Metal markets remain strong in both Australia and New Zealand, fuelled by high LME quotations and favourable foreign exchange rates. The usual pre-Christmas clear-out is commencing for many companies, resulting in good volumes coming through metal yards. Domestic consumers are also buying at current levels before their usual shuts for the Christmas and summer holidays.
Shipping remains a real issue, with reports of shipping lines cancelling containers even after loading in some scrap metal operations. There has also been a general rate increase in December by many of the shipping lines; coupled with peak season surcharges, this means that shipping metal at present is very expensive.
The Reserve Bank of New Zealand has raised the official cash rate for the second time in as many months: now sitting at 0.75%, it is one of the highest in the OECD. It is widely anticipated by market analysts that there will be further increases next year in an attempt to cool the housing market and reduce inflationary pressure. As of December 3, the New Zealand economy is now largely open after three months of COVID restrictions. With a nearly 87% vaccination rate, it is hoped further severe restrictions can be avoided going forward.