Managing Growth in Aggregate Mining: How to Reduce Fuel Costs for the Short and Long Haul

Aggregate mining is estimated to be a $1.1 trillion market by 2020, putting new pressures on aggregate mining fleets. While China is the largest producer and consumer of aggregates, North America is close behind (SOURCE: Persistence Market Research), with several factors at play that are contributing to this growth, including urbanization, population growth and investments in infrastructure.

Aggregate materials are the building blocks for our homes, businesses, roads and bridges, and are critical to boosting the economy through new construction projects. This presents both an opportunity and a challenge for aggregate mining fleets. On the one hand, they should embrace this growth and the business it brings, but they must also ensure they’re able to remain profitable as they try to meet the new demand.

Margins are already thin and customers are demanding and often have detailed specifications. If their demands are unexpected and a mine does not have what they want, the customer can simply call the closest mine that does. Production costs also continue to rise, thanks to increasing energy costs, maintenance, wages and regulatory compliance, and permits are not easy to secure. Ideally, an aggregate mine should be close to residential areas to minimize transportation distances but most people don’t want a quarry in their backyard.

So where does that leave these fleets? They must find ways to cut costs and produce more for less, and many are turning to telematics to do so – especially when it comes to reducing fuel consumption, which is often the second largest cost after payroll. In fact, a single haul truck can consume between $130,000 to $260,000 worth of fuel per year. Fuel costs are only rising, and fleets must consider ways to reduce costs both in mining these materials and transporting them to ready mix or asphalt plants.

Reducing Costs for the Short Haul

The typical aggregate mine in the U.S. produces around 250,000 tons per year but some sites produce up to 10 million tons. Fleets operate large and expensive machinery to excavate and load the haul truck, then haul those rocks to the crusher, crush the rock and start the process all over again.

These machines do not travel far, but the sheer amount of mass they carry around means a lot of fuel is burned. GPS fleet management solutions can help find inefficiencies in this process, whether it’s identifying poor operator behavior like speeding, which impacts fuel, maintenance and wear and tear on tires, reducing unnecessary idling, or eliminating bottlenecks that may exist in the workflow.

Reducing Costs for the Long Haul

Once the rocks have been crushed, they must be transported to the concrete or asphalt plant. In the best scenario, these plants are close by or at the aggregate mine – but that’s not always possible, as the mining sites can be in remote locations. Therefore, these trucks may travel far, which means increased fuel costs. In fact, the cost of transport for aggregate doubles every 25 miles traveled. This is where GPS tracking comes in.

These tools identify the most efficient route to a plant or job site, rerouting around traffic and offering drivers turn-by-turn directions to ensure they don’t get lost. They provide managers insight into the location of every single vehicle and exactly how much fuel is burned on each mile of the trip. What’s more, telematics can even identify which vehicles may burn more fuel than others, and offer the cost comparison analysis to determine if those assets should be replaced with newer, more fuel-efficient vehicles.

In our experience, telematics can reduce fuel burn by 10 percent, saving an aggregate mine with five haul trucks between $50,000 and $300,000 a year. As demand for services and materials increase, fleets will look to modern technology to further reduce their costs of production, while also growing their businesses.

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