Benzinga | Aug 13, 2021 02:29PM EDT

Supply Chain Gaps Exposed by COVID-19 Spur Search for Local Mines and More Agile Planning

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As COVID-19 swept the globe last year, supply chains across every industry were upended. Because many of the issues were the result of ongoing inefficiencies in global supply chain networks, the pandemic-era adaptations that were made to fix them are likely here to stay.

American manufacturers that once relied on China as the world's leading mining country were cut off from this major source, placing increased pressure on American mines which, while plentiful, are currently only producing about half the output of China. That increased pressure is driving a frenzy to find new local mines and adapt America's mining industry to make it stronger and more agile.

Here are some of the COVID-19 era trends that are likely here to stay:

Increased Demand for Local Mines

When the pandemic hit, the aftershocks were felt throughout the entire supply chain, but the more extended supply chains were hit hardest. This forced mining companies to reevaluate their supply lines and shift toward more resilient local sources.

American Pacific Mining (OTCQB:USGDF), for example, has recently gained heightened strategic interest from major mining companies like Rio Tinto (NASDAQ:RIO) and investors like Michael Gentile. The junior resource exploration company's three projects located across Montana and Nevada-- which have all yielded encouraging early results for gold, copper and silver -- are seen as a promising opportunity to invest in expanding America's mining output.

Shorter Cycle Planning Driven by Better Data

In addition to shortening supply networks through the emphasis on local sources, mining companies are also shortening their planning cycles through more data. All the uncertainty surrounding COVID-19 made long-term planning difficult so mining companies shortened planning cycles by necessity.

To avoid costly surpluses or unexpected shortages, planning also became more strategic and data driven. Mining companies looked to data to better evaluate their supply chains and better predict future demand from their buyers. Those more frequent adjustments and more data-driven decisions proved to make mining companies more agile and efficient -- not just during a pandemic.

BHP (NYSE:BHP), for example, has integrated advanced analytics to monitor multiple tiers of its supply chains in real time. With this data, BHP can spot potential disruptions quickly and pivot to alternative sources or adjust production schedules before the disruption leads to a major problem. This move has made the leading mining company more flexible and better able to respond quickly to avert future disruptions.