October 14, 2008

Rebar prices to increase in New Zealand

It is reported of falling New Zealand dollar and high world scrap prices have driven up reinforcing steel and wire prices in New Zealand and Pacific Steel Group has advised its customers that it will increase reinforcing steel and wire prices by between 6% to 8% from October 1st 2007.

Mr John Beveridge GM of Pacific Steel Group said that “While we try to protect our customers from the impact of exchange rates, this latest fall in the New Zealand dollar has been too great for us to absorb. He said that all steel prices in New Zealand are likely to rise sharply over the next few months and we expect continued volatility. But our October price increase will lock in prices for our domestic customers until the end of 2007, which provides some certainty over the next few months.

The fall in the New Zealand dollar from over USD 80c to around US 70c during the past month and the continued rising price of world scrap metal are driving up reinforcing steel and wire prices. Scrap metal, the main component of reinforcing steel and wire, is traded in US dollars. Scrap metal prices have hit historic highs over the past four months, meaning finished goods prices have also continued to rise.

Pacific Steel Group, which operates one of the world’s most environmentally friendly steel mills and is New Zealand’s only manufacturer of reinforcing steel and wire, under the Seismic and Wiremark brands respectively.