Statistics released yesterday by the Ministry of Agriculture and Forestry showed log exports continued to be dominated by exports to China. This was reflected in annual log exports from Port Chalmers, which were up more than 200%, to almost 700,000cu m, during the past financial year.
Exports to China had been driven by its strong economic growth and a reduction in availability of logs from Russia, China's traditional supplier, Maf's sector infrastructure acting manager Andrew Doube said.
However, the strong international demand had also resulted in higher domestic prices, putting pressure on New Zealand wood processors, who were also facing less demand from reduced construction activity both domestically and in the United States, due to the global economic recession.
Some mills had closed or down-scaled since the December 2010 quarter, and some sawmillers still operating were questioning their future viability in the industry, he said.
China imported 1.7 million cu m of New Zealand logs in the March quarter, up 44.5% on the same time the previous year.
About 695,000cu m of logs were exported across Port Otago's wharves for the year ending June 30, chief executive Geoff Plunket said yesterday.
Almost 200,000cu m went through the wharves for the six months to December 2009, which compared with 240,000cu m for the entire previous year, and 200,000cu m the year before that.
Mr Doube said India was also emerging as a significant destination, with its demand now approaching that of Korea - New Zealand's second-largest log export market.
The volume exported to India in the March quarter was 0.4 million cu m, up 157% on the same time the previous year.
Overall, the export of 3.1 million cu m of logs in the quarter accounted for half the estimated harvest. It was the first time that had happened in the 25 years the statistics had been collected, Mr Doube said.
Forestry had been "in the doldrums" for most of the last decade but, during the past 18 months, a combination of carbon sales and higher log prices had really lifted the industry, City Forests chief executive Grant Dodson, who is also chairman of the Southern Wood Council, said.
City Forests reached its sustainable harvest level this year and was exporting about 14,000cu m of logs per month from Port Otago. It exported almost exclusively to South Korea, as it had done for many years.
There had been a particularly favourable period for exporting logs, although prices had just "stacked" in the last two weeks, Mr Dodson said.
Looking at last year's statistics, there was also a dip around winter time and that same dip was now being experienced, driven by some seasonal factors.
However, the dip being entered now could be a little deeper and longer because the Chinese were actively restricting their economy.
The February 22 earthquake in Christchurch had no immediate effect on total sawn timber production figures through the first quarter of the year.
A building boom in the city in 2012-13 would "soak up a lot of timber" which would be good for domestic mills, Mr Dodson said..
Forestry
• Forestry directly accounted for $180 million to $200 million in Otago-Southland annual exports in past decade (2000-10).
• The combined export total for logs, sawn timber and woodchips in the December 2010 year was $182.4 million.
• The combined Otago-Southland region has 208,000ha of forest (as at April 2010).
• $62 million of sawn timber (181,500cu m) exported through Bluff and Port Chalmers in 2010.
• $97.2 million of logs (847,000cu m) exported through Bluff and Port Chalmers in 2010 (free on board). In 2009, 464,000cu m exported.
Source: Southern Wood Council
