NZ forestry monthly report - September 2025Friday 26 Sep 2025
Indeed, my check of historic pricing suggests wharf gate prices for export logs have rarely moved outside of a $10 per cubic metre band in the last 2 years. This might even be regarded as a small miracle, given the world disorder and chaos that has emerged from President Trump’s economic mis-management. China consumption has been steady at 55,000 to 60,000 per day for the first half of September. Most commentators are suggesting an October lift in demand and possibly prices as Autumn weather allows more productive outputs. Against that potential is recent news of some Letter of Credit (LC) issuing companies pulling back having sustained some big losses on trade defaults. As at mid-September, there is some suggestion of downward price pressure as LC’s and contracts become harder to settle. Most are saying this is a short term “blip.” China growth data statistics suggest a broad improvement in purchasing activity adding to positive economic gains whilst rising unemployment is a sign of slow trickle-down effect. Other data shows accelerated input costs and weaker sales prices across key sectors. A recent weakness in the value of the Yuan against the US$ is helping to maintain sales prices for exports netted back to China manufacturers, but also helps drive up imported prices for logs, as an example. Within this diverse mix of positives and negatives, most commentary is suggesting business confidence has strengthened to a 6-month high so in the longer term should help Radiata pine log prices to remain stable to strengthening. India is also showing a combination of positives with inventory low, log prices stable to very slight improvements and most commentators remaining reasonably at peace with the world. Current demand and sales are in good alignment, with 7 vessels of softwood logs delivered in each of July and August, with a total of 8 expected in September. A total of 10 vessels are forecast for October. This is potentially a worrying sign of oversupply when India also takes a 10 – 15 day holiday to celebrate the Diwali festival. Whilst this suggests the supply/demand planets will be out of alignment, history shows the festival brings confidence and increased sales on either side of it, so broader medium term trade levels are likely to remain stable. Like China, India manufacturing confidence remains subdued on the back of uncertainty as to where US Tariff levels will land and how they will impact sales. What is becoming clear is the severe strain on the US economy under the previously referred to economic miss management... More >> Source: Laurie Forestry  | ||
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