Posted by Brian John on 29/04/2016 12:07:17:
I have checked the die with an M3 screw it threads okay.
I opened up the die a bit and applied some tap magic to the die : the result is still a mess. It just will not cut.
I think we can assume that the die has become blunt so I will order a new one tonight. That is the only way to find out for sure. When the new die arrives I will use tap magic every time. The lack of a cutting compound might explain why it has become blunt.
If the new die does not cut then I have a problem.
I also tried the die holder. I ordered this months ago but when it arrived it did not fit in my tailstock drill chuck. I then ordered a larger drill chuck which arrived many weeks later. At the time I was busy with something else and I never actually got a chance to use the two of them together until now. It still did not solve my problem 
I am 99% certain that a new die is required. I cut a thread on this material only yesterday with no problem.

Edited By Brian John on 29/04/2016 12:14:17
Edited By Brian John on 29/04/2016 12:15:18
Edited By Brian John on 29/04/2016 12:27:48
Can anyone advise on the correct way to cut a thread using the set-up shown in Brian's picture? I have the same type of die holder and am not clear on how it is meant to be used.
The die holder simply consists of a wide tube at one end to hold the die with a hollow narrow tube or shank at the other. The die holder doesn't have any arrangement that allows the die holder to move forward as the thread is cut. Nor is the holder obviously intended to be hand held.
A few ways of using the tool occur to me none of which seem quite right.
1. The drill chuck is wedged into the tail-stock so that it can't turn. The shank of the die holder is firmly gripped by the drill chuck. The tail-stock is unlocked and free to slide on the ways. Whilst the lathe chuck is rotating, possibly under power, the die is engaged with the end of the rod and the whole tail-stock pushed towards the lathe as the thread cuts.
2. Exactly as above except the tail-stock is locked and pressure applied by winding in the quill.
3. The shank of the die holder is loosely aligned by the drill chuck but not gripped by it. The die holder is held by hand and pressed on to the rod by moving the tail-stock. As the lathe chuck is turned by hand to cut the thread the die holder slides out of the drill chuck.
Methods 1 and 2 in my hands are likely to mangle the thread. Method 3 works but doesn't feel like "industry best practice"
I now use a more conventional sliding die holder. The way that's used on the lathe seems obvious in comparison to the simple type.
Thanks in anticipation,
Dave