Heavy equipment imports: Reflection of economy
Feature of the week: Skelton Sherborne has released their April 2010 Shipping Index, which reports a 27% fall in machinery imports from March, when a positive surge of 103% had been reported.
The total number of units imported in April was 1,832, down from 2,524 in March, yet up from the 1,242 reported in February.
The world's largest international freight forwarder of mining and construction equipment, Skelton Sherborne compiles its Shipping Index from Australian Bureau of Statistics data, and its own import data.
The Shipping Index is released at the end of every month, and is a lag indicator of the state of the mining and construction industries, based on the import activity into Australia.
Machinery import figures are down in the majority of categories. For example, not a single wheel dozer unit was imported. In this, Skelton notes its April 2010 Shipping Index figures are normal for the early stages of an economic recovery cycle, as businesses undertake stock replenishment and then take a slight pause.
On a high note, Skelton has reported its customer's forward orders still appear buoyant, despite their having voiced serious concerns over the negative impact of the Government's proposed 40% mining tax.
Director of Skelton Sherborne, Brad Skelton, says that since the announcement of the mining tax, the company is seeing some of its customers hesitate. In fact some have stopped importing mining machinery until they gain more clarity about how the tax would be applied, and what the impact is on them and the projects they are working on.
One customer in particular had purchased some equipment in North America and decided to leave it there, rather than ship it to Australia, waiting until they learn the full implications of the mining tax.
In line with the mining industry, Brad Skelton views the government announcement as already stifling investment and causing decisions to be postponed or deferred, until there is more clarity.
The categories which resisted the downward drift to rise include Tree Fellers and Tree Harvesters – up 80% to 9 units, and Tracked Loaders – up 65% to 94 units. Bull dozers rose 34% to 59 units, in addition to Mobile cranes – up 25% to 5 units.
Mini excavators, less than 12t, represented the category with the largest number of units imported in April – at 441 units or 24% of the total imports, followed closely by Wheel Loaders – at 410 units or 22%.
These two categories combined for 851 units imported in April, representing 46% of the total imports for the month.