Race for generators causes fear of shortages among suppliers – Economy

Jhonatan Oliveira, (D), with assistant Wemerson, bought 2 generators for the neg
Jhonatan Oliveira, (D), with assistant Wemerson, bought 2 generators for the family business and complains about the difficulty of maintenance (photo: Edsio Ferreira/EM/DA Press. Brazil)
Misfortune for some, opportunity for others, but also in a complicated scenario. Driven by the increased demand for rental and purchase of power generators, given the risks of the country facing a rationing of input, providers of these services fear the lack of equipment to meet the higher demand expected this year. Companies in the segment point to 35% growth in 2021.

Economic activities that depend essentially on energy have sought to guarantee machinery, as a “precaution”, considering that the more expensive generation of thermoelectric plants and the measures to stimulate consumption savings that the government has adopted are not sufficient to prevent blackouts.

“Today’s scenario represents a very big risk for those who have electricity as a strategic component of their business. Companies are following the decisions in the electricity sector, but they are already preparing for a scenario that may lie ahead. Many are looking for lease or even purchase of generators”, says Carlos Faria, president of the National Association of Energy Consumers (Anace).

At the height of the pandemic, between the end of 2020 and the beginning of this year, the production chain of materials for the sector worked on a kind of roller coaster. There was a shutdown of factories, a reduction in personnel, suspension of production in the copper mines in Chile, raising the price of the metal from R$ 40 to the current R$ 85 per kilogram, sold in bars for the manufacture of electrical panels. Another source of pressure on costs was the readjustment of steel prices, which accumulated a 79% change from January 2020 to last March, according to data from the Federation of Industries of the State of So Paulo (Fiesp).

The situation, according to Mrcio Martins, partner and industrial director of Geraforte Geradores, located in Contagem, was aggravated by the crisis caused by the stranding of the Ever Given freighter between March 23 and 29 in the Suzez channel, which caused a blockade of one of the main maritime trade routes in the world. The incident had a negative influence on the import of parts and semi-conductors, used in the manufacture of engines, and one of the main components of the generator group, “with reflections even today”, he points out.

Martins says that the more people talk about the possibility of rationing, the demand for generators tends to increase, mainly by sectors that cannot run out of electricity. Between July 1, 2001 and February 19, 2002, during the second term of President Fernando Henrique Cardoso (PSDB), rationing was applied that established a mandatory 20% reduction in electricity consumption, under threat of fines and cuts. supply.

Prev power generators market
Market for power generators forecasts growth of 35% this year, but it is already suffering from the lack of components, including imported ones (photo: Edsio Ferreira/EM/DA Press. Brazil)

Denancir Filipin, commercial director and partner at Geraforte, explains that the consumer market for generators has changed in two decades. “There is a generator set for all types of consumers, in terms of power, who use 10 to 1 million kilowatts/day. Agribusiness has been driving growth in the sector, especially in the poultry sector. But, if before the equipment’s main consumer groups included hospitals and shopping malls, today it serves all sectors of the economy, including small businesses and industries.”

Inventory

Given the possibility of a shortage of inputs in the near future, the company is anticipating purchases and increasing inventory. “Manufacturers who didn’t do this are starting to have serious problems. Today, our delivery time has been affected by a longer lead time”, explains Filipin. Shipments that took between 20 and 30 days have already stretched the deadlines to 45 days. In cases of demand for larger engines, the deadline is 6 months, instead of the 45 to 70 days before.

Victor Sant’ Anna, market intelligence consultant, points out a scenario “is not very good. If next week there was an increase in demand, there would be a lack of generators to supply and, if demand continues at this rate of growth, the situation could become relatively chaotic .”

According to consultant Victor SantAnna, if demand maintains the pace it reached this year, supply could
According to consultant Victor SantAnna, if demand maintains the pace it reached this year, supply could face the collapse

(photo: Edsio Ferreira/EM/DA Press. Brazil)

In 20 years, there have been significant changes in the use of the generator set. There are three pillars of this branch. Motors used to generate energy in places where there is no network, such as in the case of road works and mining. Other equipment is purchased only to operate in times of power failure, such as in emergency situations in hospitals, for example. And there is the large consumer who uses the generator at peak times, when the cost of public energy is more expensive, as is the case with jurisdictions.

to dodge peaks

Jhonatan Felipe Passos de Oliveira, 28, is a merchant, from a family with ventures in various fields, from supermarkets, family farming and civil construction. In all sectors, generators are used. A resident of Esmeraldas, in the Metropolitan Region of Belo Horizonte, he says that there were difficulties in carrying out works in rural areas, due to the constant power surges, a situation that worsened when there was no electricity in the supermarket.

The acquisition of generators allowed for the expansion and expansion of the business. “There are two models. The simplest one is powered by gasoline and the other one is diesel, more modern and silent, with an electric starter and greater power”, he explains. Both devices meet all needs well, according to the dealer.

They are moved to the family supermarket, the plantations and the raising of animals on the rural property. “They are guarantees for any eventuality”, says the merchant. The generators also guarantee the rental of the family’s place for events and are rented to irrigate neighboring gardens. Jhonatan says he misses spare parts. “The manpower for maintenance is still scarce, but the greatest fear is what this crisis is going to be like.”