PF Olsen log markets summary

Wednesday 10 Apr 2019

 
According to PF Olsen, at wharf gate (AWG) prices for logs delivered to ports around New Zealand decreased on average 7 NZD per JASm3 in April. This decrease in AWG prices is due to a combination of increased shipping costs and uncertainty in the China log market. While the demand for logs is at record levels, there is an imbalance between log and domestic wholesale prices. There are log vessels enroute to China from New Zealand without confirmed Letters of Credit (LCs) and Chinese log buyers are using this opportunity to try and negotiate log prices down.

The domestic market for logs has continued the very stable start to 2019. On average mills report sawn timber sales up about 5% on last year. Increases in consents for new dwellings continue to be dominated by the North Island cities, with consent numbers in the South Island down on this time last year.

Due to the drop in the AWG log prices the PF Olsen Log Price Index for April decreased $3 to $131. The index is currently $2 above the two-year average, $5 above the three-year average, and $13 higher than the five-year average.

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Source: PF Olsen


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