Mining boom strains supply chain firms

from theaustralian.news.com.au

THIS week’s shock profit downgrade by engineering group Bradken, just weeks after it painted a rosy outlook, epitomises the knock-on effects the mining boom is having on companies exposed to supply-side constraints such as tight labour market conditions, major rail and port bottlenecks and a rapidly strengthening dollar.

While Bradken’s downgrade was partly due to a poor contract in its powder and cement division, and delays in the ramp-up of a new Chinese facility in its rail division, chief executive Brian Hodges also blamed bottlenecks for a slowdown in its mining and mineral procession division.

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