Modern Quarrying Q4 2018

SURVIVING A CHALLENGING BUSINESS ENVIRONMENT

W e have come to the end of yet another tough year for the industry. Despite huge prospects of improved activity at the start of the year, the general sentiment is that construction remains sluggish. Considering that the quarrying sector feeds off construction activity, 2018 has once again turned out to be a tough year for the industry. The root of it all is an economy that has taken a few hard knocks in recent months. The technical recession is proof enough that things have been tough. In such a tough economic climate, the business environment has become more competitive, and quarry owners may have to change the way they do business to stay afloat. As you will see in this edition of Modern Quarrying , we go on site at Alpha Sand Group’s Roodepoort Quarry, a three-year old operation that has already proved itself against some well-established competitors in the Polokwane area. Having previously purchased aggregates from different quarries for retail, in 2015 Alpha Sand identified an opportunity to expand its business by establishing its own quarry. This has also allowed it to have better control of all the production processes, all the way from drilling

Peninsula quarry, including relentless pursuit for operational excellence, a range of in-house and group-wide innovations and the identification of niche, high value products, are key success drivers. In an environment where traditional big sellers don’t fly anymore, management at the 1-million tonnes per annum quarry continues to investigate several niche products that are also largely made possible by the quality of its blue rock material. For example, Peninsula is the only quarry in the Western Cape province that can produce -37,5 mm drainage material through a first crush. Any other operation would need to run material through a number of various processing stages. The -37,5 mm is a new product specification recently approved by SANRAL engineers and is to be written into the revised edition of the COLTO, called COTO – standard specifications for construction of roads and bridges in South Africa. Investigating new, niche products is one of the practical ways operations can improve their margins. In recent years, there has been a big drive towards the use of Ultra-Thin Fraction Couse (UTFC) on South African roads. UTFC calls for high-value aggregate material. In the past five years, UTFC has been successfully paved on some of the heaviest trafficked national highways in the country, as well as on other national routes, provincial highways and rural roads, as well as some major and minor urban arterials. UTFC is ultimately a very thin asphalt layer paved at between 15 and 20 mm thick while spraying a thick tack-coat to the road surface all in one pass. It has several functional properties and advantages over other conventional asphalt paving procedures and products. I believe it is during low growth environment that smart quarry owners can create opportunities for themselves. This can be a good time to innovate and identify new revenue streams by diversifying the product offering, particularly if the type of the rock permits and this can be done without a large capital outlay.

and blasting, to crushing and screening. An uncompromising focus on product quality has been a key driver of Roodepoort’s early success. A massive jump in sales from just 2 000 to 20 000 t per month in just three years is testimony to its early market share gains. Key quality enablers are washing and product shaping. Wet processing is helping improve the quality of end products, thus adding enormous value to the operation. The quality of its aggregates is also based on the shape of its end product. Producing high-quality wash sand has enabled the operation to obtain a premium in the market. Meanwhile, there is also a growing demand for cubical-shaped material in asphalt and concrete production. Complemented by the geology of its rock, this is an area where Roodepoort is thriving. Elsewhere, one of my key takeaways from another recent site visit at AfriSam’s Peninsula quarry is that when times are this tough, quarry owners should reassess their business models. They should also rein in operating expenses and overheads, while working hard on improving operating efficiencies. In the face of such tough market conditions, several initiatives at

COMMENT

Munesu Shoko – Editor quarrying@crown.co.za

@MunesuShoko

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MODERN QUARRYING QUARTER 4 - 2018