When it comes to supply risk, we're often most worried about the financial viability of our suppliers. Occasionally, we're also concerned with things like making sure they don't employ children, muck off the environment (or at least not muck it up, getting it splashed all over CNN and Fox) and ensure their share of minority and women-owned suppliers -- yet all too often for the wrong, government reporting reasons versus those tied to revenue. But when it comes to supply risk, perhaps we should be as concerned with assuring supply and keeping our supply chain as radiation free as anything else. A recent story on Spend Matters' affiliate site MetalMiner illustrates yet another example of radioactive scrap making its way into the global supply chain before being caught.
The story covers the case of how a "local metal scrap yard in New Delhi, India" purchased radioactive stainless steel from a local university science department, resulting in several being sickened and one death. This is not the first time radioactive scrap in India has made its way back into the metals supply chain. MetalMiner notes that "this incident, like [earlier ones] ... involves India and it involves a gamma cell machine sold by a local university via auction to a Delhi scrap dealer. The gamma cell machine belonged to the chemistry department where students tested gamma rays on chemicals, according to the WSJ, though the machine had not been used since 1985. The machine contained the radioactive isotope Cobalt-60 used in medical applications including radiation for cancer treatments as well as nucleonic gauges according to the article. The scrap dealer acquired the machine in February."
It's unlikely that radioactive scrap would make it this far in the US supply chain. Chances are, it would be picked up even before entering a domestic Mini-mill that recycles scrap and uses it to produce new steel. In her story, Lisa quotes Franky Griggs, who runs a Nucor facility. He notes that his plant has "four opportunities to detect a source prior to melting with plans to add an additional layer of redundancy." Moreover, "typically, our scrap suppliers have source detection at their entrances as well. The last thing that they want to do is to send a source [radioactive] to us. It is rare, but we have rejected material when we detect a source."
When we think about the risks of global sourcing, we often concern ourselves with the types that regularly make the headlines. But we should also remember that lower-tier global suppliers might not necessarily adhere to the same standards we do. In this case, the tragedy is that the radioactive material quickly caused deaths and injuries. In cases of lower-emitting radioactive material, the effects may not have been detected until the steel made its way into end-use material. Is this a type of supply risk your organization is thinking about when it sources from India and other developing markets? If not, perhaps it should be.
- Jason Busch