WoodWeek – 21 August 2019

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Greetings from your WoodWeek news team. We’ve got lots of variety in today’s wood industry update and something funny for your midweek read. We’ve also got a recent update and request for input for Scion’s 18th Log Price Outlook Survey.

The country's wood processors say the international log price war and protected overseas economies are crippling the New Zealand trade. Jon Tanner from the Wood Processors and Manufacturers Association says competing countries protect their producers. As a result of ongoing discussion here in New Zealand, the government recently commissioned an inquiry into the log market, which was looking into barriers to fairer international competition.

Mr Tanner said it was a good start. “We’ve certainly made the case for the issue. Officials are looking into what’s supporting it around the world because we really don’t understand it.” The government was also working on securing a range of trade agreements. Trade Minister Damien O'Connor expected to have agreements in principle with ASEAN member countries in place within months.

Looking back to the start of the year at the log trade globally for the January-May 2019 period, log imports to China from Russia and USA declined while those from Australia, Germany and New Zealand increased. See more details below. We’ve also got the latest SnapSTATS for you in our newest fortnightly graphical feature.

Closer to home, the New Zealand sharemarket rose as Napier Port Holdings climbed on debut, rising 13.5 percent to $3 from its IPO price of $2.60 a share.

Finally, we are still registering plenty of people from sawmills across Australia and New Zealand for our mid-September FIEA WoodTECH conference series in Melbourne and Rotorua. Also, we are chasing architects, designers, specifiers and engineers to see the latest case studies for mass timber in commercial building – register now for our WoodWORKS – Changing Perceptions Conference running in Auckland on 4 September.

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Protected economies hurting NZ wood processors

The country's wood processors say the international log price war and protected overseas economies are crippling the New Zealand trade.

The Wood Processors and Manufacturers Association told a meeting in Nelson that distortions in international trade were starting to make it difficult for local processors to be competitive globally.

The industry worked to add value to New Zealand's raw timber and supported 25,000 jobs nationwide, but it was fighting to survive.

The association's chief executive, Jon Tanner, said the global playing field was tilting less in New Zealand's favour.

That was because international competitors were playing by a different set of rules.

"And all this, we believe, is being caused primarily by subsidies that are being paid out across the world that are supporting the industries we are competing with," Mr Tanner said.

"MFAT (Ministry of Foreign Affairs and Trade) likes to call them non-tariff barriers - let's just call them the covert world of subsidies because they're really, really, really hard to see."

They were focused on finding ways to tackle the problem, but the elephant in the room was log supply and prices, he said.

The global manipulation of pricing was hurting New Zealand processors and timber growers.

The association's chairperson, Brian Stanley, said if everyone around the world paid the same price for logs, it would help their cause.

He said the onus was on government to come up with a plan that would protect regional jobs.

"People must come first and this can't simply be about providing a source of raw materials for export so that the real wealth is created elsewhere."

Mr Stanley said it was strange that New Zealand was happy to import native timbers like oak and mahogany for making furniture, yet we were not able to use our own native timber for that purpose.

"Certain New Zealand species can be sustainably managed for high grade furniture products and this would help the job opportunities for regions like the West Coast and Northland, so why aren't we doing this?"

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Source: Radio NZ

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Q1-2019: International log exports to China

German log exports to China soar - In the January-May period, log imports to China from Russia declined 26.2 percent year-over-year to 3.6 million m3 with import value dropped by 27.2 percent to $439.8 million, according to China Customs data.

US log exports to China fell 39.5 percent to 1.6 million m3, export value decreased 44.6 percent to US$338.4 million. The share of Russia in Chinese log imports slid 4.97 percentage points to 14.3 percent and share of US dropped 4.16 percentage points to 6.5 percent.

From January through May, log imports to China from New Zealand expanded 15.4 percent to 7.4 million m3 with import value surged 13.2 percent to US$1.04 billion. Australian log exports to China jumped 29.9 percent to 2.5 million m3, while average price declined 18.5 percent to US$109 per m3.

Log exports from Germany to China soared 243.0 percent to 959.0 thousand m3, average price fell 39.8 percent to US$153 per m3.

Total Chinese log imports slid 0.59 percent to 24.9 million m3, while average price decreased 12.1 percent to US$169 per m3.

Source: International Forest Industries

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Log Price Outlook Survey

Please participate in Scion’s 18th Log Price Outlook Survey. Thank you to those who suggested new areas to forecast. From the participants’ requests we updated the questions.

Start the Survey >>

Fifty-nine people from various parts of New Zealand’s domestic and international forest products supply chains participated in this outlook. These participants represent a substantial component of the NZ forestry industry. Log price decreased by $2/m3 from February 2019 to April 2019. This change results in a lower price than the February forecast, but it is in line with the 12-month forecast from May 2018. Looking forward, volumes are now anticipated to increase in the next three months, then become steady and relatively consistent.

The forecast this month looks very flat. However, this does not necessarily indicate that respondents saw about 2 % decrease, but rather that those who anticipate a decrease in log prices outweighed those expecting an increase, with a weighted average equating to 2.5% for the next 6 months (see Figure 3). Twelve months later, the weighted average resulted in 0.2% increase, showing a recovery in the market back to present conditions.

Respondents indicate 1.6% log pruned log price increase in the next 12 months period.

If you operate a business anywhere along the forestry products supply chain then please consider casting your vote in our August Outlook. All information is treated as confidential and results are reported anonymously and at an aggregated scale only. The Outlook will be shared exclusively with participants in September and will only become available publicly in October.

Please participate before Friday 30 August.

Start the Survey >>

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SnapSTAT: New Zealand log exports since 2004

Source: Figure.NZ

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Can pine forests be nurseries for natives?

Carbon dioxide-capturing pine forests could be nurseries for native trees in New Zealand - Parliament's environment select committee has heard the case for using quick-growing exotic trees, such as pines and eucalyptus, to capture carbon dioxide is compelling.

Fast and slow-growing exotic and native trees could be grown together to help New Zealand capture carbon dioxide and protect biodiversity, a Parliamentary select committee has been told.

At the third day of the environment committee's Christchurch hearings into the Climate Change Amendment (Zero Carbon) Bill, University of Canterbury forestry professor Euan Mason said the case for using exotic trees, such as pines and eucalypts, to capture carbon dioxide was compelling.

Unfortunately, indigenous vegetation grew too slowly and could not sequester carbon dioxide fast enough to allow the country to meet its emissions targets.

On warm and damp sites, radiata stands could be a nurse crop for native forest. As long as seed sources were available, the carbon dioxide reservoirs would ultimately change to become native forest, Mason said. He recommended radiata pine and other exotics be established as permanent carbon forests with the proviso that, for every 10ha of exotics, 1ha of local native stands "are either identified or established to act as seed sources for the gradual succession to native forest as carbon reservoirs".

Photo: Volunteers planting native trees at Rai Valley. About 700 rimu, t?tara, lowland ribbonwood, mata? and other native trees were planted. Native forest may eventually take over as the country's carbon dioxide reservoirs.

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Source: Stuff news

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New leader for RDO Equipment/Vermeer

Julie Whitcombe has joined RDO Equipment and Vermeer as their new Chief Operating Officer across both companies.

RDO Equipment is the world’s largest Vermeer and John Deere dealer, and in Australia RDO have an investment and strong partnership with the Vermeer brand which Julie will oversee.

Julie has a strong track record in operations and management, having spent the last nine years working for oil and gas company Senex Energy Limited, firstly as their CFO, then managing their strategic planning portfolio and most recently, running coal seam gas projects, from exploration right through to start up.

In her new role, Julie will continue to establish the RDO Equipment business in Australia and set the strategy and goals to cement our place in this market, ensuring resources are in position to meet the needs of our new customer base.

“I have big goals for RDO to become the best dealership business in Australia and am excited to support the growth of the John Deere Construction and Forestry range throughout our RDO dealerships,” Julie says.

For Vermeer, her goal is to continue to grow the brand across the country and ensure their existing customers are well looked after from sales to service and parts support.

“Vermeer is already a well-established brand in Australia, and I’m looking forward to working with a team that I’ve seen is motivated and engaged with the products to help support their growth.

“Both RDO and Vermeer are two incredible companies with the raw potential to become market leaders. I’m excited to start just as RDO comes into the Australian market, provide focus and be the glue to get everyone firing in the same direction and get the business to be what it can be,” she says.

Julie’s first few weeks have seen her visiting the eight RDO and Vermeer dealerships across Australia to meet the teams behind the great brands. Her focus will be to work with the wider leadership teams and forge plans for the next 12 months for both businesses.

Photo: Julie Whitcombe has joined RDO Equipment and Vermeer as their new Chief Operating Officer.

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Pilot project for totara wood supply

Project partners running a two-year study into the viability of a Northland Totara timber industry have unveiled a website to explain the project and its social, economic and environmental objectives.

Totara timber from Northland farms is being harvested selectively under a ‘continuous cover forestry’ model and milled as part of a two-year project to assess whether the native tree can be managed sustainably for commercial use.

The Totara Industry Pilot (TIP) project will assess the forest resource; harvest and process up to 500m3 of farm- Totara logs; collect data and research results from drying studies and trials; conduct milling trials, product and market testing; and develop and analyse the business case for a regional Totara timber industry.

The vision behind the project is of a regional industry based on the sustainable management of regenerating farm- Totara and summarised by the vision statement ‘he Totara tuturu, he iwi t? tonu’, or ‘sturdy Totara, sustainable communities’.

“TIP aims to restore the mana of this wood and improve the health and quality of Totara on private land, resulting in an increased area of native forest on farms and Maori-owned land,” said project manager Elizabeth Dunningham.

Project team member Paul Quinlan said the group wanted to see Totara valued again by landowners as it once was by Maori.

“We want to change the way landowners view this resource as something that has environmental and commercial value, something that needs to be nurtured, tended and encouraged, rather than cleared and converted to pasture,” Mr Quinlan said.

TIP maintains that a successful Totara industry will see the sustainable management of existing regenerating forest and scrubland and encourage the planting of new areas, increasing the area of native forest on private land.

The new website features a video explaining the TIP project, an overview of its objectives, a section explaining the various workstreams, an overview of the organisations involved, a comprehensive question and answer section.

“We want to change the way landowners view this resource as something that has environmental and commercial value, something that needs to be nurtured, tended and encouraged, rather than cleared and converted to pasture,” Mr Quinlan said.

TIP maintains that a successful totara industry will see the sustainable management of existing regenerating forest and scrubland and encourage the planting of new areas, increasing the area of native forest on private land.

The new website (www.totaraindustry.co.nz) features a video explaining the TIP project, an overview of its objectives, a section explaining the various workstreams, an overview of the organisations involved, a comprehensive question and answer section.

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Port of Tauranga does Ruakura logistics deal

Last week Port of Tauranga and Tainui Group Holdings (TGH) subsidiary Port Ruakura LP announced a long- term partnership to support the development of the planned Ruakura Inland Port at Hamilton.

The agreement allows Port of Tauranga's cargo trains running between MetroPort Auckland and Tauranga to service Ruakura Inland Port, giving Waikato-based importers and exporters direct access to fast international shipping services calling at Tauranga. Tauranga is the only port call for the biggest container ships visiting New Zealand.

Port of Tauranga Chief Executive, Mark Cairns, says the planned Ruakura Inland Port offers significant cargo handling capacity and scope to meet future needs. The 480 hectare Ruakura estate has 192 hectares earmarked for logistics and industrial uses including the planned 30 hectare inland port.

"The Ruakura development will provide a highly efficient rail hub in the Waikato by utilising our existing train services linking our MetroPort Auckland inland freight hub with Port of Tauranga, which is New Zealand's international hub port and the main cargo gateway for the upper North Island," he says.

"It's an excellent example of Port of Tauranga's partnership approach to providing supply chain infrastructure beyond our Bay of Plenty hinterland."

Tainui Group Holdings Chief Executive Chris Joblin welcomed the long-term partnership on behalf of Port Ruakura LP.

“The agreement will see Port of Tauranga trains initially call at Ruakura four times daily and this is likely to grow. This service will underpin the significant supply chain savings we have been modelling with prospective customers and tenants of Ruakura,” he says.

Photo: Port of Tauranga Chief Executive, Mark Cairns (left) and Tainui Group Holdings Chief Executive, Chris Joblin (right).

About Ruakura - Ruakura is a visionary logistics hub designed to help importers and exporters unlock the golden triangle. Offering genuine scale, the core of the development is a 30ha inland port which will offer direct access to major seaports via main trunk rail services and the Waikato Expressway.

Complementing the inland port is a 192ha logistics and industrial precinct offering room to grow for businesses seeking a substantial footprint, and adjoining precincts for commercial, residential and retail use.

Ruakura is long-term project by Tainui Group Holdings (TGH) and its business partners. TGH’s track record includes quality developments at The Base, one of New Zealand’s largest shopping centres, and hotels at Auckland Airport and Hamilton as part of the $950m diversified portfolio it manages on behalf of 76,000 Waikato-Tainui iwi members.

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Nelson: Pigeon Valley fire ‘accidental’

Investigation into Pigeon Valley Fire classifies it as accidental - An investigation into one of New Zealand’s largest plantation forest fires has classified the fire as accidental.

The Pigeon Valley Fire, which began on the afternoon of 5 February, eventually burned around 2300ha of commercial plantation forest, property and pastures, and had a final perimeter of 35km. A home and shed were also lost in the fire.

Fire and Emergency Principal Rural Fire Officer for Nelson Tasman Ian Reade says the report found the fire was caused by the use of farm equipment. The fire was initially sparked by an agricultural contractor discing a rocky paddock. The report found that sparks from the discing equipment - from metal on stone or metal on metal contact - ignited dry grass in the paddock. Fuelled by southerly winds, the fire then quickly spread onto a steep recently harvested hillside of forestry nearby.

"This fire proves that, in extreme weather conditions, a seemingly every-day rural activity can end up causing widespread damage," Mr Reade says, "It was the proverbial perfect storm."

The weather conditions in the area during the six weeks prior to the fire were characterised by little or no rainfall, high temperatures, and often windy conditions. The Nelson Tasman Rural Fire District was in a prohibited fire season at the time, meaning there was a total fire ban.

Mr Reade says the conditions Nelson and Tasman experienced this summer were extreme, but not unique. Parts of Marlborough, Canterbury, Otago, Bay of Plenty and Northland all had similar fire risk profiles.

For more information on rural fire safety, go to www.fireandemergency.nz/farms-rural-properties-and-rural-businesses

Fire and Emergency has also released fire investigation reports into two other fires that occurred in February at Atawhai and Rabbit Island. It is likely both these fires were deliberately lit.

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Great idea for a Father's Day gift

Volkswagen's Debuts Electric Campervan - Volkswagen has updated a 1962 Type 2 11-window microbus to produce the electrically-driven Type 20 concept. The launch of the concept car was to celebrate 20 years of innovation and the launch of Volkswagen’s new Innovation and Engineering Center in California (IECC).

The masterminds behind the Type 20 have equipped it with a 10kWh battery, a 2,500-watt onboard charger and an electric motor which produces 120 BHP and 173 lb-ft of torque — a considerable increase from the original van’s sub-50 BHP engine. Volkswagen enlisted its supercar-counterpart Porsche to develop a custom-built active pneumatic suspension that digitally raises the suspension as the driver approaches the vehicle.

Although it maintains its iconic design, the Volkswagen team did give the Type 20 a number of futuristic aesthetic adjustments. The Type 20 is painted in a retro black-on-white color scheme with orange trim and features bold blue headlights. Volkswagen also worked with Autodesk — an American software corporation — to develop the wired rearview mirror support, rims and steering wheel.

Rounding off the concept car’s design is a 720p wide-angle camera system which is integrated into the drivers-side second window which uses real-time facial recognition to identify users of the Type 20. Take a look at the Volkswagen Type 20 microbus concept in the gallery above, and see it in real life at IECC alongside a number of other VW prototypes.

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One problem with the Father's Day gift suggestion - I'd say the current model you're looking at is made from "unobtainium" ....

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Buy and Sell

… and finally … jobseeker laughs

There was a job interview for a very senior position. All the candidates claimed to be able to multi-task. So they were each asked to demonstrate this by stroking the head while rubbing the tummy in a circular motion …

The company has now called for fresh applications.


Reaching the end of a job interview, the Human Resources Officer asks a young engineer fresh out of the Massachusetts Institute of Technology, "And what starting salary are you looking for?"

The engineer replies, "In the region of $250,000 a year, depending on the benefits package."

The interviewer inquires, "Well, what would you say to a package of seven weeks vacation, 14 paid holidays, full medical and dental, company matching retirement fund to 50% of salary, and a brand new company car replaced every two years, say, a red Mustang?"

The engineer sits up straight and says, "Wow! Are you kidding?"

The interviewer replies, "Sure, but you started it."


Scientists have shown that the moon is moving away at a tiny, although measurable distance from the earth every year. If you do the math, you can calculate that 85 million years ago the moon was orbiting the earth at a distance of about 35 feet from the earth's surface. This would explain the death of the dinosaurs...the tallest ones, anyway.


Here’s some reasons to laugh right out loud. These are taken from real CVs and job application cover letters:

1. I demand a salary commiserate with my extensive experience.

2. I have lurnt Word Perfect 6.0 computor and spreadsheet progrems.

3. Received a plague for Salesperson of the Year.

4. Reason for leaving last job: maturity leave.

5. Wholly responsible for two (2) failed financial institutions.

6. Its best for employers that I not work with people.

7. Let’s meet, so you can ooh and aah over my experience.

8. You will want me to be Head Honcho in no time.

9. Am a perfectionist and rarely if if ever forget details.

10. I was working for my mom until she decided to move.

11. Failed bar exam with relatively high grades.

12. Marital status: single. Unmarried. Unengaged. Uninvolved. No Commitments.

13. I have an excellent track record, although I am not a horse.

14. I am loyal to my employer at all costs... Please feel free to respond to my resume on my office voice mail.

15. I have become completely paranoid, trusting completely no one and absolutely nothing.

16. My goal is to be a meteorologist. But since I possess no training in meterology, I suppose I should try stock brokerage.

17. I procrastinate, especially when the task is unpleasant.

18. As indicted, I have over five years of analyzing investments.

19. Personal interests: donating blood. Fourteen gallons so far.

20. Instrumental in ruining entire operation for a Midwest chain store.

21. Note: Please don't miscontrue my 14 jobs as job-hopping. I have never quit a job.

22. Marital status: often. Children: various.

23. Reason for leaving last job: They insisted that all employees get to work by 8:00 am every morning. Could not work under those conditions.

24. The company made me a scapegoat, just like my three previous employers.

25. References: None. I've left a path of destruction behind me.


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

John Stulen

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