About 85 workers at a Christchurch yarn manufacturer have lost their jobs.
Christchurch Yarns NZ Ltd went into receivership yesterday, with director Mark Abbot confirming all of its staff, some of whom had been employees for 25 years, had been made redundant.
The closure was "hard for all of us", he said.
"The New Zealand dollar has gone up 15 to 20 per cent in the last 12 months and it has effectively priced the product out of the market. It has become totally uncompetitive and that has forced a shift in the market towards nylon products," Abbot said.
First Union general secretary Robert Reid said the union representatives in Christchurch were shocked the company had failed.
They had not been made aware of the extent of the problems despite having worked with the company during difficult times a few years ago. "The workers knew nothing and neither did the union until [yesterday] when the receivers held a meeting of staff and told them the company had been put into receivership by Westpac," he said.
Christchurch Yarns NZ Ltd was originally called Christchurch Carpet Yarns Ltd and its Burnside plant was built in the 1970s. The company had several different owners before being bought by its most recent shareholders in 2004.
Abbot said 93 per cent of its product went to Australia and another 5 per cent was sold elsewhere offshore.
"For many of [the Australian buyers] we were their sole supplier. There are no other companies in Australasia who simply produce yarn. We didn't carry stock, we simply made to order," Abbot said.
The company's presence would also be missed by New Zealand wool suppliers, because it bought about 2000 tonnes of wool a year.
The company was owned by a group of mainly Christchurch investors, including NBR rich-lister Tracy Gough, who is redeveloping The Terrace retail and office precinct in the central business district with his brother, Antony Gough.
Other New Zealand yarn manufacturers have faced problems in recent years.
Almost 200 Canterbury Spinners workers lost their jobs in 2011 when it was announced the Godfrey Hirst-owned Christchurch factory would not reopen after earthquake damage.
- The Press