NZ Forest Products – November 2019 Monthly Market Report

As we head into the summer we have seen the stocks overseas dwindle and some encouragement in the logging environment as the good old western capitalism fires back into life once more.

This has brought export prices back to 90% of the 5-year average but still well away from the over-inflated pricing we saw in late 2018 early 2019. Hopefully this time we will show some control in the market place and stop the opportunist cutting down under developed timber.

The latest increase has been brought about by more stability in China and a surgency in imports from India yet again. Shipping cost has also moved south again making the AWG prices slightly more attractive. Other factors that are also affecting the current shipping prices are the volume of ships available against the current supply. Bringing a better deal to the NZ forestry owner.

In light of the above, there just might be something to celebrate this Christmas after all.

The increase in available vessels is not just due to the New Zealand and Australia’s decline in export volumes but a weak European trade index. 

Wood Consumption in China remains steady at last month’s rate of approximately 70,000 cubic meters which is average for this time of year in China which is still showing a decline in current wharf wood stocks now well below the average 4 million cubic meters possibly sitting between 3.4 and 3.6 million cubic meters.

The counter activity to that is, however, the availability of Spruce from Europe which is overabundantly available and predominantly better received.

Unfortunately, this is not all good for the NZ forester as Europe currently has an abundance of supply and at lower prices into the China market than is available from NZ and Australia.

Looking to the future I feel we are at the top price wise well for the meantime anyway. 

Keep on Hauling and looking to the future as always