Forestry production and trade for the September 2006 quarter1

Overview

For the second consecutive quarter roundwood removals, an indicator of export and domestic processing levels, increased. This was despite the New Zealand dollar strengthening slightly during the September 2006 quarter, up 1.2 percent on the previous quarter (Reserve Bank�s Trade Weighted Index, RBNZ website). Higher domestic and export log prices for all grades except pruned logs helped drive harvest levels up. However, the continued fall in prices for domestic and export pruned logs remains a concern for parts of the sector.

Production

The main changes between the June 2006 quarter and the September 2006 quarter were an increase in roundwood removals, increases in sawn timber and veneer production, and a fall in paper and paperboard production.

Roundwood

September 2006 quarter roundwood removals were up 6.1 percent, to 5 185 000 cubic metres, on the June 2006 quarter, and at similar levels to the September 2005 quarter. The biggest contributor to this increase was the volume of saw logs and peeler logs used in domestic production, up 10.6 percent. These figures suggest that improved market conditions are beginning to impact on the amount of domestic processing.

Sawn timber

Production of sawn timber in the September 2006 quarter was up 9.3 percent on the June 2006 quarter, to 1 168 000 cubic metres. Production is usually higher in the September quarter than in the June quarter, as building activity picks up before Christmas and better weather increases the availability of logs. Production in the September 2006 quarter was very similar to the September 2005 quarter, up only 1.1 percent.

The September 2006 year end figure was down 2.9 percent on the September 2005 year end figure. The slow down in production over the September 2006 year was due to a strong New Zealand dollar. Although the dollar fell in early 2006, a number of mills had closed or scaled back production in the previous 12 months because of poor returns. The New Zealand dollar strengthened over the September quarter and has continued to strengthen since.

Veneer

The volume of veneer produced in the September 2006 quarter was up 19.6 percent on production in the June 2006 quarter and up 10.4 percent on the September 2005 quarter. At the end of 2005 one mill suspended production because of unfavourable market conditions. This mill resumed production during the September 2006 quarter, although at a lower level than in 2005.

Paper and paperboard

Production of paper and paperboard in the September 2006 quarter fell 13.3 percent from the June 2006 quarter volume, to 202 000 tonnes. This was a decrease of 12.3 percent on the September 2005 quarter. Production during the year was lowered by planned maintenance during the quarter at two sites and the decommission of a paper machine at the end of July.

Table 1: Production volumes

  September
2006 quarter

(000)
Change from
June
2006quarter

(%)
Change from
September
2005 quarter

(%)
September
2006 year

(000)
Change from
September
2005 year

(%)
Roundwood (m3) 5 185 6.1 2.3 19 043 -0.5
Sawn timber (m3) 1 168 9.3 1.1 200 -2.9
Wood pulp (t) 376 -0.9 -5.7 1 528 -4.4
Paper and paperboard (t) 202 -13.3 -12.3 908 -3.9
Fibreboard (m3) 235 -0.8 0.2 918 8.0
Veneer (m3) 199 19.6 10.4 669 -4.6
Plywood (m3) 114 12.1 4.9 397 -4.2
Particleboard (m3) 66 13.1 1.3 236 -3.0

Exports2

Due to improved market conditions, the volume and value of forestry products exported in the September 2006 quarter exceeded exports during the June 2006 quarter for all products for which data are available. The most significant increases were in exports of logs and poles, sawn timber and wood pulp.
Compared to the September 2005 quarter, September 2006 quarter exports volumes and values were up for most products, except for plywood and particleboard.

Logs and poles

The volume of logs and poles exported during the September 2006 quarter increased 4.5 percent, to 1.5 million cubic metres, restoring export volumes to levels last seen in the March 2005 quarter. The value of the logs and poles exported in the September 2006 quarter was NZ$151 million, up 6.7 percent on the June 2006 quarter and 26.7 percent on the September 2005 quarter.

Export volumes for logs and poles to New Zealand�s three main markets (Korea, China and Japan) increased in the September 2006 quarter. Volumes to India, our fourth largest market, fell, but exports to the United Arab Emirates rose.

Export volumes of logs and poles for the year ended September 2006 increased 5.6 percent compared with the year ended September 2005. Over the same period values increased 24.3 percent. These figures are a result of improved New Zealand dollar log prices over the past year. The four quarter average log price for September 2006 was up NZ$6 on September 2005, its highest level since September 2003 (MAF log price series).

Sawn timber

Sawn timber export volumes in the September 2006 quarter were 550 000 cubic metres, a rise of 13.5 percent on June 2006 quarter exports and 14.4 percent on September 2005 quarter exports. Export values also rose 19.9 percent between the September 2006 quarter and the September 2005 quarter.

Wood pulp

The September 2006 quarter wood pulp export volumes were up 27.6 percent (to 209 000 tonnes) on June 2006 quarter volumes. The value of wood pulp exports also rose between the quarters, up 38.7 percent to NZ$160 million. The rise in export volumes was driven by chemical wood pulp exports, which rose 35.8 percent. Mechanical pulp export volumes remained unchanged from the June 2006 quarter, while mechanical pulp production decreased 4.7 percent.

Wood pulp export volumes for the September 2006 year decreased 8.0 percent compared with the September 2005 year. Export values rose 12.5 percent over the same period as international pulp prices improved.

Table 2: Quarterly export volumes

  September 2006
quarter

(000)
Change from
June 2006
quarter

(%)
Change from
September 2005
quarter

(%)
Logs and poles (m3) 1 489 4.5 8.7
Sawn timber (m3) 550 13.5 14.4
Wood pulp (t) 209 27.6 4.1
Fibreboard (m3) 203 10.5 17.3
Plywood (m3) 19 47.1 -23.4
Particleboard (m3) 26 2.2 -23.3

Table 3: Quarterly export values

  September 2006
quarter

(NZ$ 000)
Change from
June 2006
quarter

(%)
Change from
September 2005
quarter

(%)
Logs and poles (m3) 150 928 6.7 26.7
Sawn timber (m3) 230 639 9.0 19.9
Wood pulp (t) 160 347 38.7 48.8
Fibreboard (m3) 73 893 11.2 23.0
Plywood (m3) 30 146 27.0 -11.6
Particleboard (m3) 13 853 27.1 -23.3

Table 4: Annual exports

  Export volume Export value
September
2006year

(000)
Change from
September
2005 year

(%)
September
2006year

(NZ$ 000)
Change from
September
2005 year

(%)
Logs and poles (m3) 5 317 5.6 508 000 24.3
Sawn timber (m3) 1 904 5.1 784 114 5.0
Wood pulp 803 -8.0 525 449 12.5
Paper and paperboard 640 -4.1 538 591 0.3
Panel products (m3) 1 084 2.9 481 512 -12.2
Other forestry products - - 517 100 16.4
Total exports - - 3 354 766 6.4

Notes

  1. All production figures in this release are provisional; all September 2006 trade figures are provisional.

  2. Export values are NZ$ free on board (the value of goods at New Zealand ports before export, includes cost of transport to port).


Published by the Ministry of Agriculture and Forestry
Published 15 December 2006

Download accompanying tables as CVS Files

Contact for Enquiries

Monitoring and Evaluation
Innovation and Research Policy Directorate
Ministry of Agriculture and Forestry
Email: stats_info@maf.govt.nz
Phone: 64 4 894 0100

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