Aug 13, 2010
New China-based facility aims to increase global competitivenessBack
© Reuse this
The move to open a facility in China comes in light of the company’s reduced global competitiveness, owing to the continued strong performance of the rand. VR Steel MD John van Reenen explains. “I estimate that the rand is currently being overvalued by about 30%, translating into higher local manu- facturing costs,” he says.
The company specialises in the construction of dragline buckets, hydraulic and rope shovel buckets, and truck bodies with capacities of up to 350 t. Van Reenen adds that locally ordered products for Southern Africa will, however, continue to be manufactured at the company’s Alrode facility, in Alberton, while products for the Australasian and Asian markets will be manufactured at the new facility in China. The company is also represented in the US and in Canada.
VR Steel reports that it had a long association with a Chinese steel products manufacturing firm before deciding to establish its own facility. The Chinese facility will be mainly engaged in constructing truck bodies for Chinese mines, dragline buckets and rope shovel buckets for export, while its South African facility mainly constructs bodies for large trucks for mining companies, as well as all VR Steel’s other products for sale in Southern Africa.
Meanwhile, VR Steel has fabricated the largest rope shovel bucket in the world, weighing in at 89 t. It will be used at a coal mine in China’s Shanxi province.
Further, Van Reenen explains that VR Steel has developed some of the most advanced design software in the world. “After considering existing software to design buckets and truck bodies, we have developed our own to suit our particular needs,” he says.
The company is able to simu- late soil movement within a bucket to the smallest detail. The software can simulate up to 5 000 different particle sizes entering and leaving a bucket, and programmes often run for weeks to simulate only about 15 seconds of a bucket movement.
Further, VR Steel uses spe- cific quenched and tempered steel, imported through steel manufacturer Swedish Steel, to construct its products. This helps to make the products more durable to meet the demands of tough working conditions, often being used continuously for digging in the earth.
“We examine a specific mine’s blasting practice to determine the thickness of the steel to be used in a design. The blasting is a big factor in determining the severity of the wear the equipment will experience,” he says.
During the construction of mining equipment, VR Steel cuts and bends steel to the required shapes by using 1 250-t- and 1 500-t-capacity presses. The company tries to reduce the use of welding on its products, making its products stronger. Welding is reserved for the less stressed areas of the products.
Van Reenen points to the importance of constructing mining equipment to the high- est possible standards, as it has to withstand continuous hammering from very abrasive environments. Dragline buckets are used mainly where coal is found in relatively flat seams, close to the earth’s surface, while rope and hydraulic shovel buckets are used where more undulating seams of minerals are encountered.
Further, the company reports that it is still struggling to escape the severe effects of the recession. Van Reenen says that the company’s profits decreased by 50% during 2009, and, during 2010, profits were down by a further 70%. However, there is potential improvement, as the company order book has seen a significant increase for the rest of the year and into 2011.
“I believe many mines are reaching the stage where their equipment is nearing the end of its service life, prompting new capital investment for its replacement. We expect a significant upturn in the manufacturing industry, as there are many new mines starting operations in Africa in the foreseeable future, as well as renewed activity in the platinum- and diamond-mining industries,” Van Reenen concludes.
Edited by: Brindaveni Naidoo© Reuse this Comment Guidelines (150 word limit)
Other Materials-Handling and Logistics News
While dust prevention can be used in materials handling operations, dust suppression is the preferred option, owing to low water consumption, especially in areas where water is scarce, says dust-control company Dust-A-Side. Other benefits of using dust suppression...
Global lifting solutions provider Konecranes has rehabilitated two 500 t Chinese portal cranes for the Angolan National Oil Company’s (Sonangol’s) Integrated Logistic Services’ (Sonils’) oil service centre, says Konecranes Southern Africa technical and training...
Distributed by local earthmoving equipment distributor High Power Equipment Africa (HPE), automotive manufacturer Hyundai’s backhoe loaders have been well received by the local market, says HPE, the sole distributor of Hyundai earthmoving equipment in Southern...
Recent Research Reports
Water 2015: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2015 Report considers the aforementioned issues, not only in the South African context but also in the African and global context in terms of supply and demand, water stress and insecurity, and access to water and sanitation, besides others.
Input Sector Review: Pumps 2015 (PDF Report)
Creamer Media’s 2015 Input Sector Review on Pumps provides an overview of South Africa’s pumps industry with particular focus on pump manufacture and supply, aftermarket services, marketing strategies, local and export demand, imports, sector support, investment...
Liquid Fuels 2015: A review of South Africa's liquid fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2015 Report examines these issues in the context of South Africa’s business environment; oil and gas exploration; fuel pricing; the development of the country’s biofuels industry; the logistics of transporting liquid fuels; and...
Road and Rail 2015: A review of South Africa's road and rail sectors (PDF Report)
Creamer Media’s Road and Rail 2015 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail infrastructure and network, the funding and maintenance of these respective networks, and...
Defence 2015: A review of South Africa's defence sector (PDF Report)
Creamer Media’s Coal 2015 report examines South Africa’s coal industry with regards to the business environment, the key participants in the sector, local demand, export sales and coal logistics, projects being undertaken by the large and smaller participants in the...
Real Economy Year Book 2015 (PDF Report)
There are very few beacons of hope on South Africa’s economic horizon. Economic growth is weak, unemployment is rising, electricity supply is insufficient to meet demand and/or spur growth, with poor prospects for many of the commodities mined and exported. However,...
This Week's Magazine
The BMW Group will invest R6-billion at BMW Group South Africa’s (BMW SA’s) Rosslyn plant to produce the next-generation X3 sports-activity vehicle (SAV) for the local and export markets. Rosslyn will continue production of the current 3 Series through its lifecycle,...
The lack of consequences for poor performance and transgressions on the part of contractors remains a significant hurdle to tackling South Africa’s service delivery challenges, delegates heard at the Consulting Engineers South Africa Infrastructure Indaba, on...
City of Ekurhuleni executive mayor Mondli Gungubele earlier this month officially named the city’s bus rapid transit (BRT) system, Harambee.
About 58% of unstructured data stored by companies is dark data, which means that the value or regulatory importance of the data has not been determined. Subsequently, most of the stored data add costs, rather than increasing revenue or reduce regulatory risks, says...
Effective logistics, import/export and manufacturing consulting services require detailed industry knowledge and experience, but can add significant value to these industries by providing expert advice on various technical elements in their value chains, says...