chain

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The ability to streamline operations and improve efficiency are crucial aspects of operating in dynamic manufacturing markets. For manufacturers involved in and affected by global and local operations and logistics, the pressure is felt in future-proofing supply chains. Supply chain management (SCM) involves complex, multifaceted processes that demand precision, foresight, and adaptability. Enter the power of artificial intelligence (AI) and digital technologies, which are transforming how supply chains operate. The integration of AI in supply chain processes and the adoption of comprehensive supply chain management software are not only ongoing trends, but important strategies for companies seeking to be more efficient, stay competitive, and innovative. This blog deep dives into this exciting topic in greater detail.

Key Components of Digital Supply Chain

There are certain key components that are essential within establishing a digital supply chain:

  • Comprehensive SCM Solutions: Supply chain management software is at the heart of the digital supply chain, offering a suite of tools that facilitate resource and supply planning, demand management, inventory management, order promising, and more aspects. These integrated solutions allow businesses to manage complex logistics networks efficiently, synchronise supply with demand, and optimise resource allocation and distribution. By automating and streamlining critical supply chain operations, SCM software plays a crucial role in enhancing the agility and resilience of business operations.
  • Cybersecurity: As supply chains digitalise, the cyber status of manufacturing become crucial to protect data integrity and prevent disruptions. Ensuring secure data flows and protecting against cyber threats are imperative to maintain the reliability and trustworthiness of the digital supply chain.
  • Connectivity and Integration: SCM software integrates with other manufacturing and operational software systems (e.g. MOM or ERP), as well as IoT devices. This connectivity ensures that supply chain managers and executives have full visibility and control over their supply chain. The integration facilitates real-time data collection and sharing across various platforms, enabling a unified view of operations, and helping decision-makers to respond swiftly and effectively to any operational challenges or opportunities.

Development of Digital Supply Chain

The 3 major trends that manufacturers need to watch and potentially integrate into their operations are as follows: –

  • Firstly, the future of supply chain management heavily relies on predictive and prescriptive analytics. These technologies go beyond traditional descriptive analytics by not only predicting future scenarios but also suggesting course actions that enhance manufacturing traceability. By utilising machine learning algorithms and big data, supply chain managers can anticipate issues before they arise and prescribe the best strategies to mitigate risks or take advantage of upcoming opportunities.
  • Secondly, sustainability is becoming a cornerstone in supply chain strategy, driven by consumer demand, regulatory requirements, and a corporate responsibility toward environmental stewardship. AI can play a significant role in enhancing sustainability efforts by optimising routes to reduce fuel consumption, improving inventory accuracy to decrease waste, and facilitating the recycling of materials. As manufacturers strive to meet their sustainability goals, AI provides the tools necessary to achieve these objectives in an efficient and cost-effective manner.
  • Finally, hyper automation, a trend that builds on the foundations of robotics and AI automation, involves the orchestrated use of multiple technologies to automate as many manufacturing processes as possible. In supply chains, hyper automation could mean automated systems for handling heavy products like pressure vessels, managing warehouses, and planning deliveries, all connected through a central AI that continuously learns and improves these operations.

Looking Ahead

The digital transformation of supply chains through AI and advanced SCM software solutions is not just a trend but a necessary evolution in today’s business environment. Manufacturers that are quick to adopt these technologies gain significant advantages, enabling them to outperform competitors and meet the increasing demands of consumers and markets more effectively. From predictive analytics that forecast future trends and optimise operations in areas such as mining plant and equipment Australia, to AI-driven automation that enhances efficiency and accuracy, the role of technology in supply chain management has never been more crucial. Now is the time for forward-thinking leaders to embrace these innovations and transform their supply chain operations into more responsive, efficient, and customer-oriented systems. Investing in digital supply chain solutions is not merely about keeping up with technological advancements but about setting the stage for continued success in an increasingly complex global marketplace!

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AI Adoption in Supply Chains

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Modern supply chain management is experiencing revolutionary technological changes that transcend traditional production methods. Software companies are pioneering these changes by developing AI solutions for areas of concern and ensuring adequate supply chain operations. From planning production schedules and managing inventory to enhancing demand predictions and optimizing shipments of products such as pressure vessels, leveraging AI can refine tasks across the board. Applying this level of innovation guarantees efficiency, reliability, and accuracy, permitting staff to focus on transforming the AI’s findings into meaningful action steps. This blog delves into this exciting topic in greater detail.

Transforming Demand Forecasting

Growing geopolitical tensions cause supply chain companies to face heightened levels of uncertainty, especially when predicting upcoming product demands. Advanced AI algorithms analyse large datasets in real time to anticipate inventory and market changes and helps in future-proofing supply chains. They use current market trends, historical consumer patterns, and economic factors. Utilizing these results can prevent stockouts and overstocking, which improves your company’s cost-effectiveness. It can also streamline the shipment process and respond faster to setbacks, mitigating issues of timely deliverables to customers. Traditional methods primarily focused on past performances rather than future ones, but AI specializes in predictive analytics across all industries, not just supply chains. AI models are simply more agile and adaptable than traditional analytics, which require frequent manual updates. With an ever-evolving system constantly teaching itself to perform sufficient calculations, supply chain experts can rest assured that this technology is not overlooking complex data patterns.

Planning and Optimization

Depending on a company’s specific needs and areas of improvement, AI can significantly impact supply chain planning and overall optimization. AI systems can track material and warehouse capacity limits to meet demands. They can also prioritize tasks like order fulfilment, inventory and storage updates, risk management, and supplier communication. One transformative approach is utilizing AI automation. Mundane, manual tasks like data entry are not always quick and easy. These tedious but necessary duties consume much of employees’ time, taking their attention away from critical projects. Substituting human intervention with AI. such as introducing AI video surveillance, to perform these assignments could allow the team to devote more time to planning and structuring.

Barriers to AI Adoption

Arguably, one of the most significant barriers that prevent supply chain companies from using AI systems is the lack of AI knowledge within an organization. It is a classic case of “blissful ignorance,” which is why it is essential to start educating leaders on the powerful advantages of implementing AI. Highlighting benefits like improved cost-effectiveness, optimized proficiency, and reduced resources could lead them to embrace the latest evolution of workplace technology. Bergur Thormundsson, a research expert with Statista, published a survey where 600 senior technology personnel at supply chain companies were asked about AI usage. Roughly 38% said integrating AI into their operations will be critical by 2025. Augmenting different roles could result in employees carrying out new hybrid structures, improving productivity, and acquiring more skills, which could increase growth opportunities. For all these reasons, organizations must overcome barriers when they’re initially trying to apply AI-driven solutions.

What’s Next?

Supply chain companies underwent many production and inventory setbacks within the past five years. Labor shortages, geopolitical conflicts, cybersecurity, unreliable suppliers, and fluctuating demands of pipe fabrication Australia were some of the most prevalent obstacles. AI solutions are combatting these disruptions. In cybersecurity, for example, AI algorithms can detect and prevent potential cyber threats by optimizing data security. They also track usage patterns to enhance data encryption and identify fraudulent activity. AI adoption is becoming a standard within supply chain management, and its integration will not slow down anytime soon!

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Power of Manufacturing Traceability

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In a manufacturing landscape defined by rigorous standards, emerging technologies, and customer demands for exceptional quality, traceability has become a paramount necessity. Regulatory bodies worldwide enforce stringent controls and conduct frequent audits, making it imperative for manufacturers to have a handle on every facet of their production process. Overlooking risks could result in severe penalties and damaging recalls. The blog explores how traceability functions as the lifeline of today’s highly regulated industries and how it can be harnessed to effectively neutralize product recall risks.

Grave Impact of Product Recall Risks

In industries such as aerospace, automotive, medical devices and pipe fabrication, the stakes are invariably high due to the extreme levels of regulations governing them. The term “recall risks” is, hence, a menacing phrase that sends a ripple of unease through these sectors. The reasons for these jitters are multifold. A product recall – arising due to factors such as non-compliance with the set standards, product defects, or quality control issues — can be an immense logistical challenge, leading to significant financial drain and irreparable damage to your brand’s reputation and consumer trust.

Rise of Traceability in Manufacturing

In the face of such daunting challenges, traceability in manufacturing proves to be a formidable ally. In the pre-traceability era, manufacturers faced the herculean task of maintaining comprehensive oversight over their entire production line and supply chain. However, the incorporation of traceability components within a Manufacturing Execution System (MES) solution marks a paradigm shift in this scenario. These components empower you with real-time, transparent visibility into every stage of production — from sourcing raw materials, through tracking materials down to single piece and its entire history and lot information and associating that without error to each final end-unit produced. This granular insight enables you to swiftly identify potential issues and drive quality management. As a result, it minimizes the risk of product recalls, thus circumventing the associated financial losses and reputational damage.

Core Traceability Components

Understanding the manufacturing execution system benefits, particularly the value of traceability components, can substantially alleviate risks. Let us delve deeper into these features:

  1. Real-time data capture and visibility.

Data is the backbone of traceability, providing the means to track, verify, and document the entire lifecycle of products or materials. The ability to easily capture and retrieve data in real-time and present it in an easy-to-understand manner is a significant advantage offered by modern MES solutions. Real-time data capture and visibility via AI video surveillance means you can swiftly spot and rectify issues, whether it is an equipment failure, a sudden spike in defect rates, or a drop in production efficiency. This immediate identification and resolution of issues often prove crucial in preventing expensive recalls.

  1. Detailed audit trails.

In a highly regulated environment, having a detailed and accurate record of every operation and transaction is critical. Audit trails provided by MES solutions ensure that every movement of goods, every adjustment in parameters, and every quality check is recorded and easily retrievable. These digital ‘paper trails’ simplify the process of inspections and audits. By highlighting exactly where a defect or non-compliance occurred, audit trails help in swift recall management, saving precious time and resources.

  1. Supplier quality management.

The role of suppliers in future-proofing manufacturing supply chains is undeniable. The quality of raw materials sourced from suppliers can significantly impact the final product’s quality. Therefore, having robust inspection, data capture, and analytics is essential. The right MES solutions can enable you to closely monitor the quality and compliance of raw materials and your suppliers. This proactive approach helps minimize the risk of introducing defects or non-compliance issues into the production process, thereby mitigating recall risks.

The Last Word

In a rapidly changing manufacturing landscape marked by stringent regulatory norms and high consumer expectations, recall risks present an ongoing challenge. By deploying advanced traceability measures, you can fortify your operations against potential setbacks. As discussed above, the stakes are high in the highly regulated manufacturing and steel fabrication Australia sector. The potential risks emanating from product recalls (such as pressure vessels) are not merely financial but can significantly damage a company’s reputation and customer trust. However, armed with robust traceability capabilities, in a modern MES platform, you can navigate this precarious path with increased confidence.

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Manufacturing Evolution Over Last Five Years

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The manufacturing industry has undergone significant transformation over the past five years, marked by technological advancements, shifting global dynamics, and evolving consumer preferences. From the rise of Industry 4.0 to the challenges posed by geopolitical uncertainties and the COVID-19 pandemic, manufacturers have navigated a rapidly changing landscape. In this blog, we delve into key trends and developments that have shaped the manufacturing sector over the last half-decade, highlighting both challenges and opportunities that have emerged.

Embrace of Industry 4.0 Technologies

Industry 4.0 Technologies

The past five years have witnessed a widespread adoption of Industry 4.0 technologies across the manufacturing sector. From advanced robotics and automation to Internet of Things (IoT) devices and artificial intelligence (AI), manufacturers have embraced digital transformation to enhance efficiency, productivity, and flexibility. Smart factories equipped with interconnected systems and data analytics capabilities have revolutionized production processes, enabling real-time monitoring, predictive maintenance, and agile manufacturing.

Reshoring and Supply Chain Resilience

Reshoring and Supply Chain Resilience

The COVID-19 pandemic exposed vulnerabilities in global supply chains, prompting many manufacturers to reconsider their sourcing strategies. Over the last five years, there has been a trend towards reshoring and nearshoring as companies seek to mitigate risks associated with disruptions and strengthen post-pandemic supply chains. Building resilience into supply chains through diversification, localization, and closer collaboration with suppliers has become a priority for manufacturers looking to enhance agility and responsiveness to market fluctuations.

Sustainability and Circular Economy

Environmental sustainability has emerged as a key focus area for the manufacturing industry in recent years. With increasing awareness of climate change and resource scarcity, manufacturers are embracing sustainable practices to minimize environmental impact and meet regulatory requirements. The concept of the circular economy, which aims to reduce waste and maximize resource efficiency through recycling and reuse, has gained traction within the manufacturing sector. Companies are investing in eco-friendly technologies such as heat induction bending services, renewable energy sources, and closed-loop systems to minimize waste generation and carbon emissions.

Resilience Amidst Disruptions

Resilience Amidst Disruptions

The manufacturing industry has faced numerous disruptions over the past five years, including trade tensions, natural disasters, and the COVID-19 pandemic. These disruptions have underscored the importance of resilience and adaptability in manufacturing operations. Heavy steel fabrication companies that have invested in digitalization, supply chain visibility, and risk management have been better equipped to weather the storm and pivot swiftly in response to changing market conditions. The ability to anticipate and mitigate risks will continue to be critical for manufacturers in the years ahead.

Skills Gap and Workforce Development

As manufacturing becomes increasingly digitized and automated, there is a growing need for a skilled workforce capable of leveraging advanced technologies. However, a widening skills gap has been a challenge facing the metal fabrication industry, with shortages of workers trained in STEM (science, technology, engineering, and mathematics) disciplines and digital skills. Over the last five years, manufacturers have ramped up efforts to address this challenge through investments in workforce training, apprenticeship programs, and partnerships with educational institutions. Building a talent pipeline equipped for the demands of modern manufacturing will be essential for future growth and innovation.

Closing Comments

The past five years have been transformative for the manufacturing industry, characterized by technological innovation, supply chain disruptions, and a heightened focus on sustainability and resilience. As manufacturers navigate the challenges and opportunities of a rapidly evolving landscape, adaptability, agility, and forward-thinking will be key to driving success in the years to come. By embracing digitalization, prioritizing sustainability, and investing in talent development, manufacturers can position themselves for continued growth and competitiveness in an ever-changing global marketplace.

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Biden Demands “Serious Scrutiny” Of US Steel Sale

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President Joe Biden believes “serious scrutiny” is warranted for the planned acquisition of U.S. Steel by Japan’s Nippon Steel, the White House said Thursday after days of silence on a transaction that has drawn alarm from the steelworkers’ union. Lael Brainard, the director of the National Economic Council, indicated the deal would be reviewed by the secretive Committee on Foreign Investment in the United States, which she participates in and includes economic and national security agency representatives to investigate national security risks from foreign investments in American firms. She said in a statement that Biden “believes the purchase of this iconic American-owned company by a foreign entity — even one from a close ally — appears to deserve serious scrutiny in terms of its potential impact on national security and supply chain reliability.” “This looks like the type of transaction that the interagency Committee on Foreign Investment Congress empowered and the Biden administration strengthened is set up to carefully investigate,” she said. “This administration will be ready to look carefully at the findings of any such investigation and to act if appropriate.”

Under the terms of the approximately $14.1 billion all-cash deal announced Monday, U.S. Steel will keep its name and its headquarters in Pittsburgh, where it was founded in 1901 by J.P. Morgan and Andrew Carnegie. It will become a subsidiary of Nippon. The combined heavy steel fabrication company will be among the top three steel-producing companies in the world, according to 2022 figures from the World Steel Association. Chaired by Treasury Secretary Janet Yellen, the CFIUS screens business deals between U.S. firms and foreign investors and can block sales or force parties to change the terms of an agreement for the purpose of protecting national security. The committee’s powers were significantly expanded in 2018 through an act of Congress called the Foreign Investment Risk Review Modernization Act, known as FIRRMA. Last year, U.S. Steel had dropped a National Labour Relations Board complaint against United Steelworkers. In September, President Biden issued an executive order that expands the factors that the committee should consider when reviewing deals — such as how the deal impacts the U.S. supply chain or risks to Americans’ sensitive personal data. It has on some occasions forced foreign companies to divest their ownership in American firms.

United Steelworkers International, which endorsed Biden’s 2020 presidential campaign, swiftly opposed the new transaction. The union “remained open throughout this process to working with U.S. Steel to keep this iconic American company domestically owned and operated, but instead it chose to push aside the concerns of its dedicated workforce and sell to a foreign-owned company,” said David McCall, president of United Steelworkers, in a statement after the transaction was announced, adding that the union was not consulted in advance of the announcement. “We also will strongly urge government regulators to carefully scrutinize this acquisition and determine if the proposed transaction serves the national security interests of the United States and benefits workers,” he added. Political allies of Biden in Pennsylvania — a presidential battleground state that is critical to his re-election campaign — also objected to the sale this week, and released statements pressing Nippon to make commitments to keep U.S. Steel’s workers, mining plant and equipment, and headquarters in the state. Democratic U.S. Sen. Bob Casey said it appeared to be a “bad deal” for the state and workers, while Democratic U.S. Sen. John Fetterman — who lives across the street from U.S. Steel’s Edgar Thompson plant just outside Pittsburgh — said he will attempt to prevent the sale based on national security issues.

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Future-proofing Supply Chains

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As discussed in a previous blog on post-pandemic fabrication supply chain, the COVID years were harrowing for supply chains with the imminent threat of lockdowns creating volatility in demand and supply patterns. With the return to normalcy, the future of global logistics has become significantly brighter — however there are lessons to be learnt during the pandemic and which should be avoided in case of a similar situation in the future. There is a gradual realization that many forces need to be considered when creating truly resilient, dynamic supply chains. So, what are these forces and how should they be leveraged correctly? This writeup looks to decode this subject in greater detail.

 Supply-Demand Mismatch

In a perfect world, supply and demand sync evenly but in the real world, often one outpaces the other – such as the shortage of certain consumer goods of 2020. Oversupply can also cause issues which can pile up and quickly eat through a business’ bottom line. A common issue is where to store the overstock and how to continue to sell it and profit, and this can cause issues up and down the supply chain of heavy steel fabrication companies. These pockets of exponential demand will continue to exist as will moments of oversupply. Both need to be built into forecasts to help stakeholders better manage inventory and adapt as forces shift the balance.

Commodity Shortages

Commodities like lithium and cobalt are in high demand but not always easy to procure. Producers that need hard-to-replace materials must factor in forces such as potential tariffs, weather patterns, upcoming environmental regulations, and variable pricing of mining plant and equipment to ensure production does not suffer. The emergence of innovative design is a trend which can be used to resolve shortages. Engineers are using smaller geometries, so the required amount of the given commodity is reduced without sacrificing product capability. An example would be the small size of computers today compared with earlier days when they were the size of a room and exponentially less powerful.

Economy and Pricing

The state of the economy is a major factor which is a bell weather for consumption trends, such as using local steel companies in Australia. With rising inflation, consumers are looking to spend less but still get that bang for their buck — and that translates all the way up the chain. At the same time, between labour, the rising cost of materials, tariffs, and more, suppliers are getting squeezed on cost. While there will never be a perfect model for economic forecasting, knowledge of known forces and their impact on consumer behavior can be built into pricing projections.

Labour Shortages

Forces such as labour shortages always impact product availability. For instance, Japan needs more than 200,000 engineers in the next couple of years to maintain current production levels. In 2030 it is expected that Japan will not be able to fill 270,000 artificial intelligence and IoT jobs. One of the drivers of this trend is ageing populations. The engineers who have been designing and building components worldwide are now retiring and there are fewer people available to fill those gaps. Not only is there an inverted population pyramid at play here, but the increased need for these products is driving up the demand and exacerbating this skill gap. Consider how many things require technologies that did not exist even 10 years ago. The demand is going to skyrocket, which means even more engineers and IT professionals will be needed going forward.

Final Thoughts

In the context of future planning for supply chains, none of these forces are new but the need to accurately build them into supply chain forecasts is increasingly important. The pandemic helped highlight the need to take all these forces into account to ensure that disruptions are limited when a black swan event occurs. Hence, supply chains are ever-evolving and it is up to us to keep pace with its evolutionary development!

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Post-Pandemic Fabrication Supply Chain

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The COVID-19 pandemic had led to the disruption of the fabrication and manufacturing supply chain. First came the supply shock, where many fabricators dealt with canceled orders not from lack of demand but because manufacturers could not get other needed parts for the final product. Then came the second punch, this time on the demand side, as unemployment spiked dramatically. manufacturers reacted by reducing or halting orders altogether. Now that the severity of the pandemic has considerably diminished, there is expected to be an evolution of the metal fabrication supply chain. There may be new trends and factors coming up in this regard, and this blog will look to deep-dive into this topic.

Transparency

Supplier management and optimization is a critical requirement in supply chain management since one would want the plumbing set up for multiple supply chains so that one can turn on the faucet here or there, depending on the timing. To do that in some cases, manufacturers reduced the number of faucets (suppliers) to just a few large, highly reliable ones. This in part has helped make some of the largest heavy steel manufacturing companies even larger. The COVID-19 crisis might spur more dual sourcing. If the disease reemerges in a certain locale and everyone at a certain plant needs to go home, will another supplier elsewhere be able to pick up the slack? Such dual sourcing might add a bit of supply chain complexity which is a challenge facing the metal fabrication industry. It goes back again to supply chain transparency, not just between a fabricator and its customer, but also wherever value is added within the entire supply chain. Manufacturers might accomplish this in various ways, one of them being by contracting directly with the lower-tiered suppliers, including metal fabricators. Fabricators might still send welded components to an assembler, which then sends them on to the manufacturer. But the assembler might act simply as a toll processor. In this sense, the supply chain would evolve into a kind of network.

Reshoring and Tracking Financial Health

Overseas work has been coming back from Asia for years, and the steel tariffs of 2018 and the COVID-19 pandemic have accelerated those efforts. According to a survey, 64% of manufacturing and industrial companies are likely to nearshore or reshore because of pandemic-related concerns. In that same survey, 53% of businesses reported difficulty receiving COVID-related supply chain information from their Chinese suppliers. A change in geography does change the risk level, however, supplier location is only a piece of the puzzle. Transparency is still the name of the game. An opaque supplier relationship can have negative consequences, whether that supplier is down the street or an ocean away.

Transparency will include information related not only to where components are in the supply chain, but also the financial health of suppliers. An audit might give a snapshot of a supplier’s liquidity, leverage, efficiency, savings due to process automation, and access to cash. But how will this financial situation change over time? Again, demand for such transparency has been building for years, especially in certain industries.

Make vs. Buy

The COVID-19 pandemic is likely to enable more make-versus-buy analyses and evaluations. The variables in the make-versus-buy decision will remain the same, including available suppliers, shipping logistics, and the nature and mix of products being manufactured. But the potential of disease outbreaks or other external shocks around the globe will lead more companies to further scrutinize their decisions. It is likely that the pandemic will not lead to some massive vertical-integration movement. Bringing in a process that is too far outside a manufacturer’s wheelhouse still will not be practical in many cases. This will be particularly true with processes that require certain expertise, like high-end welding and other specialty fabrication processes such as development of pressure vessels.

The Last Chapter

COVID-19 has tested the agility of industrial supply chains. As the economy picks up in a post-pandemic world, it is essential to ensure that the lessons learnt during those hard times are not lost, but used to drive innovations in supply chains going forward. As the saying goes, a chain is only as strong as its weakest link and supply chains need to iron out their shortfalls to emerge stronger in the long run!

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