Bricks giant in supply warning
THE boss of the nation’s biggest brickmaker, which churns out more than 750 million bricks a year, says global supply chains and shipping routes are so crippled by the pandemic his factories came within weeks of running out of the pigment used to colour bricks.
Brickworks chief executive Lindsay Partridge has revealed the shockwaves now running through the economy and Australian industry caused by disrupted supply chains and logistics that is generating shortages in labour, materials and even the chemicals used to stain bricks.
“We have been touch and go on the supply, we were close a couple of times to running out of things like manganese dioxide, a stain that makes bricks brown or black,” Mr Partridge said. “We had to build up supplies just to keep ourselves going.”
Mr Partridge is also warning of an undersupply of bricklayers in Western Australia and South Australia, as well as truck drivers, and that his own kilns and plants were consistently running short of as many as 50 essential workers, from forklift drivers to managers.
He also fears last week’s collapse of Brisbane-based home construction company Privium will not be the last, as builders that have fixed contracts but face skyrocketing labour and building products costs – such as timber and cement – will be chained to construction projects that will be mired in losses. He expects a spate of builders to collapse in the new year.
Mr Partridge said after the Brickworks annual general meeting on Tuesday that the slowdown and delays of international shipping, as well as general disruptions to the global supply chain, had almost starved the company of the chemicals it needs to put colour into its bricks.
“We were a couple of weeks (from running out) and otherwise you’d be lucky to have had any colour of brick you liked as long as it was red! And that is not good marketing.”
Brickworks, which manufactures a range of building materials, had previously bought its manganese dioxide supplies from Groote Eylandt in the Gulf of Carpentaria, but now imports it from South Africa and had struggled to get shipments out in time as the pandemic spread.
Prices for these supplies had also been lifting rapidly, pinching earnings.
“Anything we import from overseas has gone up dramatically, like cement or dioxide,” he said. “The cost of bulk shipping for bringing in cement has gone up fourfold.”
At the AGM, Brickworks warned of “cost pressures across the supply chain” for its burgeoning US bricks business amid transportation disruptions, labour shortages and higher wages.