Friday Offcuts 21 June 2019
Government incentives to plant trees has seen the median price of forestry farms in NZ rise by 45 per cent over the last year from NZ$6,487 per hectare to NZ$9,394 per hectare. Lands Minister Eugenie Sage told Parliament’s primary production committee that the so-called forestry encroachment was best handled by local Councils and that the National Environmental Standard for Plantation Forestry should be steering tree planting into steeper or more erosion-prone areas rather than productive farmland. Because of the group’s momentum and recent media coverage, Forestry Minister Shane Jones mid-week front footed the issue. Shane's message - foreign buyers aren’t investing "dollops of dough" into forests and displacing rural communities. He's also cautioned the lobby group to remain politically impartial. Coverage on this issue is contained in several stories we’ve included into this week’s edition.
In timber construction this week we have an announcement (yet another) which if it comes off, will see the world’s tallest wood residential tower and the largest passive house project in the world. It’s planned to be built in Vancouver, it’s expected to stand 30 to 40 storeys tall and would use B.C. manufactured and processed mass timber. Out of the US we also have news on the first dowel-laminated timber building that’s just been constructed. This new building system is a mass timber product (like CLT) but it’s assembled using friction-fit wood connectors. It doesn’t use nails, glue, or fasteners to hold it together. Check out the story below.
And finally, for harvesting contractors, forest managers, forest owners and equipment and tech providers to the logging industry who’ll be travelling into Rotorua, New Zealand next week for HarvestTECH 2019, it’s going to be a full house. You’ll be joined by logging contractors and tech providers from across Australia, Canada, the USA, Brazil, Chile, Finland, South Africa and Papua New Guinea. It’s going to be the largest gathering of its type yet seen in this country. We’re looking forward to catching up with many of you next week. That’s it for this week. Enjoy this week’s read.
This week we have for you:
Forestry encroachment an issue for councilsForestry encroachment onto higher-value farm land is an issue for councils to manage, New Zealand’s Lands Minister Eugenie Sage says. The national environmental standard for plantation forestry doesn’t set out to encourage forestry on good farm land and should be steering planting into steeper or more erosion-prone areas, she told lawmakers yesterday.
Sage told Parliament’s primary production committee that she is aware of concerns of some mayors about the level of new planting being proposed in their districts. The Overseas Investment Office is trying to get “a good handle” on what is happening, she said, but the Resource Management Act and the national environmental standard for plantation forestry are the key tools for managing where planting takes place.
“It’s up to councils to determine what rules they put in their plan, that may make it easier for forestry to occur there - consistent with the NES - or harder.”
The government has launched a 10-year programme to plant a billion trees to help soak up carbon emissions and enlarge the country’s forestry and wood processing industry. But the potential land that may ultimately be required – estimated at up to 2.8 million hectares by the Productivity Commission – has alarmed farming groups and been dismissed as un-doable by some foresters.
Last month, Wairoa mayor Craig Little said the government’s subsidies for forestry had seen 8,000 ha of the district’s farmland sold in four months for planting with trees. Each time a farm is taken out of production, about five jobs were lost, he said.
The Overseas Investment Act was amended last year to make it easier for overseas buyers of land wanting to convert it to forestry. The committee heard that eight sales have been approved under the special pathway for forestry, with another 19 in the pipeline.
Sage acknowledged that the Overseas Investment Office does not consider the potential for job losses, or rural depopulation, when considering purchases of farm land for conversion to forestry. But she disputed a claim by National MP Alastair Scott that the act was encouraging mass planting of farm land.
In Wairoa, of the seven applications the OIO handled, only three had been for land conversions, with the others being sales of existing forests, she said.
“I don’t think we’ve seen any evidence that suggests there is going to be mass afforestation across all of New Zealand,” Sage said. “There is more work being done by OIO to actually get a good handle on what is actually happening.”
Scott said the new pathway had lowered the bar for foreign ownership of land, relative to purchases for things like kiwifruit or vineyard development. “Not only is there no positive benefit needed to be demonstrated, but we know there are negative consequences that your office does not consider.”
Sage indicated the performance of the new forestry pathway was likely to be considered in the next phase of a review of the Overseas Investment Act being undertaken by Treasury. But she disputed that there were no benefits from accelerating planting.
“New Zealand has a strong wood processing industry that can be strengthened. We are good at growing trees. That does provide jobs in manufacturing and it’s a critical part of meeting our Paris commitments.”
New Zealand already has about 1.7 million hectares of plantation forest. So far, the government has contracted the planting of a further 13,400 ha – about 11.6 million trees. The government’s billion-tree target provides for two-thirds of that to be met through more expensive planting of slower-growing native trees.
Sage emphasised that planting natives as a permanent carbon sink would be ideal on erosion-prone land. National MP Ian McKelvie said the national environmental standard for forestry is actually encouraging planting on good land.
“If you have to get consent on highly erosion-prone land, it’s not going to get planted,” he said. “If there’s a disincentive to plant our most erosion-prone land, then surely we’ve got to do something about it? I’m on your side here, but what do we do with it?”
Sage said the higher grant sums available from the government for native planting may help overcome that. Asked if that should be included in the review of the OIA’s forestry provisions, she said the issue would be better addressed in a review of the plantation forestry standard that is currently underway.
Tarpeena sawmill upgrade underwayTimberlink continues to significantly invest into its Tarpeena sawmill as it transforms into an internationally competitive radiata pine business. The company is investing AU$90 million over the next 3 years to secure local jobs in the region for the next generation, this is in addition to the significant spend that has already taken place at the mill since Timberlink’s takeover in 2013.
Key to the early stages of the project is the construction of a new electrical substation for the town of Tarpeena. This is expected to improve the reliability of electricity supply for the township with all new hardware, modern design features and more reliable components.
The mill upgrade, to be completed in 2021, will increase both the volume of renewable plantation pine logs that can be processed and the yield per log. This will transform the mill into a workplace of the future, with high tech machinery improving accuracy, safety and job security. Timberlink is committed to training and upskilling our staff to run the new machinery and there will be no job losses as a result of the upgrade.
Around 20% of Australia’s softwood timber is imported, and to ensure Timberlink remains internationally competitive, the business is expanding and investing in new technologies to improve efficiency and create more structural timber for the domestic market. The investment includes a completely new saw line, the installation of a new stacker and edger, coupled with addition of a contraflow kiln and a new batch kiln for drying timber. A new drying shed will also be built as part of the project.
The Timberlink Tarpeena mill supports 680 direct and indirect jobs in the area whilst contributing over AU$180m to the local economy. This generational investment will create 200 jobs in the construction phase and secure the 210 permanent full-time jobs at the mill for the next generation. The AU$90m Tarpeena upgrade project will source the best technology from around Australia and the globe to ensure that Timberlink remains an essential supplier to the construction industry in Australia, whilst securing jobs and futures for many families in the Mt Gambier region.
ABARES snap shot of Australian wood processingThe Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) released the ABARES National Wood Processing Survey: 2016–17 report on Thursday 13 June 2019. Although maybe already out of date (it does though provide broad trends over a ten-year period), key findings from the survey include;
- ABARES estimates that a total of 299 mills (excluding value-add only) operated in 2016–17, comprising 182 hardwood sawmills, 58 softwood sawmills, 23 wood-based panel mills, 19 post and pole mills and 17 cypress pine sawmills.
- The number of sawmills in Australia has decreased significantly since 2006–07, with hardwood sawmills decreasing by 64 per cent and softwood and cypress pine sawmills by 31 per cent. The volume of hardwood and softwood sawlogs harvested for domestic processing has also decreased by 38 per cent and 2 per cent, respectively, over the same period. However, the decline in mill numbers has slowed since 2012–13 and total sawlog processing volumes have increased.
- In 2016–17, a total of 10.63 million cubic metres of sawlogs was processed in Australian sawmills, which comprised 1.91 million cubic metres of hardwood sawlogs, 8.58 million cubic metres of softwood sawlogs and 147,000 cubic metres of cypress pine sawlogs.
- A total of 4.71 million cubic metres of sawnwood was produced in 2016–17, comprising 742,000 cubic metres of hardwood sawnwood, 3.91 million cubic metres of softwood sawnwood and 57,000 cubic metres of cypress pine sawnwood. In 2016–17 an estimated 280,000 cubic metres of posts and poles and 1.79 million cubic metres of wood-based panels was produced.
- An estimated AU$2.48 billion of revenue was generated in 2016–17 from the sale of sawnwood processed in Australia, comprising AU$930 million from hardwood sawnwood sales and AU$1.55 billion from softwood sawnwood sales.
- ABARES estimates that Australia’s sawmills and post and pole mills employed 8,029 people in 2016–17, of which around 89 per cent were full-time workers (including managers and owners). Males accounted for around 90 per cent of the workforce. Wood-based panel mills employed a total of 2,390 people in 2016–17.
Climate change and the rural way of lifeThe New Zealand government’s environmental policy is creating major tensions in farming communities. Alex Braae went to a meeting in Taumarunui to see it play out.
“We’ve got to get the government’s attention somehow. Okay, we’re not all going to jump on our tractors and drive to Wellington. But we could jump on our tractors and block all the roads for a day and a half, just to get them to listen.”
The comment came from the floor, at a public meeting on carbon farming being held at the Taumarunui Golf Club. It was a rainy day, which meant farmers had some free time. The room was packed and fearful. In question was the future of their town, their district and their way of life.
A while ago, some farmers started talking about the ‘triple bottom line’ – economic, environmental and social. They started assessing themselves on not only how much money could be brought in, but how the farm contributed to the wider community and ecosystem. It’s a concept borrowed from the world of corporate sustainability, and has parallels in the long-term view of what farming should be about. Obviously, the performance of the farming world has been mixed on all three, particularly the environmental bottom line, but the mindset is changing.
But a new trend threatens to upend it completely. Recent months have seen a rapid rise in farms being sold to people who intend to turn the land over to carbon farming – in less technical terms, growing trees for carbon credits. Many of the purchases are made through the Overseas Investment Act.
It has led to the emergence of a group calling themselves 50 Shades of Green who have been touring rural service towns with dire warnings of the social and economic dislocation that would come with an end to food farming. After the morning meeting in Taumarunui, spokesperson Mike Butterick and his group were heading down country to Mangaweka, with some National MPs in tow.
The group originated in Wairarapa, where the process of land conversions to forestry is already well underway. Huge hillsides that once grazed animals are now being planted with trees, and with that change comes fewer jobs. Statistics provided by the group suggest for every 1000 hectares of farming, seven jobs are created compared to one for forestry.
The story on everyone’s lips is of the school in Kumeroa, across the Manawatū River from Woodville, which has lost its teacher. Her husband was a shepherd on a farm now being used for trees. The nightmare scenario for 50 Shades of Green is a depopulated rural world, with nothing but pinus radiata stretching as far as the eye can see, all of it covering land of the sorts of grades that are perfect for animals.
Photo: A social media image put out by 50 Shades of Green
Trees aren't taking over rural communitiesForeign buyers are not investing "dollops of dough" into forests and displacing rural communities, Forestry Minister Shane Jones says. However, he acknowledged there was a perception the Billion Tree Programme was threatening the viability of rural New Zealand.
Ginger group 50 Shades of Green has sounded the alarm over a hike in the numbers of farms in Wairoa and Wairarapa being sold to foreign investors. Jones said he was preparing to meet up with the group to allay its fears.
Government incentives to plant trees have seen the median price of forestry farms rise by 45 per cent over the last year from $6487 to $9394 per hectare. Of eight farms near Wairoa which had recently been sold, only two of them should not have gone into forestry and would have been better remaining as dry stock farms, Forestry Ministry officials have said.
On Tuesday Jones, Agriculture Minister Damien O'Connor and Deputy director of Forestry New Zealand Te Uru Rakau Julie Collins fronted media with an update on the programme.
Last year the tree planting target was 55 million, but 65 million were actually planted. This year it is expected to rise to 80 million, leading up to 100 million by 2021.
Jones and O'Connor said the programme was aimed at farmers, with a target of two-thirds natives and the remainder plantation. Farmers could tap into NZ$240 million in grants but there had not been a big uptake. "I've been puzzled over why they have been so slow to come forward. These are grants, not loans, and there's another NZ$117m for partnership schemes," Jones said.
Asked if there was a danger of land speculation if the price of carbon rose, O'Connor conceded it was a possibility that Climate Change Minister James Shaw was watching closely. He said he was working on adjustments to the Emissions Trading Scheme which might allow farmers to claim carbon credits for plantings such as shelter belts and riparian strips. Farmers "who have planted in good faith and for good reasons" might be able to aggregate their plantings.
The ministers said during the last decade more land had been converted from forestry to farming - about 7000 ha a year - including in unsuitable areas such as Wairakei Estates north of Taupo. That trend was now in reverse, with 9100 ha of new planting last year.
Collins said her ministry was using its discretion over who qualified for grants, which were up to NZ$2000 per ha for pines and NZ$4000 for native forest. "We have turned down people who have bought land and wanted to convert it all into trees, we've been clear the grant scheme isn't there to support whole farm conversions," she said. So far 54 planting grants worth NZ$4.4m have been approved, over two-thirds of which are under 50 ha. Recently questions had been raised over whether foreign investors can access the grants, but Collins said they could not if they bought to convert a whole farm.
Jones cautioned lobby groups who he said sided with the National Party. "I'm going to treat anyone who is travelling with the National Party as partisan foes, not as potential fellow travelers or partners."
Fifty Shades of Green spokesman Andy Scott said his organisation was bipartisan. "We're meeting with Labour and NZ First as well, and will be seeing them shortly. We pride ourselves on being as neutral as we possibly can." He said it was encouraging to hear that farmers might more readily be able to claim carbon credits off their plantings.
Composite deck producer increases capacityTrex is expanding production of its composite deck products in Virginia and Nevada. Winchester, Va.-based Trex Co. Inc. plans to invest US$200 million in the next two years to increase capacity by 70 percent, with a new plant at its headquarters site and more production lines at its plant in Fernley, Nev.
The world's largest decking and railing producer expects to add capacity in Fernley at the beginning of the third quarter of 2019 and then again by the second quarter of 2020. The new plant should be operating in the first quarter of 2021.
The investment will allow Trex, which is a major recycler of post-consumer film and bags, to increase output of its composite decking, which competes with wood, according to a June 6 news release.
"Demand trends indicate the conversion from wood has accelerated at a faster pace than expected with our recent introduction of the Enhance decking products," Trex CEO James Cline said in the release. "This has required that we accelerate our planned capacity expansion by one year."
Trex unveiled its Enhance Basic decking with a scalloped profile at the International Builders' Show in February. The company told builders it engineered cost out of the equation for homeowners wanting to upgrade from pressure-treated wood decking to low-maintenance composite decking made from recycled polyethylene and reclaimed wood fibre.
Trex then encountered some start-up problems in Winchester and equipment failures in Fernley. The company ended up modifying the decking profile so it would have less-pronounced scallops on the underside to improve throughput.
Production rates at both the Virginia and Nevada facilities have reached planned levels while the other operating improvements are underway, the release says. The revised capital expenditure program was announced along with investment guidance that Trex would increase spending related to buildings and equipment from US$75 million to US$80 million in 2019. The investments will be funded by operating cash flows.
With annual sales of US$565.2 million, Trex is the sixth largest pipe, profile and tubing extruder in North America, according to Plastics News data.
New Zealand's primary sector boomingThe latest study of New Zealand's primary sector shows booming exports for the second year in a row. The SOPI report (Situation Outlook for Primary Industries) shows total farm, fishing and forestry exports for the year to the end of this month forecast to rise to NZ$45.7 billion.
That is a 7.1 percent rise for the year, and the it's accelerating: the June forecast is up by NZ$100m on the forecast for the one three months before. The SOPI report is prepared by the Ministry for Primary Industries.
Dairy export revenue is forecast to increase 5.7 percent to $17.6 billion supported by strong milk production and sustained global demand. Meat and wool export revenues are forecast to reach NZ$10.2bn up 6.4 percent from the previous year due mainly to strong red meat prices which more than offset low prices for coarse wool.
Horticulture revenue is forecast to have the strongest growth, by 13.7 percent for the year to NZ$6.1bn. Kiwifruit, wine, and apples and pears got the credit. Seafood export revenue is forecast to rise 7.3 percent to NZ$1.9bn.
The only negative spot was held by the arable industry, whose earnings are forecast to fall 4 percent, to NZ$235m, due to poor quality and lower yields in the 2018 harvest.
Forestry revenue is forecast to reach NZ$6.9 billion, an increase of 7.8 percent since 2018, driven by increased Chinese demand for New Zealand logs.
Celebrating South Australia industry successAfter the outstanding success of the inaugural Green Triangle Timber Industry Awards last year, the committee are pleased to announce the call for nominations is now open again for the 2019 awards campaign. Over the next 8 weeks they are encouraging the forest industry to put forward those within the sector who show outstanding qualities, are significant mentors and are committed to the role they play.
Industry sponsors from last year have returned which is a sound indication that the industry is keen to roll the event out for a second year and applaud its skilled workforce and business champions. More than 500 people were on hand last year to celebrate as Reid Logging picked up the top award, along with the prize for harvesting excellence, with employee Adam Sealey taking out the individual forest operations crown.
This multi-generational logging company was toasted as the supreme winner of the inaugural Green Triangle Timber Industry Awards at The Barn in Mount Gambier. Another outstanding commendation was Leonie Stapleton from Timberlink who was honored with a lifetime contribution award, recognising her long-term commitment and involvement in an industry that has historically been male dominated.
Leonie was seen as quite unique, in terms of her contribution and legacy. She played a consistent and important role in the development of the regions export woodchip trade, the radical disruptor of the 1980’s and 1990’s. The export woodchip trade is the market that accelerated the regions thinning programs, creating the forest structure that generates todays reliable and uniform supply of larger high-quality saw log. It was the enabler for much of the timber manufacturing activity we see in Mount Gambier today.
This year the committee also announce a new award, the Services to the Timber Industry award which recognises excellence in businesses that offer services to the timber industry. This includes but is not limited to, training organisations, IT services, equipment suppliers, agencies and suppliers.
The nominees and winners will be celebrated at a formal dinner held at The Barn, Mount Gambier, Friday 1 November with a guest list expected to easily meet capacity of five hundred, with comedian and radio and tv entertainer Merrick Watts as the master of ceremonies.
“We were very proud of the efforts of our industry last year to get this event up and going and to have support from our sponsors who serve our forestry industry across the Green Triangle Region so enthusiastic to be part of the campaign. We know there will be an even greater energy and support for nominations this year now that this sector has seen how the event can provide a platform for celebration,” applauds Adrian Flowers, Chair of GTTIA Committee.
The nomination process starts with an online form with an efficient step by step process to complete across a number of categories. By majority the categories themselves have remained the same with a few name changes to clarify some sectors of the industry that could have been missed out last year. Nominations will close on August 16 and then judging will begin.
For more information visit the website www.gttia.com
Electronic tags for prefabricated timberThe advantages of prefabricated timber systems in construction are being given a boost by researchers trialling Radio-Frequency Identification (RFID) tracking technology to improve on-site processes.
The latest podcast episode of WoodChat focuses on research funded by Forest and Wood Products Australia (FWPA), which has been testing the value proposition associated with attaching small, computerised tags to timber construction elements manufactured off-site.
By utilising tags on cross laminated timber (CLT) panels, wall frames and flooring systems, real-time data about each component can be easily stored and accessed. Such information might include details of properties, records of repair and maintenance, inspection history and treatments, as well as where the component currently sits in the construction process, and what needs to happen to it next.
Electronic readers can then be used by construction teams to unlock all the information stored, allowing for easy identification and tracking. Perry Forsythe, Professor of Construction Management at the University of Technology Sydney, who is leading the research, told WoodChat that the project came about due to the industry’s desire to seek methods of improving the ways prefabrication and timber are used in construction.
“There is a desire in Australia and worldwide to position timber as a viable solution, not just for one or two storey buildings, but for much larger structures. One of the major points of difference is timber components can be prefabricated off-site, which brings a whole host of advantages.
“RFID technology can be used to add to the existing advantages of prefabricated timber, by enabling improved productivity. Having immediate information available about each component speeds up on-site processes and improves workflow, ultimately saving time and money.
“There are also advantages around quality assurance, both now and into the future, far beyond construction. As component information can be stored for the lifespan of the building, the eventual owner has complete transparency and visibility. This knowledge will help them manage the ongoing maintenance of their building,” Professor Forsythe said.
The research team has conducted thorough consultation with representatives from across the supply chain, explored the different types of technologies available in the space, and has undergone rigorous field-testing scenarios with industry partners, leading to encouraging results.
This episode is part of the second series of the WoodChat podcast, following topics on how emerging Australian leaders have been supported to discover the latest in global timber advancements and how 3D printing can turn timber waste into construction materials.
WoodChat represents FWPA’s commitment to exploring engaging new ways of communicating industry news and innovations. Each episode includes in-depth conversations with experts on recent discoveries, innovations and initiatives.
You can listen to WoodChat on SoundCloud and iTunes.
First dowel-laminated timber building in the U.S.A four-story mixed-use structure in Des Moines, Iowa, will be the first building in the U.S. to be constructed with dowel-laminated timber, an all-wood mass timber product that is held together without nails, glue, or fasteners and can be assembled with friction-fit wood connectors.
Designed by Neumann Monson Architects, the 65,000-square-foot building, which houses shops, restaurants, and offices, is made from pre-fabricated 8’x20′ DowelLam panels by StructureCraft, along with spruce glulam beams and columns, and precast concrete. DowelLam can reportedly be created in an array of custom profiles and is easily handled by CNC equipment.
The architects reported that working with the easy-fit prefab panels allowed for faster construction with fewer workers. Not just structural elements, the panels will also remain exposed on the building in order to contribute to its overall aesthetic. In addition, the architects estimated that the timber construction “sequestered” around 280 tons of carbon and doesn’t run the risk of “off-gassing” chemicals like other glue-based mass timber products like CLT.
StructureCraft reported other projects in North America are also putting the dowel-laminated product to use, including the Lake|Flato–designed Center for Conservation at the Museum of Fine Arts, Houston and a regional airport in British Columbia.
Vancouver wood building would be world’s tallestIf plans are hammered into reality, Vancouver’s Broadway corridor will see the world’s tallest wood residential tower and the largest Passive House project in the world ascend on West 8th Avenue over the next two to three years.
Delta Land Development, working with Peter Busby of the architectural firm of Perkins+Will, has outlined a proposal for a mixed-use building that, if approved, would catapult Vancouver’s aggressive green building standards ahead by nearly a decade.
British Columbia recently approved mass timber buildings as high as 12 storeys, but Delta’s senior vice-president believes the Canada Earth Tower could win approval to push much higher.
“There are no major roadblocks to going higher than 12 storeys,” said Kirk Robinson, who added that the City of Vancouver appears on board with the proposal, “subject to a whole bunch of reviews.” He said the building would stand 30 to 40 storeys high at 1745 West Broadway, currently the site of a bunker-like bank processing facility.
The tower would use B.C. manufactured and processed mass timber, as well as engineered wood such as cross-laminated, glue-laminated and dowel-laminated timber. It would be designed for maximum fire and structural safety, architects say, while lowering greenhouse gas emissions.
Reinforced concrete would still be required for the elevator cores, stairway silos and foundation of the proposed tower, said Derek Newby, an associate architect at Perkins+Will. Because of the carbon sequestered in mass timber, Robinson said, the Canada Earth Tower could easily meet the City of Vancouver’s plan for all new buildings to be low carbon producers by 2030.
On April 16, the city released a “climate emergency response” proposal that calls for new buildings to reduce carbon emissions by 40% from 2018 levels by 2030 and “remove regulatory barriers to mass timber construction.” Vancouver is considered a world leader in tall wood buildings. The 18-storey Brock Commons tower at UBC was the tallest wood building in the world when it was completed in 2017.
Photo: Canada Earth Tower: world’s tallest wood tower planned for Vancouver would also include rigorous green technology, Perkins+Will
Wood pellet shipments up 21 percentGlobal trade of wood pellets jumped more than 21% year-over-year in 2018 when a new record of 22.3 million tons was shipped, according to the North American Wood Fiber Review. The five major pellet exporting countries (the US, Canada, Vietnam, Latvia, and Russia) have remained the top exporters for over five years. They accounted for about 69% of the world’s export volume in 2018.
Following the “big five” in 2018 were Estonia, Austria, Malaysia, Denmark and Germany, in descending order. Pellet production in the US South continued at record pace in, driven by a European move away from fossil fuels and towards renewable energy. From the 1Q/18 to the 4Q/18, exports from the region were up almost 50%, further manifesting US’s role as the world’s largest producer and exporter of wood pellets, reports the NAWFR. The United States ships practically all its pellets to three countries: the United Kingdom, Belgium and Denmark. Only a small share of the pellet production in the US is consumed domestically.
Demand for imported pellets in Japan and South Korea continued a three-year growth trend in the 4Q/18 when import volumes reached new record highs of 339,000 tons and 993,000 tons, respectively. In 2018, the total annual import volume for the two countries was just over 4.5 million tons, more than doubling in just two years. With the increased trade, prices for pellets landed in both Japan and South Korea have moved upward over the past three years.
In the 4Q/18, the price for pellets imported to Japan averaged $182/ton, up almost six percent from the 4Q/17. Pellet import prices to South Korea, which were nominally lower than those in Japan, rose almost 25 percent during the same period. The lower average cost for South Korea can be explained by that country’s reliance on pellets from low-cost countries in nearby Vietnam and Malaysia. This is unlike Japan, whose major pellet supplier is British Columbia, a more expensive producer of high-quality FSC and SFI certified pellets.
Source: Wood Resources International LLC, www.WoodPrices.com
Buy and Sell
... and one to end the week on ... good news bad news
Dad and Dave and old Bert have come forward to the modern day but they’re still the same characters they always were.
And on that note, enjoy your weekend and we look forward to seeing many of you next week in Rotorua for the major two-yearly catch-up of wood harvesting contractors and forest managers from across the region. See you there. Cheers.
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