WoodWeek – 7 March 2018

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Greetings from your WoodWeek news team. This week we are bringing you the news from Vancouver where we are hosting the first ForestTECHX conference in Canada alongside the team from Logging & Sawmilling Journal, our North America partners. We’ve had an excellent response from people in Canadian, American and Chilean forest companies.

First up, the export growth trend continues, as New Zealand’s foresters shipped a record 18.8 million cubic metres of softwood logs overseas in 2017, up 18 percent on 2016. Exports to China jumped 29 percent accounting for three-quarters of the total.

We know that New Zealand’s forest industry cemented our position as China's top source of softwood logs last year, with its share of the market lifting to 36.3 percent from 34.7 percent. China's overall demand for softwood logs increased 10 percent to 31 million tonnes as the country clamped down on harvesting its own forests and reduced tariffs on imported logs to meet demand in its local market. The continued strong growth begs a couple of questions – how long will this growth continue, and, will it level off or drop off quickly in response to some market change?

Wider consultation has started now that an industry group has reached a significant milestone for replacing methyl bromide as the standard fumigant for export logs and timber. Chair of STIMBR, the industry group driving change, Don Hammond, says approval by the EPA for the proposed new treatment, ethanedinitrile, is the critical first step into its use in New Zealand to ensure log exports are free of pests.

Finally, forestry on the east coast is centre stage for investments just announced for the Provincial Growth Fund (PGF). The planned $9.2 million in investments for Gisborne and Hawke’s Bay is expected to boost tourism and forestry opportunities, says Shane Jones. These regional development announcements and the billion trees program launch drew praise from both the NZ Forest Owners Association and KiwiRail.

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New record at the ports

NZ log exports to China at record levels, demand expected to stay strong, AgriHQ says - New Zealand exported a record volume of logs to China last year as Asia's largest economy clamped down on harvesting its own forests, and the future points to constant or better demand in coming months, according to AgriHQ's latest forestry market report.

The country shipped a record 18.8 million cubic metres of softwood logs overseas in 2017, up 18 percent on 2016, with exports to China jumping 29 percent and accounting for three-quarters of the total.

New Zealand cemented its position as China's top source of softwood logs last year, with its share of the market lifting to 36.3 percent from 34.7 percent. China's overall demand for softwood logs increased 10 percent to 31 million tonnes as the country clamped down on harvesting its own forests and reduced tariffs on imported logs to meet demand in its local market. Upcoming changes to government regulations which will allow for Chinese buildings to be designed using New Zealand wood grades and sizing are likely to further stoke demand in the future, AgriHQ said.

"Virtually all information coming out of China has pointed towards constant or better demand for NZ logs in the coming months," AgriHQ analyst Reece Brick said in his February Forestry Market Report report titled 'Optimism ever-present for exports'.

Brick noted Chinese government policies and regulations are "particularly encouraging" for the New Zealand log market.

"China is looking at becoming more sustainable. This has already slashed the amount of logs being harvested from native forests, while tougher enforcement of pollution policies are already clearing out the number of old and inefficient wood processors," he said.

"The newest announcement has come in the form of building regulations. As of August this year, radiata pine specifications will be included in the Chinese Code of Design, allowing buildings to be designed using NZ wood grades and sizing. The immediate impact of this change is still somewhat of an unknown, but there’s no doubt it will only be positive for NZ exporters in the long-term."

In its latest monthly survey of exporters, forest owners and saw millers, AgriHQ noted that activity in China has ground to a halt as it is the middle of the Chinese New Year holiday.

"The Chinese New Year always marks a period of uncertainty and volatility for NZ log traders, however sentiment throughout the industry remain very positive towards forwards prospects for log prices," Brick said. "Market participants are keeping a close eye on the situation there since changes over the next month will determine the medium-term direction of export log values."

Still, he said the New Zealand log market "is not all about China", citing a push for more affordable housing India that would stoke demand for New Zealand logs.

"India has shown little sign of showing any reduction in demand, and it’s thought its importance to NZ over the coming years will only grow," he said.

South Korea is the NZ's second-largest with a 13 percent share and India is our third- largest softwood log market, with an 8 percent share.

However Brick noted the high value of the New Zealand dollar was weighing on returns for export logs.

"Fundamentals are positive for logs exports – if you ignore the exchange rate," Brick said. "Unfortunately the NZD:USD is difficult to overlook as it has clambered into the US$0.73- $0.74c range since late-January and has shown little sign of retreating."

Meanwhile, New Zealand's domestic log market largely remains in the same very strong position, he said.

Forest products are New Zealand's third-largest commodity export group behind dairy and meat products.

Source: BusinessDesk via Scoop News

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Consultation to replace methyl bromide

Consultation starts on fumigant for forest industry to replace methyl bromide - A significant milestone has been reached in replacing methyl bromide as the standard fumigant for export logs and timber.

The Environmental Protection Authority has just released application details for approval of ethanedinitrile (EDN) as a fumigant for log and timber exports.

The forest industry anticipates EDN could replace methyl bromide fumigation which is used on log exports to China and India. Methyl bromide is an ozone depleting chemical. Regulations due to come into effect in 2020 will make it considerably more difficult and expensive to use.

The Chair of Stakeholders in Methyl Bromide Reduction (STIMBR) Don Hammond, says approval by the EPA is the critical first step into its use in New Zealand to ensure log exports are free of pests the importing countries don’t want.

“Over the past seven years STIMBR and our co-funding partners, including the New Zealand government, have invested more than $22 million in research on alternatives to methyl bromide, as well as ways to reduce the amounts that need to be used, along with recapture and destruction technologies,” Don Hammond says.

He says an extensive review of scientific literature commissioned by STIMBR in 2014 found only one promising fumigant alternative to methyl bromide.

“Plant and Food Research confirmed EDN is an effective phytosanitary treatment for insects which might be found on our logs.”

“There are clear advantages of EDN over methyl bromide. EDN has no effect on the ozone layer. It is not a greenhouse gas. It does not bioaccumulate because it breaks down rapidly in the environment without leaving harmful residues in the soil or in water,” Don Hammond says.

EDN is currently manufactured by Draslovka a family-owned company based in the Czech Republic. Over the past three years Don Hammond says Draslovka has made significant investment to develop EDN into a commercially viable and environmentally sustainable alternative to methyl bromide for use globally as a soil and commodity treatment.

The President of the Forest Owners Association, Peter Clark, says while EPA approval is a vital first step that doesn’t mean importing countries will automatically accept its use.

“We are confident that, with the huge wealth of positive data on EDN, that EPA will give it approval. The process of assuring other countries that EDN is both effective and safe to use, must also be undertaken as a government priority.”

“Though the value of log exports is less than half of the value of our total timber exports, 71 percent of our logs go to China, and presently methyl bromide treatment is an important component of that trade,” Peter Clark says.

“Further, all logs going to India require methyl bromide treatment. Resolving this issue is a clear priority for our industry.”

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East coast forestry takes centre stage

The Provincial Growth Fund (PGF) will invest $9.2 million in Gisborne and Hawke’s Bay to immediately boost tourism and forestry opportunities, Regional Economic Development Minister Shane Jones says.

“Gisborne and the Hawke’s Bay have been very active in drumming up proposals since the Government agreed to establish a $1 billion per annum Provincial Growth Fund and we’ll continue to work in partnership with the regions to further develop these ideas,” Mr Jones says.

“I’m pleased to be in Gisborne today announcing the first tranche of projects for a region that has huge potential to grow its economy while creating high-value jobs and lifting its overall productivity potential.

“The PGF will provide support for a broad tourism package, including $2.3 million to redevelop Gisborne Inner Harbour and $1 million toward a programme to commemorate the first encounters between Maori and Europeans.

“We’re contributing $200,000 to kick-start the creation of a $20 million Wood Processing Centre of Excellence in Gisborne, which would create 167 jobs.

“We’re also providing up to $5 million to KiwiRail to reopen the Wairoa-Napier line for logging trains, taking more than 5,700 trucks off the road each year.

“We’ll be investing in planting manuka trees to support a recirculating wetland to filter water on 80 hectares of land next to the Whakaki Lake in the Wairoa district and contributing toward the Makauri Managed Aquifer Recharge trial to combat declining water levels.

“About 49 per cent of the population of Tairawhiti is Maori and there are opportunities to increase employment and enhance Maori development and social inclusion in the region.

“There’s more to come for these regions and officials are working to identify where further Government funding could be applied. I look forward to making many more announcements in the East Coast over the life-time of the PGF,” Mr Jones says.

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Shane and the billion trees - indepth

Following last week's flurry of news on the tree planting plans being announced and cooperation by various industry organisations we have an in-depth interview by Radio New Zealand with Shane Jones.

Kathryn Ryan speaks to the minister responsible for planting a billion trees in ten years - Shane Jones, following questions on what to plant, where and who will decide. This follows urgent calls from environmentalists for natives to play a major part in a comprehensive plan which they say does not yet exist, but which needs to be implemented before planting starts this winter.

In unveiling the Provincial Growth Fund in Gisborne in late February, Shane Jones said the $ 1billion tree-planting programme is already underway. Fifty-five million trees are being planted this year, with 70 million planned next year and 90 million in 2020.

To listen click here >>

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Forest owners applaud government plan

Billion tree planting timetable gives industry confidence - Forest Owners say the announcement of the timetable for the government’s billion tree ten year project will give confidence that the massive afforestation is a serious proposition.

The Forestry Minister Shane Jones announced today in Gisborne that the government programme will see a gradual rise of tree numbers planted out every year as seedlings become available. From 2022 planting will be in full swing at an annual rate of 110,000 hectares a year.

Forest Owners Association President Peter Clark says there are plenty of sceptics who believe that the government will not get to the billion tree target over ten years.

“A billion trees represents 100,000 hectares of plantings per year on average. The effective planting start-up year, with seedlings started off this winter, will be 2019.

“So, first up, 70,000 hectares represents a good beginning to grow the national forest estate which has been static for nearly 20 years.”

Peter Clark says he predicts the also announced $6.5 million fund for Afforestation Grants will be over subscribed.

“At $1,300 per hectare the grant will cover the total planting costs for most landowners who choose to go into it. I would also hope the scheme can be expanded in future years.”

“The scheme applies to forest plots between five and 300 hectares. This could lead to too many isolated woodlots, but if farmers amalgamated their plots it would pay off in reduced harvesting costs.”

Peter Clark says he expects the next stage of the billion tree project will be to provide details of the planned species and geographical mix.

“Millable indigenous species, such as totara and beech are obviously going to be part of the mix, along with others planted to convert grassland into native forestland. But if forest plantings are to help with reducing the pain of meeting our Paris Accord commitments then we will need fast-growing exotics such as radiata pine, Douglas fir and eucalypts. It is never too early to start providing for what will be required to manage, harvest and process large volumes of these tree species.”

“Our industry is also pleased that the government is making the development of infrastructure a priority. Roads in the Tairawhiti region in particular have been in decline and this is not good for anyone using that network, including our industry. Government undertakings to fix these roads as soon as physically possible is vitally good news.”

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Canada research on Lidar updated

A model development and application guide for generating an enhanced forest inventory using airborne laser scanning data and an area-based approach Airborne Laser Scanning data — also known as Light Detection and Ranging (LiDAR) — enables the accurate three-dimensional characterisation of vertical forest structure.

Airborne Laser Scanning data have proven to be an information-rich asset for forest managers, enabling the generation of highly detailed digital elevation models and the estimation of a range of forest inventory attributes (eg, height, basal area, and volume).

Good practice guidance synthesises current knowledge from the scientific literature and practical experience to provide non-experts more detailed information about complex topics.

With this guide, the objective is to inform and enable readers interested in using Airborne Laser Scanning data to characterise, in an operational forest inventory context, large forest areas in a cost-effective manner.

To download the guide go to the Canadian Forest Service bookstore:
English guide
French guide

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New forest frustration for farmer

A man who wants to plant 25ha of forest on steep Waitotara hills is frustrated he can't be told whether the carbon it stores will earn him carbon credits.

He says Government's tree planting aim will fail unless registering for the emissions trading scheme (ETS) is easier. He intends to make an issue of it.

"If I wasn't such a determined person I would simply say 'I will just let it go'."

Neil Walker is a Taranaki Regional Council councillor with a passion to find environmentally sound and profitable uses for Taranaki hill country. He already has 110ha of forest at Nukuhau near Waverley registered with the ETS.

He wants to plant more on a 317ha block he owns in the Waitotara Valley.

He thought it would be easy. He ordered 25,000 eucalypts to plant this winter and paid a deposit. He sprayed off gorse and put in vehicle tracks.

To be part of the ETS the land has to be "new" forest - not forested in 1990. A Ministry for Primary Industries (MPI) staff member has inspected his 25ha, but can't officially say it's eligible for carbon credits until it is planted.

Mr Walker isn't satisfied. There's a process through the Environmental Protection Authority (EPA) that he can use to force an early decision - but it's expensive and lengthy and he doesn't want to do it.

"It's a big exercise to crack a nut."

He's hired a mapping expert, who has photographic evidence the land was cleared before 1990, and has been reverting and had gorse cleared since.

Mr Walker's Nukuhau forest has earned him more than $30,000 in carbon credits last year. He believes it could eventually earn more than his 250-cow dairy farm at Manutahi.

He wants eroding Taranaki hill country planted for carbon storage, and he'd like Forestry Minister Shane Jones to achieve the aim of planting a billion trees in the next 10 years.

But under the Climate Change Response Act MPI cannot assess a forest for registration in the ETS until it is planted, a spokesperson said.

More >>

Source: NZHerald

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KiwiRail welcomes Government boost

KiwiRail Chief Executive Peter Reidy says the Government's recent announcements of new projects in the Provincial Growth Fund are a strong signal of the Government’s confidence in rail’s ability to drive regional economic growth for New Zealand.

“KiwiRail is committed to enabling sustainable and inclusive economic growth and the Government’s investment in promoting rail in the regions will enable us to step up that work. This investment is a vote of confidence in our customers and our staff."

“The projects announced in February including the re-opening of the Wairoa- Napier line and the upgrade of the Whanganui line – are just the start. They are the projects that were ‘shovel ready’ and that we could begin straight away."

“The feasibility studies that were also announced in the package are an indication of the possibilities for future investment."

“We welcome this recognition of the contribution rail is making in adding value to New Zealand, not only through the efficient movement of freight and people, but in all of the areas highlighted in the recent Value of Rail report prepared by professional services firm EY.

“The benefits rail delivers include reducing congestion on roads, cutting carbon emissions, making our roads safer and lowering spending on road maintenance and upgrades.

“Together they add up to more than $1.5 billion per year, and they are a key reason for the Government’s financial investments today.

“Moving logs by rail takes pressure off the roads, and reduces greenhouse gases – each tonne of freight carried by rail instead of heavy trucks means 66 per cent fewer carbon emissions.

“The Wairoa-Napier road is not designed to cope with the growing volumes of logs now that the ‘Wall of Wood’ is coming on stream. Rail is the ideal way of getting that timber to overseas customers.

“We have estimated that using the Wairoa-Napier line to move the logs could take up to 5,714 trucks a year off the road, and reduce carbon emissions by 1292 tonnes.

“KiwiRail already transports around 25% of the country’s exports and plays a critical role in regional tourism.

“However, there is a lot of potential to increase that contribution, and KiwiRail looks forward to realising that potential.

“These promising new announcements are an important step in doing that,” says Mr Reidy.

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Economic development planned for Northland

Northport Limited welcomes the recent announcement by the Minister of Regional Economic Development, Shane Jones, about government’s intention to invest in roading and infrastructure projects in Northland, and to investigate the viability of a rail link to Northport.

Port management has indicated they look forward to working with Kiwi Rail, existing and potential customers, and other stakeholders such as local government, to explore the potential and to assess how it might complement the vision they have of how their port might grow in the future.

More >>

Source: NorthPort

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Scotland - Bid to halt abolition of forestry body

A last ditch attempt is being made not to abolish the Forestry Commission in Scotland on the eve of its centenary.

A Scottish government bill to make forestry a government department will go through its final stages at Holyrood on Thursday.

But many in the sector say it is a bad move which will see the loss of decades of forestry experience. They have written to MSPs this week urging them to vote against the bill.

George Anderson from the Woodland Trust feels that losing Forestry Commission Scotland would be a mistake.

He said, "We feel that the Forestry Commission in Scotland has been an amazing brand which is so well known. Even within the circles of land management, everyone knows who the Forestry Commission is and it's really foolish to turn your back on that kind of brand recognition.

"It's built up a huge amount of expertise and is now doing a tremendous job in what is a billion pound industry for the country and we just feel it will be really careless to lose that."

More >>

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... almost finally ... this is no joke

This story is about something that interests most of us - if not the export aspect of this success story, then the wine aspect:

New Zealand confirmed number 3 in USA wine market Surpassing several major wine producing countries, New Zealand has again been ranked the third biggest wine importer (dollar value) to the US. The US is the world’s largest and most competitive wine market.

This milestone was first reached in 2016, and statistics from the latest Gomberg Fredrikson Report show New Zealand wine has achieved it again in 2017.

Last year the total value of New Zealand wine imported to the US reached US$422 million, up 6% on 2016 and surpassed only by Italy (US$1.9 billion) and France (US$1.8 billion).

New Zealand sits ahead of Australia, Spain, Argentina and Chile. NZ Winegrowers CEO Philip Gregan says it’s an incredible achievement, given New Zealand produces less than 1% of the world’s wine.

“What began as just a few hundred thousand cases per year in the late 1990s, is now over 7.7 million cases imported to the US per annum."

“We have a reputation for premium quality and innovation. New Zealand itself is also a vital part of the success, with our sustainability practices and clean, green image very attractive to consumers, meaning they are prepared to pay a premium for our wines.”

New Zealand’s varietal offering to the United States is led by Sauvignon Blanc with a strong supporting cast of Pinot Noir, Chardonnay, Pinot Gris and Syrah.

The Gomberg Fredrikson Report shows NZ shipments of red wines to the US grew by 23% in 2017, indicating the quality of New Zealand reds, and particularly Pinot Noir, is being embraced by trade and consumers.

Overall NZ wine import volumes to the US grew by 5% in 2017.

Owner of the Gomberg Fredrikson Report, Jon Moramarco, says New Zealand Sauvignon Blanc continues to be extremely popular, with its distinctive style and flavor driving imports.

“Having said that, people are really starting to recognise New Zealand reds, and particularly Pinot Noir. While not inexpensive, the price point tends to be attractive for such high quality, and it’s something other countries struggle to compete with.”

New Zealand Winegrowers provides strategic leadership for the New Zealand wine industry and is the body that represents the interests of all New Zealand’s grape growers and winemakers.

The Gomberg Fredrikson Report looks at month by month and year by year import figures provided by the US Department of Commerce along with data from US Customs.

The US is the world’s largest and most competitive wine market. It became New Zealand’s largest export market in 2015, overtaking the UK and Australia. New Zealand wine is exported to more than 90 countries and is New Zealand’s 5th largest export good. Total exports reached $1.66 billion in 2017, with the industry working towards a goal of $2 billion in 2020.

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Buy and Sell

... and finally ... I can't believe it's not butter

British actress Emma Chambers, better known to most of us as Alice Tinker from the Vicar of Dibley television show, passed away from natural causes at the end of February.

Here are some clips which made her so priceless:

More tributes to Emma Chambers >>

Thanks for keeping up with the latest wood news with us!
Have a safe and productive week.

John Stulen

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