Log price drop impacting smaller operators
Friday 5 Jul 2019
Major estate forest owners are not considering laying off staff, despite the expectation prices will be depressed for the next two to three months. The extra Pinus radiata accumulating on China's wharves is affecting the sector nationwide but should be a ''short-term correction'' that may take until September or October to revive, Southern Wood Council chairman Grant Dodson said.
''Yes, it's the logging crews in the woodlot sector who are most vulnerable,'' he said. The woodlot sector is defined as small farm forestry investments, who are deciding not to engage contractors to cut their forest lots because of the depressed prices. ''The woodlot operators have one opportunity to cut it down, so want to avoid the [low price] trough,'' Mr Dodson said.
Mike Hurring, of Mike Hurring Logging and Contracting, in Balclutha, said all his eight logging crews were intact, relying mainly on working with corporate clients at present. ''We've been riding a good wave prior. It [price] can come back without hurting too much ... it's been pretty good for the past four or five years,'' he said of record prices achieved with mainly China. He understood three crews in Southland and one in North Otago had been laid off.
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