Posted on 07/01/2008 5:42:28 PM PDT by TigerLikesRooster
Supplier price rises force industry rethink
Carl Mortished: World business briefing
Suddenly, it is not the customer who matters; it is the supplier. The stuff that arrives at the factory loading bay is now expensive; shortages and logistical logjams are playing havoc and the company that sells you a vital commodity is digging in its heels, refusing to renew a long-term contract without a big price increase.
It is time to start thinking about vertical integration. Owning every segment of the production process from metal mine to packaging plant is an unfashionable idea, but in some industries it is coming back with a vengeance.
Posco, the South Korean steelmaker, said yesterday that it had paid $440 million (£221 million) for 10 per cent of Macarthur Coal, which supplies a third of the coal used in the world's steel mills.
Posco is following others; Citic, the Chinese trading giant, has amassed a stake of 18 per cent in Macarthur, and Arcelor Mittal, the world's biggest millowner, has raised its holding in the Australian miner to just under a fifth.
(Excerpt) Read more at business.timesonline.co.uk ...
Ping!
Suddenly having your production in China isn’t so cheap, is it? Maybe their is an upside to high fuel prices.
In hindsight, what else is a JIT manufacturer to do?
Caveat vendor because customer is king.
Australians are utter morons to allow Korea and China to buy into their natural resource corporations. Sheer lunacy.
Do you see the Arabs allowing foreigners to buy into their oil companies? Quite the contrary. Western oil companies used to run ARAMCO. Now they are beggars for Saudi oil same as everyone else
Mostly correct. With a lot of discipline the USA could do without any imports and just export stuff. But we have less testosterone and discipline than we did 20 years ago so highly doubtful
Good thing Clinton Vetoed drilling in Alaska and made the largest cleanest coal deposit in the World Off Limits.
If you like $5/gal, Thank Congress in Nov.
Pray for W and Our Troops
Why? It's not like the Koreans or Chinese can relocate the mines...
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