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Arbor Resources Blog Updates

​Chinese imports of softwood and hardwood wood products will be
significantly altered in 2022 if Russia’s log export ban is implemented
China is the world’s largest importer of softwood and hardwood logs, and for many decades,
Russia has been a significant log supplier for them. This relationship may change in 2022
if Russia implements their proposed ban on exports of softwood logs and valuable
hardwood logs, while also introducing export taxes on green lumber. All these policy
changes are designed to encourage increased domestic production of higher-valued forest
products.
The Russian parliament has not yet announced the final legislative proclamation, so it is
not clear if there will be a complete or phased-in ban, a significant export tax, or even the
possibility of a state-owned export monopoly. However, a signal has been sent to the
marketplace that Russia will no longer be a major supplier of softwood and hardwood logs.
One consequence of this decision is that Chinese wood manufacturers will need to explore
new long-term log supply regions.
In 2020, China imported almost 6.5 million m3 of logs from Russia, predominantly
softwood species. The trade was substantially less than in any year during the past two
decades. Nevertheless, Russia was still the largest supplier of hardwood logs to China in
2020 (more prominent than any other source of temperate or tropical logs) and the thirdlargest
supplier of softwood logs.
It is crucial to keep in mind that China has shifted from sourcing logs from Russia to
European suppliers the past few years as insect-infested timber in Central Europe has been
in temporary abundance. From 2018 to 2020, softwood log imports from Europe increased
from 1.3 million m3 to 12.3 million m3, while Russian-supplied logs fell from 7.8 million
m3 to 4.2 million m3. However, shipments from Europe are not sustainable long-term.
According to the just-released study by the consulting firms Wood Resources International
and O’Kelly Acumen (Russian Log Export Ban in 2022 - Implications for the Global
Forest Industry), China is expected to source more sawlogs from Oceania, Europe, and the
US short-term. Longer-term, the study anticipates that China is likely to shift further from
WRI Market Insights 2021
- a subscription service from Wood Resources International
Global Sawlog Markets
Wood Resources
International
importing logs to lumber, thus creating opportunities for lumber manufacturers, mainly in
Europe and Russia, to increase shipments to this growing market.
The excerpt above is from the just-released Focus Report “Russia Log Export Ban in 2022 –
Implications to the Global Forest Industry”, published by Wood Resources International LLC
and O’Kelly Acumen. For more information about the study or to inquire about purchasing the
60-page report in easy-to-read slide format, please contact either Hakan Ekstrom
(hakan@woodprices.com) or Glen O’Kelly (glen.okelly@okelly.se). A Table of Contents of the
report is available on our website. Click here!
Contact Information
Wood Resources International LLC
Hakan Ekstrom, Seattle, USA
info@WoodPrices.com

May 26th, 2017

26/5/2017

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Driven by strong building activity onshore, the insatiable appetite from China for logs and lumber, the weaker NZ dollar and favourable shipping rates, the NZ forestry industry right now is looking in good shape. For the year ending March 2017, exports of logs wood and wood products from the country had increased 15% to NZ$4.14 billion. Providing the global political environment remains stable, the immediate outlook both for domestic and export sales also looks to be positive. 
​
NZ log prices advance as forestry hums

New Zealand export log prices generally rose this month, as key fundamentals move in the country's favour, AgriHQ said. Prices lifted through all unpruned export log grades this month, while pruned logs experienced some minor weakness, according to AgriHQ's monthly survey of exporters, forest owners and saw millers. 

"The key fundamentals at the wharfgate have swung ever so slightly into NZ exporters' favour," AgriHQ analyst Reece Brick said in his report titled 'Forestry sectors keeping humming'. 

Shipping rates advanced by a small margin but appear to have plateaued and may ease in coming months, exchange rates had moved in New Zealand exporters' favour, and demand from overseas markets was good across the board, he said. 

Demand from China, the country's largest wood export market, was positive with imports of New Zealand softwood logs up by 25 percent in the first quarter of this year, compared with the same period last year. 

"China is still displaying very good interest in logs, as it has throughout this year so far," Brick said. "Chinese log imports are tracking at quite a high level. Thankfully this has been matched by an equivalent lift in offtake at ports, which has prevented log inventories from ballooning out and subsequently impacting on pricing. 

"It's not often that demand will fall back significantly from this point in the year, which bodes well for the coming months." Brick said there's little to suggest either the export or local log markets will suffer from any significant weakness in the future. 

In the domestic log market, he said "all demand fundamentals remain well placed, and it's difficult to imagine a scenario where they'd move away from their current path. There is some slight slowing reported among the construction sector, but this is related to the seasonal change in weather rather than any pure market weakness." 

Persistent rain over the central North Island through much of April and early May had made access to logging sites more challenging and disrupted supply, helping lift prices for the majority of key grades collected by AgriHQ by $1 a tonne. 

Good quality pruned logs were recovering after easing through late 2016, and roundwood had climbed to its highest level since AgriHQ records began in early 2002. 

Source: Scoop
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    Author
    ​FRANK T DAVIS 

    A SURLY AND CYNICAL OLD CURMUDGEON WITH A JAUNDICED VIEW OF THE POLITICAL ELITE .

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