China drives booming export of New Zealand logs

14:40, July 12, 2011      

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The value of New Zealand forestry exports in the first three months of this year leapt by 800 million NZ dollars (655.76 million U.S. dollars) to 4.4 billion NZ dollars, fueled by soaring demand for logs from China, New Zealand's Ministry of Agriculture and Forestry (MAF) announced Tuesday.

New Zealand's log exports continued to be dominated by exports to China, said MAF acting manager of sector infrastructure Andrew Doube.

This was driven by strong economic growth in China and a reduction in the availability of logs from Russia, China's traditional supplier, said Doube.

China imported 1.7 million cubic meters of New Zealand logs in the March quarter, up by 44.5 percent from the same period last year.

India was also emerging as a significant importer of New Zealand logs, with demand approaching that of South Korea, New Zealand's second largest log export market.

The volume exported to India in the March quarter was 400,000 cubic meters, up by 157 percent year on year.

Exports of 3.1 million cubic meters of logs in the quarter accounted for half of New Zealand's estimated harvest.

"This is the first time this has happened in the 25 years these statistics have been collected," said Doube.

The strong international demand for logs has resulted in higher domestic prices, putting pressure on New Zealand wood processors, who were facing less demand from reduced construction activity at home and in the United States due to the global economic recession.

"As a result, some mills have closed or down-scaled since the December 2010 quarter, and some remaining saw-millers have reported to MAF that they are questioning their future viability in the industry," said Doube.

The earthquake that struck Christchurch on Feb. 22 had no immediate effect on total sawn timber production figures through the first quarter of the year.

"There is a general expectation that there will be increased demand for processed wood products once the post-quake rebuild begins."

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