Continuing the focus on Australia’s softwood industry, exports of softwood logs have continued to rise, hitting new records on a regular basis.
To the year-ended November 2014, softwood log exports totaled Xm3, up from Ym3 for the year-end November 2013.
The new export record has been set in the context of an increasing harvest to meet the growth in domestic housing. However, its worth noting that given a relatively stable softwood estate of 1 million hectares the increased production of softwood logs would suggest greater recoveries or improved merchandising are being achieved by Australian growers.
Anecdotally, it is understood that thinning regimes have been improved or at least become more prevalent in recent years resulting in more smaller end diameter (SED) logs being available for export.
The chart below shows exports of coniferous logs for year-end November since 2000. Total log exports are overlaid.
Softwood log exports have grown sharply while softwood chip exports have remained stable. This has led some to speculate that with hardwood chip exports strong and ports bottlenecked in some cases, the only means of exporting smaller quantities of softwood is in log form. That proposition may hold true, in certain regions.
The volumes are one part of the export equation for softwood logs. The other is value and pricing. For the year-end November 2014, the total value of softwood log exports was AUD281.0 million, up from AUD165.2 million just one year earlier. This data is displayed in the following chart extracted from the FWPA Data Dashboard.
Fig 10
To go straight to the dashboard and take a closer look at the data, click here.
Overall and regardless of the domestic supply lines, there is at least one thing that is clear. Australia’s softwood resources, in whatever form they are available, are increasingly valuable. Asia is starved of softwood, for all purposes, including those such as paper making that require long, strong fibres supplied by coniferous species.
Evidence of this can be seen in the following chart, which shows the destination of all of Australia’s softwood logs. The dominance of China and the relevance of Korea are the points to note.
Fig 11
To go straight to the dashboard and take a closer look at the data, click here.
For the year-end November 2014, Australia’s softwood log exports to China were worth almost AUD250 million. By any measure, that is a significant trade line.
