NZ log market report - April 2026Friday 1 May 2026
April At Wharf Gate (AWG) prices for export logs at New Zealand ports remained unchanged from March. Higher shipping costs for log exports were partially offset by increased CFR log prices in China, along with exporters absorbing a portion of the higher freight costs to maintain supply to enable vessel utilisation and meet existing shipping commitments. Softwood log inventories in China have risen slightly, as expected, following increased harvesting activity in New Zealand during March. Inventory levels are anticipated to decline due to a meaningful reduction in log supply from New Zealand. Harvesting activity is reducing in New Zealand due to weather and forest owners, managers, and contractors responding to rising fuel costs. The PF Olsen Log Price Index remains at $122, which is $2 above both the two-year and five-year averages. Domestic Log Market Usually log prices are locked in with domestic mills for at least each quarter. In many cases mills have agreed to around a $3 per tonne increase for the higher grade structural and pruned logs. In most cases this price is agreed on month-by-month basis and will be reviewed according to the cost of fuel. The wood processing sector remains concerned about the impact of elevated construction costs on the viability of planned projects in New Zealand. While cost pressures have shown signs of stabilisation in some areas, uncertainty around future pricing, financing conditions, and overall demand continues to weigh on developer and builder confidence. This ongoing unpredictability is making it challenging for stakeholders to commit to new projects, contributing to a subdued pipeline of construction activity. The graph below shows a recovery in new dwelling consents through 2025, with annual consents increasing by approximately 9%. However, ready-mix concrete usage (an indicator of actual construction activity) declined by 4.6% in 2025 compared with 2024. This suggests a longer lag than usual between consent issuance and the commencement of physical construction. In addition, non-residential construction, which typically has a higher intensity of concrete use, continues to decline in both floor area and value. This helps explain the ongoing weakness in concrete volumes despite improving residential consent activity. Overall, this points to a two-speed recovery in New Zealand’s construction sector. Residential building, particularly townhouses and multi-unit developments, is expected to lead the upturn, while non-residential construction is likely to remain subdued in the near term due to persistent cost pressures and uncertainty around demand. China The CFR price for A-grade logs is currently in the USD 126–129 range. While exporters are offering around USD 131, the market has so far resisted breaking through the USD 130 threshold. Wholesale prices in China have remained relatively stable; however, emerging inflationary pressures, partly driven by higher oil prices, are beginning to surface. More >> Source: PF Olsen  | ||
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