China softwood log inventory has remained stable at about 5.0M. Daily port log offtake has dropped to around 60 - 65K a day. The CFR price for A grade logs still ranges between 145 and 150 USD per m3.The June Caixin China Manufacturing PMI increased to 51.7. (An index above 50 signals market growth). This rate of growth is the quickest since November 2020. Companies were generally upbeat in their forecasts as they anticipated increases in both production and demand. However, they expressed concern over any potential negative impact of future Covid-19 outbreaks and the state of the global economy.<\/p>\n
China is suffering from extreme weather this summer with severe flooding accompanied by intense heatwaves. More than 900 million people in China (65% of the population) are living under some type of heat warning. We are used to log demand reducing at this time of the year, so the quiet activity is not too unusual, especially given the extreme weather. A prolonged surge in power demand could lead to local governments preparing \u2018orderly consumption\u2019 plans to curb supply to inefficient or high consumption factories. This is to allow residents to continue using air conditioning units.<\/p>\n
New Zealand log supply to China will reduce for August. Most crews are on production quotas, and this is compounded by the weather conditions. Most ports in New Zealand are quiet.<\/p>\n
Many exporters were scrambling to get enough volume to fill log vessels. By the end of May 2022 China had imported approximately 7.8m m3 less of logs than the same five-month period in 2021. This is about a 40% drop in supply (and demand to match). The biggest reductions were from Europe (down 3.1m m3), Russia (down 1.5m m3), NZ (down 1.45m m3), South America (down 967k m3), and the USA (down 444k m3)<\/p>","protected":false},"excerpt":{"rendered":"
China softwood log inventory has remained stable at about 5.0M. Daily port log offtake has dropped to around 60 – 65K a day. The CFR price for A grade logs still ranges between 145 and 150 USD per m3.The June … Continue reading