Article, magazine of the Spanish Iron Stockists Association, by our Commercial Manager, from Grupo Mora, José Francisco Sánchez

“We must think about this new situation”

As it could not be otherwise, I would like to begin this article making special reference to the victims of the Ukrainian War, its citizens and people who travelled there and who are suffering this cruel barbarism.

In fact, we are just suffering some collateral damage, only in the economic and production sectors. Certainly, it has made surprisingly clear the production potential of Ukraine, especially in the cereal and oil production.

We are starting 2022 with an unknown situation for the sector in recent years, still immersed in a pandemic, accepting the extra charge of the energy crisis, with prices that are still high due to the increase from last year. Furthermore, we have to add the conflict in Ukraine and the national transportation strike on the 14th of March. These new circumstances have been aggravating the situation, as a result, most of the steelworks and first processors will stop laminations, production lines and will stop quoting intermittently, with quotations valid for the day or just for hours. All these circumstances have had an impact in plenty of sectors and have affected the production of many others, particularly the construction sector. Lately, many constructions have paralyzed their works because of the lack of resources and high costs for raw materials.

We must think about his new situation and consider, undoubtedly, that the model we have been working with is not the most suitable one for the future. We should ask ourselves if we are ready to make business with the current price volatility. Somehow our customers must find the way to sign flexible contracts with their final clients, as it has been done with public works, with the entry into force of the Royal Decree-Law 3/2022 for the exceptional review of prices in public works contracts. Otherwise, and due to the circumstances of the current prices, the continuity of our companies could be compromised.

On another note, to prevent the impact of the transportation strike we will have to work in order and in coordination with our manufacturers to re-establish the deliveries to our customers and avoid tension in the sector due to the lack of delivery service for raw materials lately.

We hope all the manufacturers and transportation companies could help us to minimize the lack of supply until the situation returns to normal.

Thank you for all for the contribution to improve the sector

All the best. Galería