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Steel prices at record high

06 July 2021

Handling & Storage solutions magazine editor Simon Duddy caught up with José Manuel Lucio, who has recently been appointed EMEA sales director at AR Racking, at a time of booming demand, prices and challenges.

IT’S NOT like you can build racking out of lego. The industry relies on steel and steel prices have reached a record high, says José Manuel Lucio. 

It is not specifically related to the UK, and is a result of EU anti-dumping regulations aimed at China, as well as a bounceback in demand in the wake of Covid.

Jose explains: “We are living, since the end of 2020, with a big steel crisis. We have the highest prices of steel ever. And we also are facing a shortage of steel supply in Europe. This has created great turbulence and volatility in prices and delivery. This is a big issue, much greater than Brexit. 

“We are observing what is happening very closely and playing very fairly with our customers, so we can adjust our delivery times and prices in advance, so that when they approve an order, everything is guaranteed.”

The background is a ten year period of growth for AR Racking, partly due to the eComm boom. This has prompted AR to adjust its structure to approach the market, into three broad channels: distribution, direct sales, and through systems integrators. Jose is responsible for distribution and direct sales in the EMEA region.

The Covid pandemic itself also provided a challenge. 

Jose says while staff at AR Racking were accustomed to a little home working, and using Apps such as Teams, these trends accelerated greatly during the pandemic and it was a big challenge to manage the business more remotely. 

“We are observing what is happening very closely and playing very fairly with our customers, so we can adjust our delivery times and prices in advance, so that when they approve an order, everything is guaranteed.”

“In the factory, people needed to be there physically, but for office workers, it changed. We had no time to prepare, but we did it, and we have to be positive about how we have managed,” says Jose.

In business terms, there were some difficulties in the initial months, mainly because of restrictions around transport and assembly, which are key parts of the AR offering. But the market continued to have strong demand.

“Obviously all business related to eCommerce are booming and we’ve also seen a transformation in smaller, or more conventional companies, who have been trying to adapt themselves to a more B2C model.”

Brexit on the other hand was relatively un-disruptive for AR Racking. 

Jose says: “It did create uncertainty, everyone was apprehensive. Obviously we have more paperwork, charges and bureaucracy to deal with. But overall demand has been good, although there were demand fluctuations due to overstocking of products, for example.

“In the end the most important thing has been the transportation crisis, not only for our business but for the whole country. We are still facing challenges, the UK is facing a serious shortage of truck drivers and trucks.”

For more information, visit www.ar-racking.com

Half pallet storage for 3PL

AFTER A commissioning period, the specialist transport and logistics services company Jaylo is operating a 17,000 sq m logistics platform in Tudela, Spain at full capacity. AR Racking has equipped the logistics centre with its storage systems. The installation integrates Jaylo’s facilities with those of its customer SKF, a company specialised in the design and manufacture of bearings for the automotive sector. AR Racking installed, on the one hand, adjustable pallet racking, providing 2,700 new positions for pallets and 2,200 new positions for half pallets. And, on the other, FIFO live pallet racking, resulting in 2,160 new positions for half pallets. In total, a storage capacity of 7,060 new positions for pallet loads, occupying 4,250 sq m of the total area of the warehouse. Thanks to these storage solutions, Jaylo can supply and collect the finished product at the request of its customer SKF 24 hours a day.

The combination of both storage systems has given Jaylo a logistics platform that fully optimises the space as well as enable time and resource savings in handling goods. The adjustable pallet racking area provides direct and immediate access to products, while the FIFO live pallet racking facilitates perfect stock rotation and fast movement of the unit loads. To guarantee the correct positioning of the half pallets of the live pallet racking systems, the structure has been fitted with lateral guide wheels, ensuring a maximum lateral movement of 15mm in the descent of the loads down the conveyor. This means that the driverless AGV forklifts can satisfactorily collect all the unit loads.