Gypsum industry news

New Zealand: Auckland's first comprehensive recycling facility for building industry waste, including wallboard, has been opened by the environment and building and housing minister Nick Smith, according to Live News.

"This new recycling facility is about greening the building industry, enabling 30,000t/yr of construction and demolition waste to be diverted from going to landfill. It will enable thousands of tonnes of wood, wallboard, steel, plastics and aggregates from the construction sector to be sorted and re-processed into a reusable form," said Smith.

The US$2.78m facility is part-funded by a government grant of US$1.39m from the Waste Minimisation Fund and has created 15 jobs in the local Onehunga community. The fund was established by the government from a US$6.6/t levy on waste going to landfill that was introduced on 1 July 2009. Over US$39.6m has been used to fund more than 100 projects in the past five years.

"The opening of this new facility is very timely with Auckland on the brink of its largest ever building boom. The house build rate has increased from 4000/yr to 8000/yr since 2011 and is expected to grow to over 12,000/yr. Each home constructed generates 4t of waste and it makes sense to recycle as much of this construction material as possible," said Smith.

Wood, plasterboard, steel, plastics, aggregates and cardboard are being targeted by CID Resource Recovery for recycling or reuse. Wood will be further processed into biofuel for industrial kilns, while old wallboard can be recycled for use as a soil conditioner. Scrap steel will be extracted by magnet and delivered to metal recyclers for processing and sale on the local or export markets. Various grades of plastic, card and paper will go to local recyclers for processing. Aggregates will be used locally for hardfill or drainage material on building or infrastructure projects.

"This sort of practical approach to recycling typifies the Government's Bluegreen approach to waste. We are partnering with business to find economically-viable ways to recycle waste and focusing on those areas where there are the biggest gains. This initiative is particularly significant as construction and demolition waste makes up half of New Zealand's total waste going to landfill," said Smith.

New Zealand: The Commerce Commission has completed its investigation into allegations that Winstone Wallboards Limited, a subsidiary of Fletcher Building, acted anti-competitively to maintain its market position in the manufacture and supply of wallboard. Based on the evidence gathered during the investigation, the Commission does not believe that Winstone has breached the Commerce Act 1986 and it will not be taking any further action.

"We have completed a thorough investigation and there is no evidence to suggest that Winstone has breached the Commerce Act in any of these areas," said Commission Chairman Mark Berry.

The Commission's investigation was centred on three areas: Winstone's alleged exclusive agreements with merchants, the rebates Winstone pays to merchants and Winstone's alleged practice of undercutting other wallboard suppliers on jobs. The initial investigation was completed in April 2014 and followed by additional interviews and further investigation.

Australia/New Zealand: The Australian and New Zealand chiefs of Knauf's wallboard operations have resigned. Additionally, the New Zealand business is under review, having posted a loss in its first nine months of operations.

The head of the New Zealand wallboard unit, John Russ, has confirmed to local media that he has resigned and will leave the company in two weeks. Meanwhile Mark Norris, managing director of Knauf Plasterboard in Australia, resigned with immediate effect on 6 November 2014.

Knauf has struggled to gain traction in the New Zealand building market, which is dominated by Fletcher Building and it took Knauf longer than expected to gain approval for its products from BRANZ, a local independent research and testing institute, before it could start to sell to consumers. Even then, the company said that it faced resistance getting its products into stores, which had established relationships with Fletcher.

New Zealand: Building supply merchants are reluctant to stock products of Winstone Wallboards' rivals and are squeezing alternative goods, claimed the chief of a competing business who supplied documents to New Zealand's Commerce Commission (CC).

Kevin van Hest, managing director of Elephant Plasterboard, which has only 3% of the market share in New Zealand, said that suppliers were shy about stocking or selling alternatives to Winstone's Gib because they had strong financial reasons not to. Van Hest claimed that the reasons include personal rewards like invitations to sporting and other events, overseas trips and financial payments.

The Commission announced in September 2013 that it was looking into the allegation, which remains to be concluded. Rick Osborne of Winestone Wallboard's parent company Fletcher Building said at the time that his business was advised that the CC intended to inquire into its wallboard supply arrangements with building supplies merchants. "The company will fully cooperate with the Commerce Commission and is confident that its supply arrangements comply with the Commerce Act," Osborne said.

A spokesman for Fletcher Building said that the system in operation actively rewards those building supply merchants who sold Winstone board, but there was nothing wrong with the deal. "Rebate structures are prevalent in most industries and in reality amount to price competition, with supply terms being based on volume and the duration of contractual relationships," he said. "Fletcher Building is confident that its arrangements are not anti-competitive and do not breach the Commerce Act. In that regard we aim to prevent any potential anti-competitive conduct through our internal compliance programmes," said Fletcher Building's spokesman.

David Thomas, Winstone's general manager, said that the business has a 94% market share because it manufactured and delivered the best product to customers. "People do have other options and they have for the last 20 years,'' Thomas said, citing Elephant wallboard and other products including Chinese board. But van Hest said that a combination of incentives and commercial pressure on merchants meant he couldn't get any more than 3% of the wallboard market, despite being in business since the 1980s.

Lack of competition and arrangements with merchants was one of the big factors forcing New Zealanders to pay 70% more for wallboard than Australians, which increases house-building costs by 40% compared to Australia. Big chains will sell Elephant wallboard, but not necessarily from their shop floors, van Hest said. Instead, if they sold it at all, they took a builder's order and arranged delivery from van Hest's Glendene warehouse to the construction site. Very few big chains would stock Elephant board. "Stores are reluctant to trade too much in Elephant wallboard because of the financial and other incentives," said van Hest.

New Zealand: Fletcher Building, which holds a 94% share of the New Zealand wallboard market, may be hurt by a Budget decision to remove tariffs on imported wallboard and duties on other building products, according to analysts. Building products provide about 20% of Fletcher's earnings.

The government said that it hoped to reduce the cost of a standard new home by US$3500, by temporarily dropping duties on 90% of the building materials used. The cost of building materials in New Zealand is around 30% higher than in Australia.

The Building Industry Federation's chief executive Bruce Kohn doubted the Government's claim that the move would save new-home builders US$3500 and said that similar moves in Australia saw that market 'flooded' with low-quality building materials.

Finance Minister Bill English said that reducing the tariffs would build on the government's previous reforms to deliver more competition to the building materials industry. However, Labour leader David Cunliffe said, "Average prices in Auckland rose by US$6208 in April 2014. The Government's levy changes will save just two to three weeks of Auckland house-price inflation."

The Budget announced that anti-dumping tariffs on wallboard, reinforcing steel bar and wire nails would be immediately suspended for three years and tariffs on other materials such as roofing, cladding, insulation and paint would be dropped from 1 July 2014, to be reviewed in five years.

New Zealand: The New Zealand government is considering cutting import duties on home building materials to help reduce rising house prices in the country.

"Building material costs are too high and can be as much as 30% more in New Zealand than in Australia according to the Productivity Commission. The industry needs a shake-up through increased competition and greater transparency to ensure kiwi families can get access to more fairly priced building materials and homes," said Housing Minister Nick Smith in a statement.

Smith and Commerce Minister Craig Foss released an options paper outlining possible measures to curb the cost of house construction. The paper said that 19% of the output of the home construction industry was made up of imported content. Tariffs notionally still applied to most items used in housing construction, such as wallboard, insulation, timber products, steel and aluminum joinery, particle board and roofing materials, but adjusted tariffs - the duty as a percentage of the value - were small and diminishing due to free trade agreements. Submissions to the options paper close on 18 December 2013.

New Zealand has imposed anti-dumping duties on imports of plasterboard from Thailand since 2011, wire nails from China since 2011 and reinforcing steel bar and coil from Thailand since 2004.

New Zealand: Canterbury Earthquake Recovery Minister Gerry Brownlee has officially opened a distribution centre for Knauf Plasterboard in Christchurch. Kanuf's distribution centres in Christchurch and Auckland consists of a 5000m² warehouse, showrooms and offices.

"Knauf Plasterboard is a competitive supplier to be reckoned with having significant scale and resource to enter a dominated market. An impressive worldwide operation, with two manufacturing facilities on Australia's eastern seaboard and superior technical expertise, puts Knauf Plasterboard in a strong position to service the growing needs of New Zealand's housing and commercial market," said Mark Norris, Managing Director, Knauf Plasterboard, Australia & New Zealand.

Norris also revealed that Knauf's rollout plans will include a network of independently-owned PlastaLink Trade Centres to sell Knauf products across New Zealand. The company was selected as a partner for the New Zealand government to rebuild Christchurch in January 2013 following the earthquake in 2011.

New Zealand: A US$34m New Zealand government procurement deal to supply wallboard for the rebuilding of Christchurch has been split between New Zealand's only wallboard manufacturer, Winstone Wallboards, and multinational manufacturer Knauf. Home affordability and a lack of competition for building supplies in the country were cited by a Productivity Commission report as key issues in making the decision.

"Having Knauf set up shop in New Zealand will see increased industry competition that will provide consumers with more choice and could potentially drive down prices," said Economic Development Minister Steven Joyce. The government expects to save around 6% on wallboard costs.

Knauf, the world's second-largest wallboard manufacturer and one of only seven firms that dominate four-fifths of global production, already has a New Zealand operation, selling wool-based insulation material. The contracts will cover wallboard and associated fasteners, adhesives and jointing compounds being used in the Earthquake Commission and Southern Response Earthquake Services Limited reconstruction programmes. The contracts were let after a competitive tender that attracted nine bids.