By KELLY LOUISEIZE
A newly established procurement team at CVRD Inco and CVRD will be seeking value for some of their large order purchases.
Under the leadership of Eduardo Ledshan director of mineral exploration, part of the team’s mandate will be to “maximize our effectiveness in procurement,” according to a CVRD Inco statement from head office.
The idea will be to pool the resources to find the greatest value when ordering bulk quantities, Mark Cutifani COO of CVRD Inco says.
They will do this through an e-marketplace called Quadrem. The site began in 2000 with 14 of the world’s largest mining and industrial houses. The idea was to take procurement to the web and interact with suppliers for the sale of goods and services to a global pool of buyers. An estimated 80 per cent of CVRD Inco’s goods are ordered through Quadrem. Now, the Mother company will be using the same system for international contracts.
The impact on the local mining services and supply sector will be minimal, if at all, Cutifani says, since Inco has already secured procurement partnerships seven years ago with local companies. But there is room for the mining supply sector to grow. The Mother company is looking to consolidate some of the more significant bulk commodities to find greater value through Quadrem.
For instance, CVRD conducts business with Caterpillar in both Brazil and Greater Sudbury. Both operations were quoted different unit costs for the same product. Under the new procurement strategy the two companies have reached a common price with the product moving out from the Sudbury operations.
Supply companies have much to offer the international market since they posess years of servicing some of the deepest base metal mines in the world, Cutifani says. Smelters, underground furnaces and maintenance support provide the greatest fit for global contracts.
“The skills and expertise we have in underground mining is as good as anywhere in the world. If that skill can be competitively transported I think we will be in a good position. This may help give the mining and service sector more exposure.”
CVRD will ferret out the right bidders for the contracts, and although they have their own rolodex of suppliers CVRD Inco has made strides with some of the North’s mining supply sector companies.
“CVRD will be respectful of relationships, but we have always said to the local industry if you’re competitive you will get the business and if it is line ball, we will go with you because of the local content.”
At a luncheon held by the Sudbury Chamber of Commerce CVRD Inco’s CEO and President Murilo Ferreira repeated the company’s commitment to maintain and grow relationships. He says the introduction of a global procurement team was developed to continue with growth in the company.
Reinforcing the mantra that together we are better, Dick DeStefano president of Sudbury Area Mining Supply and Service Association (SAMSSA) is making that happen by welcoming seven Brazilian companies to Sudbury March 8, at Cambrian College. The intent is to match Brazilian companies with area suppliers, “so that there is a mutual benefit to both parties,” DeStefano says.
SAMSSA members will have an overview of the mining and business climate in Brazil along with potential opportunities for partnerships. He says it is the first step in establishing symbiotic relationships with foreign companies for procurement purposes.
