As factories and ports shut in coronavirus-affected regions of China, global supply chains are feeling the effects.
With so many construction products sourced from China, accounting for as much as 20% of total construction cost, Australian contractors are advising their clients to expect project delays.
Materials most likely to be affected include joinery, curtain wall and facade systems, timber flooring and metalwork.
It is still not clear specifically what projects are affected but RLB consultancy said it was aware of high-rise projects in the Melbourne CBD on which contractors had issued notices of delay.
In addition, Australia’s largest rail operator, Aurizon, has advised that the arrival of 66 new rail wagons produced in Wuhan will be delayed.
Why we should care..
As the 5th largest importer of Chinese goods, more products are imported into Australia from China than anywhere else.
This incident highlights our heavy reliance on China and the risk that is involved with not having a suitable alternative when these supply chains are broken. This is a wake-up call for companies to look at domestic supply chain alternatives as a risk mitigation strategy.