Difference on scrap metal

Press, Volume CXI, Issue 32588, 23 April 1971, Page 1

Difference on scrap metal

(By our industrial reporter)

An increasing shortage of scrap iron in New Zealand has been highlighted by a complaint from five Christchurch foundries that New Zealand Railways will not sell them some of its own scrap.

The Railways Department says it has relatively little scrap metal in Christchurch and needs all the cast iron for its own foundries. The business firms, however, claim there is more than 1000 tons of scrap at Addington, and suggest it is being kept for Pacific Steel in Auckland rather than for the Railways’ own use.

However, even if all the Addington scrap were cast iron—which it certainly is not—and even if the Railways parted with the lot, the local foundries would gain only temporary relief. Among the five of them they use 50 tons of scrap a week; and they and the scrap metal dealers are having to range further afield to satisfy demand. The situation seems to be due to a combination

of increased production and of reduced wastage, and there can be little doubt that

the shortage will get progressively worse. The dealers are offering 80c a hundredweight, and by the time the dealers’ labour and cartage costs, overheads and profits have been added, the foundries end up paying something like $3O a ton.

But the present alternative is using imported pig iron, at $BO a ton. A future alternative is importing scrapbelieved not to have been done for more than 50 years —and the combination of overseas competition and freight could push the cost to $5O a ton more.

Two tilings seem clear. In ’ the foreseeable future, the , price of iron castings will ' have to rise sharply. And un- ' less the Government moves to prohibit the export of scrap iron, this day will come i sooner than it needs to.