7 Jun 2017

China disqualifies steel-testing lab after NZ warning

8:21 am on 7 June 2017

Chinese regulators have disqualified a steel-testing laboratory for using false accreditation, after being alerted by New Zealand investigators.

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A file photo of steel: The China National Accreditation Service said a lab had carried out tests it was not allowed to do. Photo: 123rf.com

That comes as the Commerce Commission in New Zealand continues looking into a complaint that Fletcher Building sold substandard rectangular hollow steel (RHS) beams, a very common structural product.

The China National Accreditation Service (CNAS) said the lab at Dalian Steelforce Hi-Tech had falsely used the accreditation of another lab to do tests it was not allowed to do.

It is not clear if these tests related to RHS steel.

Fletcher subsidiary Easysteel, along with Steel & Tube, have both issued Dalian's certificates to customers who bought RHS steel in New Zealand.

Fletcher said it was confident the steel met local standards and Steel & Tube made no comment.

Steelforce, which owns Dalian Steelforce Hi-Tech, said all its products sold in New Zealand were tested at CNAS-accredited laboratories "without exception", and complied with local standards.

Steelforce chief executive Rod Corkill did not say how long the lab had been using the accreditation found to be false.

A customer who bought RHS from Steel & Tube had it tested last month and the results differed markedly from what the Dalian Steelforce lab issued.

Dalian approved the steel sample's strength in mechanical tests, while the New Zealand lab failed the RHS for two out of three strength measures.

Standard benchmarks are a tensile strength of 500 and a yield strength of 450 but the lab rated the steel at 476 and 424 respectively. That compared to Chinese-lab test scores of 540 and 510.

A separate lab in China did the chemical testing. Those results, and the comparable New Zealand ones, were all above standard but were also markedly different.

In five cases, the local tests showed twice as much presence of chemical elements such as boron, which makes steel harder to weld, compared to the tests in China.

This is the second lot of such testing. The first involved Easysteel-supplied RHS and also had different results from the China ones.

Fletcher Easysteel general manager Hamish McBeath said Steelforce was a "large, reputable Australian supplier that has supplied RHS steel to the New Zealand and Australian market for many years".

"Easysteel is confident the RHS steel provided by Steelforce meets New Zealand standards," he said.

Another big distributor, HJ Asmuss, said it had a long-standing relationship with Steelforce.

"I also know that in this investigation the integrity of Steelforce product in terms of mechanical, chemical composition and specification compliance is not in question," Grant Bradford of HJ Asmuss said, before the news of the lab being disqualified.

Many more samples would be required in New Zealand testing for them to be definitive.

Fletcher said it was unfair for RNZ to single it out, as Easysteel was only one of several New Zealand companies that bought RHS from Steelforce.

Easysteel is, however, the subject of an investigation by the Commerce Commission, after the complaint last October.

Fletcher told the commission it independently tested Steelforce RHS at local labs. It declined to outline this testing regime to RNZ.

In a statement, Steelforce's Rod Corkill said the regulator "considers these products safe and fit for use, as evidenced by their continued availability for sale and the absence of a Commerce Commission or MBIE instruction to not do so".

The Australian Financial Review has reported that Steelforce, a $300-million-a-year business, was being lined up by its owners to bring in an overseas partner.

The Commerce Commission said it was some weeks away from finishing its investigation.

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