The metal markets continue to soften in Australia and New Zealand, with lower commodity prices and declining production in some key sectors. Scrap metal merchants and consumers have noted a softening in some key sectors.
With significant official cash rate rises by the Reserve Bank of New Zealand to 5.25% at present, consumer spending has slowed, impacting the construction sector and several discretionary income industries. Australia has also increased its official cash rate, which now sits at 3.85%. There is inflationary pressure in both economies; however, the contrast in physical spending during COVID has created different inflationary pressures for each to manage.
Freight rates have dropped significantly in Australia and are improving in New Zealand. Traditional offshore markets are buying at current market levels, as are local consumers in both countries, although freight to the same markets remains cost-prohibitive.