Export Log Market: China

Wednesday 19 Sep 2018

Total softwood logs stocks in China has stayed around 3.2million m3 with some reports of a recent drop to 3.15million m3. Demand is still okay but not as strong as expected for this time of year. Daily port off-take has increased from 70,000 last month to current reports ranging from 72,000- 80,000 m3/day.

Total inventory levels have been controlled as the supply from both South America and the US has diminished. Within this inventory there are varying levels of stock at each port, and South China is proving more difficult for log exporters than North China.

Australian pine has replaced New Zealand radiata in the plywood sector which is strong in South China. The Australian pine arrives by containers and is taken direct to the factories which reduces handling costs in China. Business activity may also be somewhat subdued in South China as the weather is still quite hot and sticky compared to North China.

Most exporters are selling A grade logs in the low 130’s with very strong buyer resistance to anything over 134 USD. The lower log grades are more difficult to sell at the moment. The irony is that AWG prices for KI and KIS increased more than the higher grade in September, but this is mostly due to some exporters reducing the differential they had between the grades.

There is negative sentiment around pruned logs. The CFR sale price for pruned logs a few months ago was up to 180 USD and is now in the mid 150’s USD. The exporters are not optimistic for a strong recovery in the near future.

Source: PF Olsen Wood Matters September Report

Share |

Copyright 2004-2018 © Innovatek Ltd. All rights reserved.