The Metso Outotec foundry at Prerov in the Czech Republic may need help, as the company evaluates the feasibility of operations. Energy and production have caused the foundry’s woes, to the point where it may have to be shut down by Metso Outotec for economic reasons.
“The Prerov foundry has good production capability and competent personnel, and historically it has had a specific role as part of our global foundry network. Continuing the operations in Prerov does not, however, meet our strategic profitability and development targets. As our first option, we are looking for a new owner for the foundry. Other options are also under consideration if a new owner cannot be found in the short term,” Heikki Metsälä, President, of the Consumables business area, Metso Outotec stated to the press. This may possibly concern Metso Outotec’s customers in the mining industry. The Prerov plant produces parts for mining companies, and its shutdown may have short-term effects on supply.
So why did this happen?
Prerov isn’t the only location suffering from the increased energy costs and disrupted supply chains. The unpredictability of energy prices is a primary concern going into 2023 and beyond. Companies should create action plans for a variety of scenarios. One thing is clear, consistent, sustainable energy gives a business stability. Otherwise, companies can explore a number of options to at least limit their energy use. Maintaining efficiency while cutting costs will be a key part of any 2023 strategy. Companies need to explore technological solutions to energy efficiency to keep spending in check. Similarly, labor shortages and increasing transportation costs all create weak spots in a company’s supply chain. This can translate to compounding scarcity and unexpected costs. Transportation costs are directly linked to energy costs, so any fluctuation in one market will negatively affect the other. Various vendors, manufacturers, and logistics providers all suffer from the same problem.
So what should companies learn from Prerov?
Even though energy prices are beginning to stabilize since 2022, the aftershocks in the market can still be felt. Similarly, the push to decarbonize also creates a variety of pressures on costs and regulations. Companies need to learn and adjust to the forthcoming changes. Join key decision makers at the 2nd Energy Transition for the Metals and Mining Industry conference, on January 19-20th, in Toronto, Canada. Industry leaders will gather to discuss and exchange the best practices for implementing green fuel and sustainable infrastructure. Visit future-bridge.eu or mining-events.com and follow us on our social media to keep track of other events about sustainability in the mining and metals industry.
