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Steel mesh makers re-test products after ComCom concern

The two Auckland companies have been told by the Commerce Commission to stop selling their steel mesh products.

Fiona Rotherham
Fri, 04 Mar 2016

Euro Corp and Brilliance Steel, which stopped selling steel mesh products because of a Commerce Commission investigation, are both conducting independent re-tests of their stock to ensure compliance with building standards.

The two Auckland companies have been told by the Commerce Commission to stop selling their steel mesh products after initial testing showed they didn't meet the standard requirements in relation to elongation, which are designed to ensure the steel stretches under pressure or movement during an earthquake.

Steel mesh is typically used as reinforcement in concrete floor slabs used during the construction of houses, garages and other buildings and can also be used for driveways and pathways.

Euro, which is owned by funds associated with Maui Capital and the McKenzie Business Trust and its trustees, has challenged the results.

Euro managing director Randal McKenzie said it was the first time in the company's 20 years in business that the standard of any of its products had been questioned. It manufactures and imports from Malaysia the ductile steel mesh under investigation and McKenzie said the product had already passed testing by a leading independent ISO accredited laboratory.

"We're pretty shocked this has happened because we take standard compliance seriously," he said.

It is meeting the regulator on Monday to discuss the results of the commission's tests.

Brilliance Steel, owned by Donghui Wu and Guanghui Wu, said it takes its responsibilities seriously and had written to customers advising them not to use or supply any stock of the ductile mesh until further notice. The steel mesh products and the wire raw material had been tested and certified to ensure compliance before sale, it said.

Neither of the Auckland companies is dominant a supplier of mesh in New Zealand. Euro sold about 380,000 sheets of the steel in New Zealand in the period under investigation which is from mid-2012 to now, while Brilliance sold about 20,000 sheets.

The Ministry of Business (MBIE) said it wasn't concerned that the steel product under investigation poses a safety risk for newly built houses and is confident it will still comply with the Building Code.

Ductile steel reinforcing mesh is used to help control cracks on concrete floor slabs and, after the Canterbury earthquake in 2011, the ductility level was increased to a minimum elongation of 10% from about 2% formerly.

"The test results of this product so far average around 8%," said MBIE's general manager building system performance Derek Baxter. "These homes will still be more resilient than the many of thousands of houses built prior to 2011. This is an issue of standards, not safety."

Still, both government departments advise the product shouldn't be used in concrete slabs that have not yet been poured while they are under investigation. And MBIE said it would need to do a case-by-case assessment if the product had been used on commercial or multi-storey buildings.

Euro Corporation said as far as it knows its product has only been used for residential construction on the ground as engineers specify a higher gauge wire for commercial construction.

Brilliance said its mesh, imported from its own factory in China, has also only been used on residential work.

Misrepresenting a product as complying with the standard when it doesn't is a Fair Trading Act breach that can incur fines of up to $600,000 per offence.


Fiona Rotherham
Fri, 04 Mar 2016
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Steel mesh makers re-test products after ComCom concern