WoodWeek – 28 September 2016

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Greetings from your WoodWeek news team. With market news first we have updates on New Zealand export log prices. They've edged up from an eight- month low this month as demand, shipping rates and the currency remained relatively stable. Looking specifically at the larget market - China‘s log imports totaled almost 24 million cubic metres valued at US$3.97 billion in the first half of 2016. This figure was up 3% in volume and down 10% in value over the same period of 2015. The average landed price for imported logs was US$166 per cubic metre, a year on year fall of 13%.

Thousands of loggers and manufacturers converged on Vancouver, BC for three days last week for DEMO International 2016. It was the thirteenth edition of the show, held every four years by the Canadian Woodlands Forum. At a guess it would have been the biggest show yet.

According to local reports over 4,000 visitors arrived on day one alone! Your trustworthy editor was there with camera in hand. I did note a strong turnout of contractors from around the world including New Zealand, Australia, Chile, Russia adding to the strong turnout of US and Canadian loggers. Most gratifying of course was the strong showing of Kiwis with their own stand demonstrating winch assist products to very intrigued audiences from everywhere. Everyone from NZ reporting strong interest in their innovative new gear.

Here at home, wood processors push for faster trade refresh in face of foreign subsidies - New Zealand wood processors and manufacturers want the government to speed up a refresh of the nation's trade policy as other countries offer more support to their forestry sectors.

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NZ export log prices edge up from 8-month low

New Zealand export log prices edged up from an eight-month low in September as demand, shipping rates and the currency remained relatively stable.

The average wharf gate price for New Zealand A-grade logs edged up to $111 a tonne in September, from an eight-month low of $110 a tonne in August, according to AgriHQ's monthly survey of exporters, forest owners and saw millers. The price is 35 percent ahead of the same period last year.

"Export log returns look to have stabilised following the weakness observed last month, with wharf gate returns faring better than some had previously anticipated through August and early September," AgriHQ analysts Reece Brick and Shaye Lee said in their report. "Few of the key factors which influence returns at the wharf gate moved by any significant degree, leading to this steadying of the market."

Over the past month, in-market pricing through China has exceeded the expectations of some, helped by lower inventory levels than last year, AgriHQ said. While the exchange rate has varied over the past four weeks, it has averaged at a level roughly in line with the previous month, ensuring NZ dollar returns haven't been negatively affected, AgriHQ said.

Shipping rates, while fractionally up on last month, are still well below the levels reached in previous years, the report said. Shipping costs to China, the country's largest log export market, edged up to US$18.1/JAS (Japanese Agriculture and Forestry Standards), from US$17.4/JAS last month, and compared with US$22 a year ago. The cost to South Korea was little changed at US$17.8/JAS from US$17.6/JAS last month, and US$21.2/JAS a year ago, while the cost to India was steady at US$24.4/JAS from US$24.9/JAS last month and US$29.6 a year ago.

All grades of unpruned logs made marginally more at the wharf gate, with pruned logs the only export grade to record a decline in prices, due to pressure on pruned log prices in China, the report said.

"The general perception across the market is for a similar to slightly firmer end to the year, which will flow through into the start of 2017," the analysts said in their report.

Source: Scoop

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BC forest show draws big crowds

Thousands of loggers and manufacturers converged in Maple Ridge, B.C., for three days last week for DEMO International 2016, the thirteenth edition of the show, held every four years by the Canadian Woodlands Forum.

The biggest, smallest, strongest and fastest machines were on display from 130 exhibitors, dozens of which featured live equipment demonstrations of harvesters, skidders, mulchers and more.

The Faculty of Forestry at the University of British Columbia hosted the show at the UBC Malcolm Knapp Research Forest. A 3.4-kilometre loop road was built around rough, mountainous terrain, which allowed several exhibitors to showcase their steep slope equipment, ideally suited for the west coast market.

Many manufacturers launched their newest machine or attachment models, and some launched products available for the first time in Canada. Operator comfort seemed to be a common thread, with exhibitors touting new lighting, air conditioning and heating systems, larger cabs and windows and more comfortable seating.

Exhibitors featuring demonstrations of their steep slope technologies were a popular stop for show goers, and the steep terrain allowed the machines to be viewed in the environment for which they were designed. Among the exhibitors showcasing their steep slope options were John Deere, Ponsse, HSM, Volvo, and Caterpillar.


Source: Woodbusiness.ca

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Forestry star performer in NZ Super Fund report

A fall in global equities has seen the annual return of the NZ Super Fund fall to its lowest level since 2012. The sovereign wealth fund, established to help cover New Zealand's retirement costs, said on Wednesday that a drop in the June month meant its value stood at NZ$30.1 billion at June 30, an increase of 1.89 per cent over 12 months.

In 2012 the fund returned 1.21 per cent. In the year to June 30, 2015, the fund returns more than 14.6 per cent, making it one of the world's best performing sovereign wealth funds. Since the end of the financial year the fund has surged in value, climbing to NZ$31.4b by the end of August. Its single largest investment, forestry performed well. The 42 per cent stake in New Zealand forestry business Kaingaroa Timberlands, increased in value by NZ$82 million to NZ$1.49b over this period.

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Wood processors push for faster fair trade

Wood processors push for faster trade refresh in face of foreign subsidies - New Zealand wood processors and manufacturers want the government to speed up a refresh of the nation's trade policy as other countries offer more support to their forestry sectors.

Trade Minister Todd McClay plans to tilt policy to focus on squeezing more from existing free trade agreements rather than simply pursuing new deals. He argues this will be more effective in pulling down non-tariff barriers, government measures to either protect a domestic industry or prop up exports. Wood Processors and Manufacturers Association (WPMA) chairman Brian Stanley told a regional meeting in Wellington that refresh needs to be "urgent" and "substantial" because other nations are giving more support to their industries.

"In the past, New Zealand has been at the forefront of global free trade, but we need to accept New Zealand's original drive hasn't been adopted to the degree it needs to be," Stanley said. "Protectionism is rapidly on the rise again."

One of those threats highlighted at the meeting was from Japan, which plans to expand production capacity of wood building product cross-laminated timber (CLT) to 500,000 cubic metres by 2024 through government subsidies for new factories, import tariffs and export subsidies.

Associate Primary Industries Minister Jo Goodhew told the meeting a number of ministers with economic portfolios were working on the refresh, which will extend beyond the Ministry of Foreign Affairs and Trade, and that the reason more non-tariff barriers were emerging was because there were more free trade agreements.

Logs, wood, and wood articles are New Zealand's third-biggest commodity export with $3.86 billion in the year ended July 31, a 10 percent gain from a year earlier. Wood pulp and waste paper exports were up 4.3 percent in the year to $739 million while paper, paperboard, and articles rose 9.1 percent to $494 million.

Ministry for Primary Industries figures show 43 percent of the $4.75 billion of forestry product exports in 2015 were logs and wood chips, and Goodhew said there was room to lift the level of processed goods being sold overseas.

Building products CLT and laminated veneer lumber (LVL) were touted as value-add wood products New Zealand can develop to lift the value of those exports, and also in reducing costs for the country's construction sector, with the products as resilient as concrete, faster to erect, and more energy efficient.

Source: BusinessDesk via Scoop

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China log imports lift in 2016 first half

China‘s log imports totaled 23.91 million cubic metres valued at US$3.97 billion in the first half of 2016, up 3% in volume and down 10% in value over the same period of 2015. The average landed price for imported logs was US$166 per cubic metre, a year on year fall of 13%.

Of the total, softwood log imports amounted to 16.12 million cubic metres, or 67% of all log imports, a year on year increase of 4%. Softwood log imports were mainly from the top 10 countries, namely New Zealand (5.61 million cu.m, down 3%), Russia (4.78 million cu.m, up 6%), the US (1.81 million cu.m, up 12%), Australia (1.56 million cu.m, up 37%), Canada (1.19 million cu.m, down 4%), Ukraine (0.52 million cu.m, up 3%), Japan (0.24 million cu.m, up 35%), France (0.08 million cu.m, up 25%), Belarus(0.08 million cu.m, up 25%), DPRK(0.08 million cu.m, up 25%).

Softwood log imports of these above-mentioned countries make up 99% of all softwood log imports. Softwood log imports from the top 5 countries account for 97% of all log imports. The average price for softwood log imports was about US$120 per cubic metre in the first half of 2016, a year on year decline of 7%.

Source: International Tropical Timber Organization

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UC engineers test new drone technology

The University of Canterbury’s (UC) Spatial Engineering Research Centre is helping to lead the way in the development of drones for NZ industry, due to the activation of a new test range for unmanned aerial vehicles (UAVs).

In 2015, the Spatial Engineering Research Centre (SERC) was awarded nearly 100 square kilometres of airspace, located on the south-west side of Banks Peninsula, by the Civil Aviation Authority (CAA) to be used as a segregated airspace UAV test range. In July this year, after many months of preparation, the test range was activated for the first time.

SERC Senior research engineer Kelvin Barnsdale says the need for this test range was driven by the development of ‘beyond line of sight’ drone technology and subsequent regulatory issues.

“Drones have moved from a toy to an industry tool and are becoming much more capable of flying themselves. To regulate this, we have been working with the CAA to develop new rules for operating drones, which came into effect in August 2015.

“However, one of the enduring limitations of the new rules requires drones to be used within line of sight of the pilot. The CAA doesn’t call these unmanned aerial vehicles – they treat them as remotely piloted, which is a significant difference. So to test new airborne technology that goes beyond line of sight, we needed a segregated test range.”

The test range is a block of restricted airspace that, when activated, legally excludes any other aircraft in that area. Crucially this allows SERC to fly drones above the regulation 400 feet and beyond line of sight under special conditions.

Mr Barnsdale says this enables researchers and industry partners, in New Zealand and abroad, to test and verify UAV technology at high altitudes in a safe environment – the only restricted airspace in New Zealand for this purpose.

“We are currently working with New Zealand industry and exploring partnerships with organisations in Australia, the US and Europe due to their specialisation in beyond line of sight technology.

“This covers a range of uses, from structure inspections and agricultural intelligence-gathering, to marine biology surveys and the development of search and rescue drones in a marine environment. We are also currently using the test range for instrument trials, working towards the use of drones for high altitude atmospheric research over the Southern Ocean and Antarctica.”

Aeronavics Technology Development Manager Edwin Hayes says opportunities for testing new technologies are critical for developers of high end UAV solutions.

“Challenging operations such as flights ‘Beyond Line of Sight’ can only be fully tested with access to segregated airspace. Aeronavics expects to use the test site for investigating a wide range of UAV applications, including in the important precision agriculture sector, as it continues to collaborate with UC.

“Since the number of locations worldwide suitable for such testing is limited, the site provides the New Zealand UAV industry a competitive advantage, as well as making the university a great place to base UAV research."

The first official flight was made by a New Zealand made Aeronavics NAVI to a height of 1000 feet above ground. The flight, including the landing, was fully automated and monitored by a chase drone at lower levels.
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STIMBR annual meeting planned for November

STIMBR is an industry body funded from a voluntary levy on phosphine and methyl bromide. STIMBR is seeking to find alternative phytosanitary treatments to methyl bromide and technologies to manage methyl bromide emissions.


This year the STIMBR Annual General Meeting is planned for Thursday 24 November 2016 from 10:00am to 11:30am

Venue: Classic Fliers, 9 Jean Batten Drive, Mount Maunganui

The AGM will be followed by an Annual Research Update from 11:30am to 4:00pm

For more information contact Ian R Gear, Executive Officer & Research Director on 021 988646

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Specialist speaker for ForestTECH conference

Beautiful Trees. Valuable Wood. How an Australian company has established a successful niche in high value hardwood timbers – investment, management, processing and sales. Jon Lambert, General Manager, Heartwood Plantations

ForestTECH 2016 will again be providing local forestry companies with a timely, a unique and an independent overview of new data collection tools (including data collected and being processed from UAV’s) along with assessments of systems for better measuring, managing and analysing this resource information. In addition, case studies from leading businesses on how they’re integrating this information into their own inventory systems, day to day operations and planning and the very latest results from Australasian remote sensing research and trials are going to be showcased in this November series.

As part of the Australian leg of the series, an after dinner presentation has been set up for ForestTECH delegates. In an industry often dominated by larger softwood forest owners and managers, a presentation from a very successful high value hardwood timber company will be made.

The company, Heartwood Plantations was set up in 1995 and is providing professional forestry services to investors and organisations across Victoria. It specialises in high-value timber investments. It manages over 40 plantation sites, predominantly located in Gippsland as well as managing timber harvesting and sales exceeding 60,000 tonnes per year.

In addition to managing investors and the forest estate, the company’s success can also be put down to setting up close partnerships and working alliances with businesses like the saw milling and timber sales company, Radial Timber Australia. The process of radial sawing was specifically designed to maximise the recovery of sawn timber from smaller logs with the company being the only commercial radial sawing mill in the world.

Full details on the ForestTECH 2016 programmes – for both New Zealand and Australia, can be found on the event website, www.foresttech.events.

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Safety Alert: Dead or Rotten Trees

The following notice was released by Pan Pac Forest Products, and is a good reminder for all forest contractors:

As we move into high stock stands we are finding more and more dead standing trees. Ensure a complete hazard assessment of all dead or rotten trees is carried out in your immediate falling area.

Look out for interlocking branches as the top could break and fall back towards you. Fall all trees in the direction of the lean.

Place wedges by hand only. No hammering as this could break the top out of the tree from the vibration.

Ensure a good escape route is established.

R/T “call up” on each dead tree before cutting and again when felled successfully.

If you have any doubt whatsoever, call for assistance.

Click here for the downloadable PDF version of this Safety Alert.

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Win for small sawmill firm against Chinese copycat

In March 2014, a family-run engineering business in north-eastern Victoria awoke to a nightmare. The company's highly successful portable sawmill — exported to more than 100 countries worldwide — was featured on a Chinese website. But it was not their website and it was not their machine, but a near exact imitation.

"We've always been concerned that there'd be a copier in somewhere like China," Lucas Mills co- owner Warren Lucas explained. "Matt, who is my right-hand man, spends a lot of time on the internet just keeping an eye on what our competitors are up to. And he found a company that was even advertising it basically as a Lucas Mill."

The company sought urgent advice from a Melbourne patent attorney firm. "There has been a long-standing problem of Chinese companies infringing patent rights of foreigners," Tracey Hendy of FPA Patent Attorneys said.

But getting evidence that would be strong enough to challenge the counterfeiters in a Chinese court of law was a daunting and difficult task. So the Australian legal team joined forces with Chinese patent lawyers and, crucially, a private investigator.

His role was pivotal. He learnt that a counterfeit machine had left the factory in China and was in a large dockside warehouse ready for export. In a nail-biting sting, the Chinese customs authorities swooped. When the shipping container was opened it revealed a portable sawmill that was almost an exact copy of the Lucas machine. Right down to the green and yellow livery.

"The machine itself, even the gear box was a direct copy," Jenny Lucas, who runs the business with husband Warren, recalled. Husband Warren continued the story.


Source: ABC News

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Can stalled forest investment be restarted?

In Australia, existing plantation areas are shrinking and new investment has stalled. Rod Keenan examines the economic, environmental and social drivers behind the need for better plantation policy in Australia and the innovative investment models required.

Forest plantations have been part of the Australian landscape since the early 1900s. Australia’s two million hectares of softwood and hardwood plantations provide more than 80 per cent of the country’s wood for forest products industries. Wood demand is continuing to grow with our increasing population and will potentially rise further in a carbon-constrained economy. Some argue that plantation timber should completely replace native forest harvesting. But plantation investment has stalled and there have been few new plantings in Australia since 2008, raising the question of whether plantations in Australia can meet a growing local and global demand for wood? And if so, how?

In 2002, the author chaired a national conference on plantations. At that time, plantation policy was driven by the 2020 Vision to treble the area of plantations from one million to three million hectares. We felt that most technical issues for plantations had been addressed and that the challenges had moved on to other dimensions, including improving biodiversity and environmental outcomes and addressing community needs and concerns. It’s timely therefore, to take stock of how we have fared.

Plantations expanded rapidly from the 1950s onwards. One million hectares of pine plantations were established, largely on converted public native forests, by state forest agencies with financial support from the Federal Government. In the 1990s in Victoria, and later in Queensland, the public pine estates were sold off to international investment firms and pension funds.

In 2002 we were at the peak of a wave of private investment in hardwood plantations on agricultural land that began in the early 1990s, primarily through companies operating managed investment schemes (MIS). The global financial crisis that began in 2007 saw the demise of these MIS companies, which became highly dependent on cheap debt and the tax advantages of this investment.

International investors acquired many of these MIS estates and most of Australia’s plantations are therefore now largely under private ownership by larger international and national investors. With strong local housing markets and high international demand, plantations in the right location and growing conditions are generally making good returns for their owners.

More >>

Source: Rod Keenan, University of Melbourne

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Buy and Sell

... and finally ... something for a chuckle

"Police in Australia are searching for a group of men seen releasing live crocodiles into a school building. Though, if you ask me, they should probably be searching for the crocodiles." - (Late night talk show host)


The proud father brought home a backyard swing set for his children and immediately started to assemble it with all the neighborhood children anxiously waiting to play on it.

After several hours of reading the directions, attempting to fit bolt A into slot B, etc., he finally gave up and called upon an old handyman working in the neighbours yard.

The old-timer came over, threw the directions away, and in a short while had the set completely assembled.

It's beyond me," said the father, "how you got it together without even reading instructions."

"To tell the truth," replied the old-timer, "I can't read, and when you can't read, you've got to think."


Little Johnny was in the classroom bored to the back teeth on a Friday afternoon, and the teacher decided to have a game for the kids to get them thinking.

"Okay class. Now I'm going to say a famous quote, and the first person to tell me who said that quote, can have Monday off." said the teacher.

"Who is credited with writing the phrase, To be or not to be, that is the question?" asked the teacher.

Little Pham Lam Nguyen at the front of the class called out, "Shakespeare".

"Well done!" said the teacher, "You can have Monday off."

"No thank you Miss. I am of Vietnamese origin and it is in our culture to study as hard as we can, so I will be here on Monday studying hard." said Little Pham Lam Nguyen.

"Well okay," said the teacher. The next quote is, "I had a dream!"

Little Fri Sum Kat also at the front yelled out "I bereiva it was Martin Ruther King!"

"Well done!" said the teacher. "You can have Monday off"

"No thanka you miss I am of Chinese oligin and we also do not take time offa school. Education is evelything to us, so I will be in on Monday studying hard too." said little Fri Sum Kat.

"Okay," said the teacher. Then she heard a voice from the back of the classroom, "F***ing Immigrants!"

"Who said that?" yelled the teacher in an angry tone.

"Donald Trump!" yelled little Johnny. "See ya Tuesday .........."

Have a safe and productive week.

John Stulen

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