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China softwood log inventory has dropped to about 3m m3\u00a0with radiata pine from New Zealand accounting for about 2.75 m3. Port off-take has remained steady ranging round 70k per day. Usually construction activity drops 10-15% in the hotter months of June to August. Most commentators think we won\u2019t see such a significant drop this year<\/span>, as construction is already at a lower yet consistent level. There is also low inventory through the supply chain, so daily port offtake won't drop at the same rate as productivity.<\/p>\n The CFR price for A grade radiata pine logs in China has dropped to 108-115 USD per JASm3.<\/p>\n China also has increased supply from domestic harvesting of Masson pine in southern and central China and Poplar in Northern China. These sell for an average price of 800 RMB per m3\u00a0which equates to 113 USD. The 2020 ban on sending Australian logs and timber to has now been lifted. This was a political spat thinly disguised by China as a quarantine risk. Log buyers in China don\u2019t expect much log volume from Australian suppliers, and especially at current pricing levels. In many cases infrastructure needs to be reinstated and this cost isn\u2019t justified at the current pricing level.<\/p>\n The biggest issue for log buyers and construction companies in China remains cashflow constraints. The construction sector in China has the longest average payment delay of any sector in China with an average of 96 days.<\/p>\n The China Caixin manufacturing PMI dropped to 49.5 in April. This was the first contraction in factory activity since January. The optimism earlier in the year seems to have reduced with the property market not increasing activity as forecast and fears of a global slowdown.<\/p>\n Source: PF Olsen<\/em><\/p>","protected":false},"excerpt":{"rendered":" China softwood log inventory has dropped to about 3m m3\u00a0with radiata pine from New Zealand accounting for about 2.75 m3. Port off-take has remained steady ranging round 70k per day. Usually construction activity drops 10-15% in the hotter months of … Continue reading