What would you rather? New Zealand jobs in a premium product or cheap materials? The aluminium extrusion industry says the government's decision not to impose a safeguard on imports may have signed the New Zealand industry's death warrant. Under advice from MBIE, the government has rejected a request to give special temporary protection to the aluminium extrusion industry in the face of growing competition from offshore.  

The industry, which manufactures aluminium into products such as windows and door frames, had asked the government for what is known as safeguard protection measures to give it time to adjust to the competition. However, Minister of Commerce Cameron Brewer decided the threshold for a safeguard measure had not been met, which is interesting because the MBIE report noted that the domestic industry had suffered serious injury in recent years. It also said the increase in imports was one source among many, including a contracting domestic market and cost increases. It said while a safeguard measure might help the domestic industry in the short term, it would be likely to raise prices for consumers and would not support New Zealand's trade goals. 

However, it was odd because the industry, who was talking to Mike this morning, said that the MBIE officials had asked them to investigate taking a dumping case. Clearly MBIE thinks that there is a case there, or at least a case to be made, but in the meantime, they're not willing to put in the safeguard protections.  

Dave Slomp, Managing Director of McKenney Aluminium Solutions says what they need in the short term to look after jobs and to ensure that a quality world class product remains on the market. 

"We operate at world-class levels of quality, service, productivity, the envy of the world, and we're an industry that services the New Zealand market extremely well. And what we're seeing here is Chinese extrusion being landed in New Zealand for less than what extruders pay for the raw billet that we make extrusions out of." 

When you are bringing in a product for less than the price of the material in the home country, that is dumping, pure and simple. You would have thought it was an open and shut case. He said it's going to put the country's manufacturers' skilled jobs and critical industry capability at immediate risk. And all very well and good for those of us who want to buy aluminium extrusion products thinking, "Oh yay, they're cheap as chips because the Chinese are dumping their products here." What happens if they decide they're not going to? What happens if they decide that New Zealand's not a market worth bothering about?  

We won't have the product at all because our premium product, our New Zealand made product, will have shut up shop. We've been here before with the imported peaches versus homegrown. The government found that Chinese peaches were in fact being dumped into New Zealand following an investigation of claims made by Heinz Wattie's last year. Again, goods are considered to be dumped if they're exported for less than their normal value in their home country.  The peach industry just took an absolute hammering when all of the imported produce turned up, and despite the fact that tariffs were put on, it was all far too late for the peach growers.  

But ultimately, Heinz Wattie's said we won't be able to can New Zealand peaches because of a declining demand for canned peaches of New Zealand origin. It's a premium product, just like our New Zealand aluminium extrusions. Premium, costs more, and consumers decide with their wallets. The consumers ultimately decided they'd rather have the cheaper imported fruit, and that was the end of the premium product. That's the rub. Ultimately, the consumer will decide. If you're a customer, if you're somebody who is buying aluminium extrusion products, do you want the cheaper or do you want New Zealand aluminium industry safeguarded? 

And I can't understand if MBIE is saying to the industry, "Go ahead, put together a dumping case." Surely, it's incumbent upon them to put safeguards in place to protect the industry while the case is considered. As a consumer living in a free trade world, do you want the cheapest available goods that are on the market globally, or is there some merit in paying more to keep New Zealand jobs here?