NZ log market - March 2026 review
Thursday 2 Apr 2026
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March At Wharf Gate (AWG) prices at New Zealand ports
increased modestly, with gains of approximately NZD 2 per JASm³
across most ports. Higher CFR log prices in China have offset rising
shipping costs.
Looking ahead, increased shipping
costs are expected to be the key determinant of April AWG pricing, as
fuel prices increase and global shipping routes remain disrupted.
Exporters continue to seek further CFR price increases in China to
recover these higher freight costs. A weaker NZD against the USD is also
providing some support to AWG prices.
Log inventories in
China remain stable; however, supply from New Zealand is expected to
ease as the industry responds to rising fuel and operating costs, which
are constraining harvest activity.
The PF Olsen Log Price
Index increased by $1 to $122, placing it $2 above the two-year average
and $1 above the five-year average.
Domestic Log
Market
The wood processing sector is wary about the
impact of rising costs on the viability of planned construction
projects. It is not only the level of cost increases that is of concern,
but also the ongoing uncertainty around future pricing, making it
difficult for developers and builders to confidently commit to new
projects.
Many forest owners are seeking increases in
domestic log prices for Quarter 2, as higher harvesting and cartage
costs continue to erode margins. In response, forest owners and managers
are attempting to share these cost pressures across the supply chain.
Harvesting and cartage costs across New Zealand have increased
significantly with fuel costs a key driver of this increase. On average,
harvesting operations in New Zealand consume approximately 4 litres of
diesel per tonne of logs produced, with a further 2 litres required to
transport logs 100 km. This highlights the material impact that rising
fuel prices are having on overall production costs.
Log buyers are therefore facing the risk of constrained supply if forest
owners reduce harvesting activity or temporarily suspend operations in
response to margin pressure. This creates a challenging environment
where rising input costs may not be fully recoverable through higher log
prices, while supply-side responses could tighten availability in the
domestic market.
China
Softwood log inventories in China are currently estimated at
approximately 3.0 million m³. Daily log offtake remains solid at
55,000–60,000 m³ per day, indicating steady underlying
consumption following the Chinese New Year (CNY) period.
Log
supply from New Zealand is typically elevated at this time of year.
Vessel arrivals are often delayed until after CNY, and some woodlot
harvesting operations aim to complete programmes before late autumn.
Supply is expected to ease from April as harvesting conditions become
more challenging with the onset of autumn weather, and reduced
productivity with fewer working days due to the Easter and
ANZAC holiday periods.
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Source & image credit: Scott Downs, PF Olsen
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