The manufacture, distribution and rollforming sectors of the steel industries may follow suit in Australia after this report from Craigs Investment Partners on the New Zealand Steel Industry.
Analysts predict plummeting steel prices and demand may force New Zealand's steel firms to merge in order to survive. Firms' margins have been squeezed in part because of the slowdown in China's economy which is pushing more Chinese steel into the global marketplace.The Australian market is saturated at the moment with rollformers and only a few individual products are keeping ahead of the decline in total sales. Do the residential & commercial buyers of roofing products associate with brand? Do they decide on the company first then the product? How many specifications by engineers and architects are followed by the builders? Will mergers of Australian rollformers occur in the 2012/2013 FY?
Falling steel prices in China are putting pressure on the profitability of New Zealand's steel companies. China accounts for around half of the world's steel production and consumption. But over recent times falling domestic demand in China has prompted Chinese firms to export more steel, depressing world prices.
The price of iron ore, used in steel making, has dropped almost a quarter in the last month, while the price of rebar, a common type of steel used in construction, has dropped by 9%.
Mr Mark Lister head of private wealth research at Craigs Investment Partners said that New Zealand's steel companies are under pressure from these weaker steel prices. He says the recent Fletcher Building result shows their steel division is struggling more than the other parts of their business.
Mr Lister says New Zealand is a relatively small market and when it's not growing because demand is low, there is a need for potential rationalization. He says there could be some consolidation in the industry.
Steel prices may yet get a boost, however, given a decision by China's national planning body to invest USD 157 billion in rail and other infrastructure projects to stimulate its cooling economy.
Source - Radio New Zealand
The FOR SALE signs are out there already - but are there any buyers?
Steel Innovations - can Australia do this.
Then we are getting new mobile roof machines from China that are able to produce on site a complete bunker/warehouse without structural steel - corrugated roofing with a 151mm groove depth. All the details are here at Chongqing Zixu Machine Works. Some photos below:
|Mobile Mill - they can make 20 per month of these machines.|
|Started the construction.|
|Finished military bunker or warehouse!|
The USA company - Rocket Steel Building also do this - but mainly military:
Rocket Steel Buildings
|Big Area Military construction by Rocket Steel Buildings.|