Galvanised Wire Up 14% Because of Global Volatilty

Media release
April 4, 2008

Pacific Steel Forced to Raise Price of Galvanised Wire by 14% Because of Global Volatilty

Pacific Steel Group has advised customers it will be increasing the price of its soft and high tensile galvanised wire range by up to 14%, effective from May 1.

Pacific Steel Group general manager John Beveridge says the company has no option but to pass on to customers the increasing international cost of the raw materials for making steel. The latest price hike follows on from a similar increase at the beginning of March.

“We predicted at the time that ongoing volatility in the global steel commodities market would necessitate regular reviews of our pricing, and this has unfortunately been the case,” Mr Beveridge says.

“We are, however, surprised by the magnitude and speed at which the market has increased.”

Mr Beveridge says New Zealand wire prices are still very competitive in the global market and the company will continue to monitor commodity prices in the coming months.

All Pacific Steel Group products are made entirely from New Zealand-sourced recycled scrap metal, but the price is set by the international market. A global shortage in scrap metal, and strong demand for steel in China and other Asian countries, is behind a significant rise in cost of scrap.

“There has been some panic buying in anticipation of price increases which has fuelled the price of scrap metal to more than $US600 a tonne, up from $US380 in December,” Mr Beveridge says. “The prices of other steel products are also rising in a similar fashion.”
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Despite the global shortages, Pacific Steel Group will be able to maintain supplies to its major customers in New Zealand.

Pacific Steel Group in Auckland is New Zealand’s only manufacturer of reinforcing steel and wire, under the Seismic and Wiremark brands respectively.

ENDS

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