Beijing: The year opens with a battling ground for manufacturers who are struggling to procure raw metals. The condition worsens as manufacturers join the race to invest in securing the supplies of raw materials, which are used in production of metal products.

In order to tackle the supply chain shortages, many manufacturers are considering revising their business models and also tying up as well as forming alliances. Large manufacturers and robust mining industries are witnessing a huge supply shortage. They will be highly motivated to secure the supply chain as well as reduce dependency on pricing techniques due to the prevailing condition.

With regard to China’s production, PricewaterhouseCoopers (PwC) said, “Concerns have been raised over how these and other raw materials, are sourced, exported and controlled”. A report issued also stated, “Vertical integration through minority stakes in miners continues to be a major theme.”

There are also reports that the consolidation trend, which is highly fragmented amongst Chinese and European manufacturers, has been strong and will be continuing this year too. January saw the consolidation of Georgsmarienhütte Holding, ThyssenKrupp and copper producer Aurubis. These companies had joined a commodities alliance of German manufacturers, coordinated by the Bundesverband der Deutschen Industrie (BDI). More of such trends will grow further and stronger this year.