New Zealand log market August reviewFriday 12 Sep 2025
At Wharf Gate (AWG) prices for export logs had an un-forecasted 8 NZD per JASm3 increase. This increase was more due to exchange rate and ocean freight cost fluctuations than any market improvement in China. Log demand in China has increased to around 55,000 m³ per day, with stable softwood log inventories showing a modest month-on-month decrease of approximately 4%. Demand from India remains soft as the country looks forward to increasing economic activity after Diwali. There is also a lot of uncertainty with the US tariffs. Fortunately, log volumes from New Zealand remains below normal levels, helping to balance log supply and demand. The PF Olsen Log Price Index increased to $120. This is $1 above the two-year average and $1 below the five-year average. Domestic Log Market Carter Holt Harvey has proposed closing its Eves Valley Sawmill
near Nelson and consolidating production at Kawerau. The proposal was
communicated on 20–21 August, with formal consultation running to
1 September and a final decision signalled for 4 September. Local
leaders describe a “huge” regional impact, reflecting Eves
Valley’s long-standing presence and scale. The mill processes
approximately 250,000 tonnes of timber annually, primarily serving South
Island framing markets. It is estimated Eves Valley produces roughly 5%
of the country’s total sawn volume.
The move is symptomatic of a broader malaise in the domestic forestry sector: residential building remains subdued, with dwelling consents slipping and the 12-month housing pipeline well below its 2022 peak. This has dampened demand for framing and appearance-grade timber. Processors also face elevated operating costs and global uncertainties—including currency volatility, shipping disruptions, and shifting trade dynamics, that are squeezing margins. Export Log Markets - China CFR prices for A-grade logs remain in the range of USD 113–117 per JASm³ for August vessel arrivals. Log demand in China has increased slightly over the last month to around 55,000 m³ per day. Log demand is expected to increase as economic activity increases as temperatures drop when China heads into Autumn. Log supply from New Zealand remains below normal levels so softwood log inventories have decreased slightly and now sit at approximately 2.6 million m³. The Caixin China General Manufacturing PMI slipped into contraction in July, falling to 49.5, down from 50.4 in June—a surprise reversal that dashed hopes of sustained momentum. Output shrank for the second consecutive month, dragged down by weakening export orders amid enduring global trade uncertainty. Although purchasing activity rebounded slightly after two months of decline, and input costs edged upward for the first time in five months, selling prices continued to fall, reflecting intensified competition. Business sentiment improved modestly yet remained muted compared to its long-term average. The CNY has strengthened about 1.15% against the USD which provides more buying power to Chinese log buyers. More >> Source: PF Olsen 
| ||
Copyright 2004-2025 © Innovatek Ltd. All rights reserved. |
