Steel And Wire Prices Driven Up

Falling NZ Dollar And High World Scrap Metal Prices Drive Up Reinforcing Steel And Wire Prices

Pacific Steel Group has advised its customers it will increase reinforcing steel and wire prices by between six and eight per cent from October 1, 2007.

The fall in the New Zealand dollar from over US 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.

“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,” said John Beveridge, the general manager of Pacific Steel Group.

“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,” said Mr Beveridge.

Pacific Steel Group has advised its direct customers not to lock in long-term selling pricing with their end customers because volatile global markets and exchange rate uncertainty mean more price increases are possible.

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.

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