New Zealand sawmillers are being strangled by continuing log shortages.
High export demand for logs in China and other Asian markets is creating a widespread shortage of logs for processing here says the New Zealand Timber Industry Federation, and there’s every reason to believe these shortages will continue over the next few years.
Since 2008 New Zealand log exports have increased by 240% and international forestry commentators are saying that the level of demand for logs in China (which accounts for 70% of our log trade) will continue for the foreseeable future.
More than twice the number of New Zealand logs is exported than are processed domestically.
This shortage of logs is a major concern to members says the New Zealand Timber Industry Federation. Many of them frequently experience downtime and production losses because they are unable to buy logs or log supply is stopped.
New Zealand sawmills are often paying top international rates for logs, so price is not an issue. It simply appears that some forest owners value their international customers more highly than domestic processors.
Opposition political parties have already raised concerns about the 3000 job losses estimated in the New Zealand wood processing sector since 2008. If this unsatisfactory situation with log supply continues there could be more closures and further industry rationalisation.
This could lead to a shortage of product for the domestic market requiring timber to be imported into New Zealand.
We believe there has to be a serious discussion at government level about the on-going situation with log supply to the domestic wood processing industry said the New Zealand Timber Industry Federation.