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![]() New Zealand log exports topped 1M cubic metres in January - New Zealand exported more than one million cubic metres of softwood logs in January, only the second time in the country's history that such a high volume has been shipped in the month. The country exported 1.1 million cubic metres of softwood logs overseas in January this year, up 32 percent on January 2017, according to data from Global Trade Information Services published in AgriHQ's monthly forestry market report. That's the highest level for the month since 2014 and only the second time volumes have exceeded 1 million for a January month. "New Zealand’s softwood log exports started 2018 with a bang," AgriHQ analyst Reece Brick said in his March report under the heading 'Flying start for log exports'. "The strong start to 2018 bodes well for the coming year, as January is historically the weakest month each year." The large export volumes in January were partly down to the later timing of Chinese New Year, which moved some of the heavy pre-Chinese New Year trading into January rather than December. New Zealand log exports in January fell 31 percent from December levels ahead of Chinese New Year celebrations, which ran from mid-February through to early March. However, the generally high level of exports this past 12 months were also a factor in lifting January volumes, AgriHQ noted. New Zealand cemented its position as China's top source of softwood logs last year, with its share of the market lifting to 36.3 percent from 34.7 percent. AgriHQ noted that New Zealand's strong presence in the Chinese log market continued in January, with imports of New Zealand logs jumping 43 percent from the same month a year earlier, and accounting for 40 percent of China's total log imports, significantly ahead of its closest rival Russia with a 21 percent share. China's demand for softwood logs has increased after Asia's largest economy clamped down on harvesting its own forests and reduced tariffs on imported logs to meet demand in its local market. "All eyes are focused on the direction that China takes after the Chinese New Year holidays," Brick said. "Activity was relatively dead over the past month, but port-level offtake in the past week or two has reportedly lifted more sharply than expected. "There’s little to show there will be any deviation from what’s been witnessed over the past 12 months and the general sentiment is for small price increases over the next two months." Forest products are New Zealand's third-largest commodity export group behind dairy and meat products. Source: BusinessDesk via Scoop
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Global Lumber Trade
Trade of softwood lumber reached an all-time-high in 2017 as demand for wood was strong in most key markets around the world. An estimated 126 million m3 of softwood lumber was shipped from forest-rich countries such as Canada, Russia, Sweden and Finland to markets with high consumption of lumber, including China, the US, the United Kingdom, Japan and Germany. Since the global recession in 2008, international trade of lumber has gone up by as much as 50%. With the economy forecasted to stay healthy in the US and Europe in 2018, this might be another good year for lumber exporters. Lumber markets – North America US softwood lumber production in 2017 reached the highest level seen in ten years. The biggest increase came in the southern states, but other regions of the country also had healthy production gains year-over-year. The higher domestic production levels resulted in decreased demand for imported lumber as US lumber consumption was up by only one percent from 2016. The strong market for lumber in the US led to record high lumber prices in both the US and Canada in late 2017 and early 2018. Lumber markets – China Over the past two years, prices for imported softwood lumber to China have been steadily rising and in January 2018 reached their highest levels since March 2015. Lumber supply from Russia and North America has generally been the lowest cost lumber imported to China, while lumber from Chile, Sweden and Finland typically is at the higher end of the price spectrum. Russia and Canada continue to be the major suppliers, but their total market share has shrunk from 81% in 2015 to 76% in 2017, with particularly Nordic mills increasing their presence in this fast-growing market. Lumber market – Japan Although lumber imports to Japan fell in the 4Q/17, the total volume for the year was up slightly for the second consecutive year. The biggest changes in supply over the past few years have been reduced shipments from Canada and increased imports from Finland and Sweden. Compared to most other major markets of the world, domestic and import prices for lumber have been surprisingly stable. .New Zealand exported a record volume of logs to China last year as Asia's largest economy clamped down on harvesting its own forests, and the future points to constant or better demand in coming months, according to AgriHQ's latest forestry market report.
The country shipped a record 18.8 million cubic metres of softwood logs overseas in 2017, up 18 percent on 2016, with exports to China jumping 29 percent and accounting for three-quarters of the total. New Zealand cemented its position as China's top source of softwood logs last year, with its share of the market lifting to 36.3 percent from 34.7 percent. China's overall demand for softwood logs increased 10 percent to 31 million tonnes as the country clamped down on harvesting its own forests and reduced tariffs on imported logs to meet demand in its local market. Upcoming changes to government regulations which will allow for Chinese buildings to be designed using New Zealand wood grades and sizing are likely to further stoke demand in the future, AgriHQ said. "Virtually all information coming out of China has pointed towards constant or better demand for NZ logs in the coming months," AgriHQ analyst Reece Brick said in his February Forestry Market Report report titled 'Optimism ever-present for exports'. Brick noted Chinese government policies and regulations are "particularly encouraging" for the New Zealand log market. "China is looking at becoming more sustainable. This has already slashed the amount of logs being harvested from native forests, while tougher enforcement of pollution policies are already clearing out the number of old and inefficient wood processors," he said. "The newest announcement has come in the form of building regulations. As of August this year, radiata pine specifications will be included in the Chinese Code of Design, allowing buildings to be designed using NZ wood grades and sizing. The immediate impact of this change is still somewhat of an unknown, but there’s no doubt it will only be positive for NZ exporters in the long-term." Source: BusinessDesk |
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