Plasterboard coming back into balance after step up in manufacturing, imports

A shortage of plasterboard which caused much angst for the building industry and put the heat on dominant supplier Fletcher Building appears to be abating as record levels of supply flood the market.

Building Industry Federation chief executive Julien Leys said a combination of increased local manufacturing and higher imports is injecting an estimated 4.2 million square meters of plasterboard into the market a month which should see demand and supply come into balance by the end of October.

“Most people are not going to have to wait now more than four weeks, which compared to earlier in the year when people were talking six months in some cases – it’s way better than that,” he said.

Demand for plasterboard surged at the end of last year after Auckland came out of a five-week lockdown when businesses, including Fletcher’s biggest plasterboard factory, were shuttered during a period of record building activity.

* GIB and the competitive problems of plasterboard
* Is there a building materials goldmine in your garage?
* Shortage sees builders buy Gib board for six times retail price on Trade Me

Orders for Fletcher’s Gib plasterboard, which accounted for about 94% of the market, more than doubled from November 2021 through to February 2022, as builders piled in to secure supplies on concern they may not be able to source it in the future.

Fletcher came under fire for not being able to keep up as some Gib orders were pushed out six months, sparking vitriol against Gib’s market dominance and prompting Building and Construction Minister Megan Woods to set up a ministerial taskforce to help increase the uptake of alternative products.


Commerce Commission chairperson Anna Rawlings discusses its draft study into building supplies (video first published in August).

Fletcher ramped up production by upgrading and running its plants 24/7, and moved to control supply using an ‘allocation model’ which restricted orders to projects that were ready for installation to avoid builders overordering and stockpiling.

A spokesperson for Fletcher said the company is producing record levels of Gib, dispatching about 3.25m sqm of plasterboard a month, up from its long term average of 2.9m sqm. It’s also importing plasterboard, made to its Gib specifications, to supplement its local production.

Demand remained high, but was not at the same intensity as earlier this year and the company is seeing positive trends that the market was moving back to more ‘normalized’ levels of demand, the spokesperson said.

“All signs are indicating that plasterboard supply across the industry is close to matching real demand,” she said.

The allocation model put in place in July had helped show the true levels of demand for plasterboard, allowing the company to manage different plasterboard production lines and helping merchants better manage stock levels, she said.

“Through the allocation model we can see that the ‘apparent’ demand has weakened with many orders being pushed out or canceled due to the requirement for builds to be plasterboard ready,” she said. “Providing customers with certainty around the timing of their plasterboard delivery is our priority as it allows them to plan their builds.”

Merchant backlogs were clearing in a number of regions, and the company was moving to a lead time of about three to four weeks for residential sites that were ready for delivery, with indications that this would broadly be the case across the country by the end of October, she said.

“While we are aware there is still additional demand to be satisfied in some areas, we are confident that the supply is catching up.”

Fletcher’s chief executive of building products Hamish McBeath said he was pleased to see the supply of plasterboard was catching up with demand.

“While we continue to have a three to four week lead time for plasterboard, demand is normalizing and tradespeople can be confident they will get the plasterboard they need when they need it by working with their merchants,” he said.

McBeath said he appreciated that the supply constraints this year had been frustrating.

The company plans to keep its allocation model in place to build up sufficient stock resilience and ensure product was distributed fairly, the spokesperson said.

Fletcher’s new Tauranga plant is expected to start production in May next year and would increase capacity by 30% which the company expects will more than meet the heightened demand experienced this year.

The company plans to continue running its current plants 24/7 until production starts at the new plant and has allocated more volume to merchants in October and November in anticipation of increased demand in summer as builders look to finish projects.

The Ministry of Business, Innovation and Employment (MBIE) said New Zealand was continuing to import plasterboard at pace.

There were now 36 importers of plasterboard, 28 more than at the start of the year and 2.9m sqm had been imported into the country in the eight months to the end of August.

“Since the beginning of January, plasterboard imports have steadily increased and this trend is expected to continue through the end of the calendar year,” said Micheal Warren, MBIE’s manager system strategy and performance.

“We expect to see continued elevated levels of imported plasterboard in the coming months,” he said.

“We don’t expect shortages to continue due to increased imports and increased domestic supply of plasterboard. The industry has responded and the work of the Ministerial Plasterboard Taskforce has helped alleviate the shortage of plasterboard. “

To help uptake of alternative products to Gib, MBIE produced updated guidance on building product substitution for building consent authorities and architectural design bodies on how to respond to minor variations of plasterboard, and provided information on alternative plasterboard products, while Minister Woods also wrote to council mayors and chief executives to increase building consent authority confidence in product substitution.

Leys, from the Building Industry Federation, said there was now a better chance of getting alternative plasterboard products approved at councils.

“We are now much more diversified in terms of our building supply range, and getting more so, and at the end of the day that’s going to be what puts more resilience into the supply chain,” he said.

Related Articles

Back to top button