WoodWeek – 24 May 2017

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Greetings from your WoodWeek news team. Starting with markets, New Zealand export log prices generally rose this month, as key fundamentals move in the country's favour. Demand from China was positive with imports of NZ softwood logs up by 25 percent in the first quarter, year on year.

We applaud the most recent initiative from the Marlborough Forest Industry Association. They’ve launched a new fund to attract young workers. For their group, keeping and attracting young people to live and work in Marlborough is a key issue. Forestry is growing in Marlborough, frequently ranking as a main GDP contributor in the region. It directly employs up to 900 people. However, attracting young people is a challenge.

US-owned forest management company Rayonier Inc. is “bullish” about and “encouraged” by its New Zealand operation. It had “all the planets kind of lined up last year, and we're seeing more of the same this year,” said CEO David Nunes. Speaking with analysts earlier this month, Nunes said they’ve always been bullish on New Zealand based on land productivity of the lands and market. 2016 saw a number of factors contributing to that bullishness.

Finally, log exports to Asia, led by China, are continuing to shine. It’s tempting to focus on business as usual with the trade back again, and stronger than ever, by all accounts. However, you don't have to travel far in our industry to find people who can remember the last crash in log exports and the job losses among forest contractors. I might be dreaming but … wouldn't now be a good time for industry to be working alongside our government trade and enterprise ministers and officials to look to develop and diversify our wood export trade to some of our biggest trade partners? Perhaps Rotorua MP and Trade Minister Todd McClay could support our industry more effectively through working with our industry to diversify wood product trade opportunities just as his counterparts in BC have been doing for years.

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Export log prices nudge up

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 sawmillers.

"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.

Forest products are New Zealand's third-largest commodity export group behind dairy and meat products. Exports of log, wood and wood articles increased 15 percent to $4.14 billion in the year ended March 31. The latest data for April is scheduled for release by Statistics New Zealand on Wednesday.

Source: BusinessDesk via Scoop

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Marlborough launches forest training fund

Marlborough Forest Industry Association launches new fund to attract young workers - Keeping and attracting young people to live and work in Marlborough is a key issue for the region. Reporter Oliver Lewis looks at how forestry companies are helping young workers into the industry.

Money may not grow on trees, but a new initiative helping young forestry workers and those looking to get into the industry will take away some of the costs.

The Marlborough Forest Industry Association's Vocational Training Assistance fund aims to attract more young people and advance their career prospects in the industry.

Forestry is growing in Marlborough, it frequently ranks as one of the main contributors to regional GDP, and directly employs up to 900 people. However, attracting young people is a challenge.

The associations hopes the new fund, the first of its kind in Marlborough, will help attract and retain people in the sector, by paying for things like course costs, transport and accommodation for study.

MFIA executive officer Vern Harris said there was a number of reasons why the industry was struggling to recruit young workers, pointing to the perception the industry was dangerous as an example.

Forestry was also competing against sectors like construction, mining and roading for workers; Harris also thought younger people were being pushed more towards universities than the trades.

Anyone could apply for assistance and the association was being deliberately flexible as to what it would fund, be it something like a machine operations course or books for study.

Harris said one example of what the fund could be used for was bringing a harvester simulator to Marlborough, so groups of people could train on the machine before advancing to the real thing.

More >>

Source: Stuff News

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Commercial award for Red Stag

Two Rotorua businesses have won gold at the 2017 New Zealand Commercial Project Awards.

The newly built "Mega Mill" at Red Stag Timber has won the Gold Award and Best in Category, Industrial, and the Health & Science Centre at Toi Ohomai Institute of Technology has won the Gold Award in the Education category.

Hawkins regional manager Peter McCawe said the wins were indicative of a growth in the quality of projects being built in the Bay of Plenty and Waikato.

"We have several other major projects under way in the region. It's great to see such large-scale investment into provincial New Zealand."

Red Stag Timber engaged Hawkins to build a purpose-designed structure to house the largest timber mill in the Southern Hemisphere - a project valued at more than $58 million.

Engineers Richard Spiers and Associates partnered to deliver the massive timber structure, which is a feat of engineering and construction.

The Commercial Project Award judges said "clever logistics have helped deliver this impressive production facility".

Most of the operating plant is on the first floor, atop a grid of 6m-high concrete plinths. The laminated timber superstructure has 5000sq m of floor space and a 45m span, while the roof apex stands over 18m tall.

"The building cost and total budget cost have both come in on time and under budget and the technology adapted by Red Stag Timber Ltd is the most advanced in New Zealand and Australia," said Hawkins project manager Brian Pope.

Photo: The newly built 'Mega Mill' at Red Stag Timber, right, and the Health & Science Centre at Toi-Ohomai Institute of Technology.

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Source: Rotorua Daily Post

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Forestry successes celebrated in Gisborne

Brian Deam was a popular winner of the Eastland Wood Council Skilled Professional of the Year at the 2017 awards (pictured). Held last Friday night, close to 500 people packed Showgrounds Event Centre to applaud his efforts and the others who were honoured for their work in the local forestry industry.

Now in its eighth year the Eastland Wood Council Forestry Awards have continued to attracted some stellar entries. EWC leader Prue Younger paid tribute to the thousands involved in the industry that means much to the wider region.

“These awards are a chance to celebrate the efforts of those out there doing it, but are also an important part of the on-going promotion of the industry and recognition of the continual upskilling of our workforce,” she said.

While there had been, huge inroads made across the industry, there was still plenty to work on.

Chief judge Julian Kohn said that while the region faced challenges around infrastructure, the industry was in very good health from a commercial point of view.

“We are moving into a very strong growth phase from a harvesting perspective,” said Kohn. “A lot of the plantings from the early to late 1990s are now coming up to a harvestable age, and when you look at that in conjunction with strong development in the Chinese market and to a lesser extent, the Indian and domestic onshore markets, it augers well for the future.”

“We face issues around infrastructure and specifically skilled labour for local roading. There is a serious constraint on the size of the port and capacity, which means the costs are particularly high. However, the industry is working hard alongside the port, as it has done for some years, to improve the efficiency there.”

Those numbers had improved dramatically over the past six years, but Kohn said there was still a long way to go until it became as cost effective as many of the other ports around New Zealand. Finding good skilled labour was also a challenge.

“The perception of forestry as an employment opportunity for a lot of young New Zealanders is not a positive one, so it is a harder task to attract people into a labour force competing against other industries that also faced labour shortages.”

But Kohn said the opportunities for those in the forestry were huge, with jobs spanning administration to harvesting, planning, plotting, engineering, management, planting and more.

To see full details of awards winners on the night click here

Source: Eastland Wood Council

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Rayonier bullish on forestry here

Rayonier Inc. is “bullish” about and “encouraged” by its New Zealand operation, which had “all the planets kind of lined up last year, and we're seeing more of the same this year,” said CEO David Nunes.

Speaking with analysts during a financial conference call earlier this month, Nunes said Rayonier had always been “fairly bullish on New Zealand just based in part on the underlying productivity of the lands and the access to markets.” During 2016, a number of factors contributed to that bullishness.

“I think the one area that perhaps if you want to put it into the bucket of surprises was the effectiveness of the reduction in domestic harvest in China. This has been something that's been attempted before. It's been widely reported that there was over-harvesting for a long period of time. And so, it was really the effectiveness of that domestic harvest ban and the impact then that had on the market. And I think that catalysed the market to some degree last year,” said Nunes.

On top of that, the New Zealand market was very strong, especially the Auckland market, which Nunes said “is one of the fastest-growing markets” in the region. “And so, we're seeing very strong domestic demand.” The New Zealand domestic market has taken market share from the export market, and Rayonier is now at about a 55% to 45% mix of domestic to export, he added.

“And then you also have a strong and growing market in India. So, you had all of those market factors that were taking place at the same time, while you also had low oil prices and an abundance of ships that kept shipping rates low. And then we had strong currency on top of it. So, you really had all the planets kind of lined up last year, and we're seeing more of the same this year. We've seen some increase in shipping rates. But generally, we remain pretty bullish and pretty encouraged by what we're seeing out of New Zealand this year.”

In New Zealand, Rayonier employs more than 90 forestry and business professionals as well as 700 contractors throughout the country, and harvests more than 2 million cubic meters of timber per year, sold into the domestic market and exported into Asia with China, Korea and India being important markets, the company's New Zealand website states.

Matariki Forests, managed by Rayonier New Zealand, is the third largest forestry company in New Zealand, with some 130,000 hectares of plantations across the country, according to the website, and Rayonier increased its ownership of the Matariki JV in New Zealand in 2015, taking its holding to 77% from 65%. In response to an analyst’s question during the May 4 conference call, Nunes said there were no regrets whatsoever about that decision.

The full release from Rayonier with condensed statements of consolidated income is available here.

Source: Industry Intelligence Inc

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Wood encouragement policies growing

In Australia the Forest and Wood Products Association (FWPA) reports that Increasing numbers of local governments and their peak bodies are adopting wood encouragement policies – committing them to consider wood as the primary construction material in all new-build and refurbishment projects where its use is feasible.

Councils looking to make a difference when it comes to climate change are adopting wood encouragement policies under FWPA and Planet Ark’s ‘Make it wood’ campaign.

Eleven local governments have followed in the footsteps of Latrobe City Council, which became the first in Australia to adopt such a policy. The Australian Local Government Association and Municipal Association of Victoria have also come on board.

In addition to carbon storage and reduced emissions, the benefits of building in responsibly-sourced include increased speed of construction and good thermal performance.

Beyond Australia and New Zealand, other countries where wood encouragement policies are in place include Canada, Finland and the Netherlands.

Australia boasts a number of striking timber public buildings including Surry Hills Library and Community Centre in Sydney and Melbourne’s Bayside Police Station and Library at the Dock.

More >>

Source: FWPA

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MPI opens funding round for Gisborne region

Erosion Control Funding Programme - MPI provides funding through the Erosion Control Funding Programme (ECFP) to Gisborne district landholders and community groups to help reduce wide-scale erosion problems in the Gisborne district.

Gisborne district prone to severe erosion - The Gisborne district has a severe erosion problem – 26% of Gisborne district's land is susceptible to severe erosion, compared with only 8% of all land in New Zealand.

Severe erosion causes long-term damage to the productivity of rural land. It threatens communities and rural businesses, including farms and orchards, roads and bridges. It lowers water quality by contributing large amounts of sediment to river systems, and it harms the natural and cultural values of the land and the coastal environment.

This results in a negative economic impact to the district's hill country farms, infrastructure, and high-quality land that is on floodplains.

Gisborne district is susceptible to regular high-intensity weather events that cause soil erosion and downstream flooding. These weather events are likely to be more extreme and/or more frequent. For a mid-range global greenhouse gas emission scenario, a 1-in-100 year event now could become a 1-in-50 year event by the end of the century.

Severe erosion includes large-scale gully erosion, earthflow erosion and deep- seated slumps.


MPI provides ECFP grants to landowners to fund treatments that control erosion on the worst eroding or erosion-prone land in the district. Landholders can use the grants to pay for planting trees or encouraging natural reversion to native bush.

Erosion treatments eligible for funding are the establishment of:
  • exotic forestry
  • indigenous forestry (including manuka)
  • retired grazing land to allow regrowth of indigenous vegetation (reversion)
  • space-planted poplars and willows.
Applicants for an ECFP land treatment grant must own or have an interest in the land they are planning to treat.

Two types of grants available - The ECFP was established in 1992 because the Government considered it important to address the wide-scale erosion problems in the Gisborne district.

MPI provides 2 types of ECFP grants – land treatment grants and funding for community projects.

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Tigercat to debut new harvester in June

Tigercat will debut its new eight-wheel drive 1185 harvester at Sweden’s Elmia Wood next month. The 34-tonne machine is a robust, powerful, high production harvester well suited to extreme duty clear fell applications, steep slopes and tough terrain.

The 1185 is powered by the Tigercat FPT N67 Tier 4f engine, rated at (230 kW) 308 hp. The drivetrain components, including the the pump drive, transmission and the hydraulically balanced bogie axles, are engineered and built in-house by Tigercat for extreme forest duty, long life and high uptime.

Tigercat’s unique WideRange® drive system increases working travel speed while delivering extremely powerful tractive effort for high performance in steep terrain and quick in-stand travel on good ground.

The 1185 boosts fuel efficiency through advanced hydraulic circuits. Dedicated pumps power the drive, harvesting head, crane, fan and cooling circuit functions. In addition, a closed loop drive system provides excellent performance and response on steep slopes. A pressure and flow controlled piston pump drives the cooling fan, maintaining optimal operating temperatures at the lowest possible fan speed.

The crane features Tigercat’s efficient and operator-friendly ER® technology. The hooked profile of the main boom promotes excellent right-side visibility. Not only is the crane efficient but also simple in design, without external parallel linkages. There are two stick boom options — fixed or telescopic.

With an extreme duty slew system and 360° continuous rotation, the cabin rotates with the crane. The cabin is spacious with excellent visibility and clear line-of-sight to the wheels. The curved windshield affords excellent upward visibility along with patent pending protective technology. Operators will find all the creature comforts including a comfortable and highly adjustable climate controlled seat with a four-point harness and full Bluetooth connectivity.

See more at: http://www.tigercat.com/

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Tasmania: Industry don't want forests unlocked

In Tasmania, Resources Minister Guy Barnett has urged the Legislative Council, particularly Labor MLCs, not to get in the way of the Liberals’ promise to “unlock” more forests for logging.

The State Government has introduced legislation to open up forests set aside for ­ future reserves under the former Tasmanian Forest Agreement.

The legislation to open 356,000ha of forests to harvesting is central to an overhaul of Forestry Tasmania, and the Liberals’ say the move is needed to end subsidies to the forest industry.

The forestry Bill is due to be considered by the Upper House this week.

The plan is vehemently opposed by environmentalists who say it will lead to logging of high conservation forests.

Major businesses such as Ta Ann have said they do not want the timber from the contested areas to be unlocked and the Forest Industries Association of Tasmania has expressed strong opposition to the plan.

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Source: The Mercury

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US: Investors call for climate investments

Investors Call for Climate Action through Forestry Investment - A New Forests’ investment symposium in San Francisco recently featured former VP Al Gore, the California Senate President Kevin Leon and other key leaders at the forefront of climate mitigation.

A diverse group of more than 100 institutional investors, impact investors, businesses, and NGOs gathered in San Francisco to explore investment opportunities in the forest sector that will help mitigate climate change. The investment symposium was convened on May 16 in San Francisco by New Forests, an international investment manager specializing in strategies for sustainable forest management and conservation. As the global community increasingly seeks to mobilize capital for climate solutions, the event highlighted the important role of forests in both removing and storing carbon from the atmosphere as well as the contribution of the forest sector to a rising bio-economy.

Former Vice President Al Gore opened the event with his keynote speech on the Case for Optimism in the Climate Crisis. Gore is chairman of Generation Investment Management, which has been invested in New Forests since 2008.

Kevin de León, the President pro Tempore of the California State Senate and a leader in legislative action on climate change, also spoke at the event. Senator de León noted, “California has been leading the transition to a low carbon economy for decades. We know we don’t have to choose between a healthy economy and a healthy environment. We’ve already adopted some of the most ambitious clean energy and emissions targets in the world and we’re not done yet.”

Alongside the business case for investing in forest-climate solutions, New Forests’ symposium explored the experience of Native American communities who have enrolled their forests to provide carbon offsets for California’s emissions trading scheme. Through its Forest Carbon Partners program, New Forests is currently working with several tribes in California, Alaska, and New Mexico as part of its forest-carbon investments on more than 445,000 acres of forests in the United States.

Chairman Thomas O’Rourke of the Yurok Tribal Council, who also spoke at the symposium, said, “The Yurok and other Native American tribes across the United States are taking the lead in managing forests to address our climate challenge. Partnering with New Forests to develop a forest carbon offset project on Yurok lands has supported our long-term sustainable forest stewardship, the re-acquisition of ancestral Yurok territory, and the re-patriation of important cultural heritage.”

The Forests as a Climate Solution event also highlighted the experience of foundations, corporations, and institutional investors in integrating climate impacts within their timberland investments and broader objectives to decarbonize businesses and investment portfolios. The symposium is an important step in furthering the dialogue around how to best direct private capital into forest-climate solutions.

“The forest sector, alongside renewable energy, will be critical in transitioning the global economy to a low carbon future,” said New Forests’ CEO David Brand. “We increasingly see our investors looking not only to understand the greenhouse gas emissions associated with their investments but also to understand how forestry assets in their portfolio can decrease emissions and play a role in the growing bio-economy.”

Brand continued, “We believe the emergence of new uses for timber and innovation in the forest sector will be able to provide attractive opportunities for investors while also providing the public good of climate change mitigation. Ultimately we are at a critical point in which the investment community can address the greatest challenge of our time – climate change – while still meeting their needs for financial return.”

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Canada Wood enabling export lumber to China

With regular market visits, interventions, initiatives and reports being jointly organised by industry associations alongside Canadian government leaders, the wood industry from Canada is doing plenty to facilitate lumber export growth to China.

This month, Paul Newman, director of the Council of Forest Industries (COFI) in British Columbia (the equivalent to Woodco in NZ or AFPA in Australia) reported to industry there on the singular focus of a recent meeting between government trade leaders from Canada and housing minister from China.

To quote Mr Newman, "On April 24th in Beijing I joined Minister François- Philippe Champagne’s delegation for a remarkable meeting with China's Ministry of Housing, Urban and Rural Development (MOHURD) Minister Chen Zhenggao. The meeting was noteworthy as Minister Chen had wood construction as his sole discussion item. Nor was he interested in talking generalities, his aim was to identify go-ahead strategies to accelerate the uptake of wood building nationally."

To demonstrate the long-term nature of the intended market development the Canadian officials are focused on training young Chinese practitioners on how to Canadian lumber in China's urban development industries.

Minister Chen was interested in understanding height and area limits for wood construction under current Chinese codes. Recent work by FPInnovations classifying building height distributions in key Chinese provinces and potential greenhouse gas mitigation was discussed.

Minister Champagne thanked MOHURD for recent promulgation of the tall wood building code and ability to build up to 5 stories of pure wood construction. He noted GHG alleviation would be considerably improved if the permissible heights for wood buildings were raised to 8 stories or higher; contingent on progress in fire safety research and future code design.

Both Ministers agreed that training initiatives in both wood construction and forestry should be stepped up. Canada needs to develop additional pathways into the Chinese education network in order to cater to both practitioners and students.

Photo: Tianjin’s Binhai eco-district featuring wood construction.

More >>

Source: Canada Wood market news

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... almost finally ... when good wildlife goes bad

In forestry circles its unlikely that otters were considered a safety risk ... in Scotland that might have changed after this chap's experience ... A forestry worker was chased by an otter after he found it on a road in Dumfries and Galloway.

Watch it unfold here >>

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Buy and Sell

... and finally ... Memorable school reunions

60th High School Reunion - He was a widower and she a widow.

They had known each other for a number of years being high school classmates and having attended class reunions in the past without fail.

This 60th anniversary of their class, the widower and the widow made a foursome with two other singles.

They had a wonderful evening, their spirits high.
The widower throwing admiring glances across the table.
The widow smiling coyly back at him.

Finally, he picked up courage to ask her, "Will you marry me?"

After about six seconds of careful consideration, she answered, "Yes ... yes, indeed, I will!"

The evening ended on a happy note for the widower.
But the next morning he was troubled.

Did she say Yes? or did she say No?

He couldn't remember.
Try as he would, he just could not recall.
He went over the conversation of the previous evening, but his mind was blank.

He remembered asking the question but for the life of him he could not recall her response.
With fear and trepidation, he picked up the phone and called her.
First, he explained that he couldn't remember as well as he used to. Then he reviewed the past evening. As he gained a little more courage he then inquired of her.
"When I asked if you would marry me, did you say Yes? or did you say No?

"Why you silly man, I said Yes. Yes I will ! And I meant it with all my heart."

The widower was delighted. He felt his heart skip a beat.

Then she continued. "And I am so glad you called because I couldn't remember who asked me!”

That's all for our mid-week wood news roundup.

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John Stulen
PO Box 1230
Building X91, Scion Campus, 99 Sala Street
Rotorua, New Zealand
Tel: +64 27 275 8011
Web: www.woodweek.com

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