WoodWeek 19 January 2022
Next, get out your flash new 2022 diary as it’s time you marked in our Rotorua conferences for some long overdue meeting, greeting and networking:
ForestTECH Conference – 23 & 24 February
WoodWorks Conference – 1 & 2 March
It's BACK - Residues 2 Revenues Conference – 9 & 10 March
DigitalAg Conference – 30 & 31 March (formerly MobileTECH)
NEW! >> Environmental Forestry Conference - 10 & 11 May WoodTECH Conference – 18 & 19 May
Carbon Forestry Conference – 9 & 10 August
We hope you enjoy this week’s SnapSTAT. It shows how significant Maori-owned assets are across the primary industries. Thanks to our feature sponsors - Chainsaw & Outdoor Power and Oregon.
So, get into this week's content for your first WoodWeek for 2022. Our conference and communications team is back on the job and we’re keen to bring you the conference topics and wood news that matters most to you ... each and every week for another year! We look forward to your suggestions for content and your feedback on the issues of the week.
Finally, as always, any contributions of good (clean) jokes are welcomed.
This week we have for you:
Champion Freight - Log export market summaryThanks to our team at Champion Freight we have a graphic summary of the latest monthly update for export log markets. Champion Freight's latest report shows shipments to China month-on-month to end of November were down just 1 percent, while export sales varied for the month with India up (+41%), Japan up slightly (+5%) and South Korea down (-51%). Overall log export values were down by just 1 percent over November last year.
Log export values into China year-on-year (y-o-y) to the end of November were down up 40 percent. The trend was reversed for logs to India, down 57 percent y-o-y. Logs to South Korea, now our second largest log market (but only one-tenth of China), increased by 10 percent y-o- y to end of November.
PF Olsen - Log export market updatePF Olsen Market Summary - The At Wharf Gate (AWG) prices for export logs remained unchanged in December, although we did receive price increases in a couple of ports where exporters managed to secure favourable spot deals for shipping. The CFR sale price in China has bottomed at 130-135 USD per JASm3 for A grade.
Shipping congestion has cleared in China and the backlog of log vessels have been discharged without log inventory increasing. Reduced supply in December and January should lead to reduced inventory levels heading into the Chinese Lunar New Year at the start of February. However, log demand in 2022 is still uncertain.
The PF Olsen Log Price Index remained at $110 for December. The index is currently $12 below the two- year average, $13 below the three year-average and $14 below the five-year average.
Export Market - AWG Prices - While the AWG price range between exporters and ports remains varied there was some reduction in the range as exporters that had better shipping deals have seen those deals end and there is a more level playing field. A couple of exporters also managed to secure good spot deals on vessels which allowed them to increase AWG prices at certain ports. The drop in sales price in China was countered by the fall in freight costs and the NZD weakening against the USD.
China - The price for logs in China seems to have bottomed at 130-135 USD per JAS m3 for A grade logs. Softwood inventory levels have dropped slightly to 4.5m m3 and daily offtake remains steady at 75k per day. This inventory level is about 40% higher than normal for this time of the year.
There will be reduced log supply in December and into 2022 Q1 as:
• A recent survey of harvesting contractors indicated only about 35% were operating at normal capacity.
• Many harvesting crews will stopped three or more weeks over the holiday period.
• Germany’s harvest of bark beetle damaged wood is forecast to decrease from 60m m3 in 2021 to 43m m3 in 2022. Furthermore, increased domestic demand is expected to reduce export volumes to China.
Log demand usually reduces heading into the Chinese Lunar New Year, then increases rapidly until construction activity is at full production until the hot sticky weather arrives in China in June and July.
IndustryEdge brings new tricks to clientsThe latest upgrades to Wood Market Edge online put even more analytical tools in the hands of Australia and New Zealand’s forestry and wood products industry.
Client feedback since Wood Market Edge online was launched in April 2020 focussed on three main areas:
• Global log trade and the relationship between Australia and New Zealand
• Using the data and platform to assemble ‘headline’ forecasts of sawnwood demand
• Providing ‘port-to-port’ trade data analysis
Over 2021, the team at IndustryEdge in Australia and Forest2Market in the US have developed and tested new tools that address these industry needs.
Using simple navigation, subscribers can now access a headline sawn structural softwood demand forecast that is updated every month, for the coming twelve months. As below, the charts can be downloaded, along with the underlying data.
Subscribers can select new views showing them Australian, New Zealand and composite log price indexes, allowing for comparisons over time, providing insights to the moving global costs of softwood fibre. As we can see here, the trajectory of softwood log trade prices has been very different for Australia and New Zealand. No surprises, but powerful confirmation, and there are more angles subscribers can select.
Who’s the new CEO?FWPA appoints new CEO after global search - Forest and Wood Products Australia’s (FWPA) global search and recruitment for a new Chief Executive Officer (CEO) unearthed a number of highly qualified candidates. After a rigorous selection process, the Chair and Board are pleased to announce the appointment of Andrew Leighton to the role, commencing on 1st February.
“We were impressed by the calibre of people shortlisted for the job,” said Craig Taylor, Chair of the FWPA Board, “and on behalf of the Board members I would like to thank them all for their time and energy in applying. The successful candidate, Andrew Leighton, brings a wealth of technical, management and leadership experience relevant to the FWPA position of CEO.”
“Andrew’s senior executive roles have included 7 years as Managing Director of Norske Skog Australasia, time as Vice-Chair of the Australian Forest Products Association and a diversity of other positions that relate to the many areas in which FWPA is active. Andrew is the ideal person to continue the great work of FWPA, finalise and implement our new strategic plan, and lead the company into new areas of service to the Australian forest and wood products industry.”
“I see huge potential for increasing the applications for, and use of, forest and wood products as the world adapts to a carbon-constrained economy,” said Mr Leighton, “I have a longstanding passion for the forest products industry and a strong belief in its ability to play an important part in supporting environmental sustainability and driving the bioeconomy. I very much appreciate the importance of R&D investment and innovation and have a strong track record of championing this throughout my career.”
“As an observer I have been impressed with the range and quality of FWPA’s achievements throughout the supply chain and I look forward to building on that solid foundation,” he continued, “and one of my first objectives will be to meet with FWPA members and I encourage them to contact me at FWPA.”
Also this week we have news of two more new CEOs in Australia's forestry sector:
Ange Albertini at Forico (see more at https://forico.com.au/news/forico-appoints-a-new-ceo )
Carlie Porteous at AFCA (see more at https://ausfpa.com.au/afpa-welcomes-new-afca-general- manager- carlie-porteous/)
SnapStat - Maori primary industries asset base
John Deere updates lift user functionalityJohn Deere Announces New Options and Updates to the M-Series Tracked Feller Bunchers, Harvesters, and Shovel Loggers - Enhancements have been made to the previously released Smooth Boom Control (SBC), as well as Improved Seat and Heated-Ventilated Seat (HVS) and Premium Radio that is XM ready.
Updated Smooth Boom Control (SBC) improves the amount of pressure needed to operate a function, giving the operator more feel and control of the movement, especially during fine metering. This allows for a wider tuning range for individual functions and improves the set-up for multiple Operator preferences and skill levels.
“A machine’s ability to adapt to any operator using equipment for extended periods is vital to productivity,” said Jim O’Halloran, product marketing manager, John Deere. ”Continuous improvement is always top of mind when it comes to our equipment, and enhancing the machine control and operator comfort levels are prime examples of offering a greater customizable functionality to operators.”
The new dual density foam seat provides more support and comfort during operation. With improved seat cushioning, built-in contoured lumbar and thigh support and additional clearance for their thighs, all sizes of operators can feel comfortable in any desired seating position.
Additionally, John Deere has added adjustable suspension dampers to reduce vibration and provide more variable dampening. Lastly, for improved overall comfort, a heated and ventilated seat option has been made available. All seat configurations come with either a standard wide lap belt, or optional four-point harness.
For more information about John Deere M-Series Tracked Feller Bunchers, Harvesters, and Shovel Loggers, as well as the full range of forestry equipment and technology solutions, visit www.deere.com/en/forestry/
Nelson Council decides on forestryNelson the City Council Council to replant one third of its forestry committing to 30 more years of pine - A city councillor’s two-year fight to prevent Nelson City Council forestry land being replanted in pine ultimately failed its last-ditch attempt to change course. The council now faces another 30 years of commercial pine, unless it decides to rip out saplings from about a third of its 600 hectare forestry land a few years down the track. Skara Bohny explains the discussion from the last council meeting of 2021.
It is a saga that started publicly when councillor Rachel Sanson called for a “rethink” of council forestry due to concerns it was only of marginal financial benefit and at great environmental cost.
What followed was, in Sanson’s words, a “kafkaesque” process in which her best efforts to follow advice from staff and elected members has almost invariably culminated in accusations of trying to move too quickly and being out-of-step with council process.
Sanson has had some level of success, however. Though her own proposals have not usually managed to get majority support, her advocacy has resulted in a forestry review looking into the costs of developing a regenerative forestry plan prioritising indigenous planting (Sanson’s proposal was to simply develop a regenerative plan).
That review is due to come back to the council within the financial year of 2021-22, meaning the council will have an indication as early as April next year whether it will likely continue its commercial pine forestry under its current business-as-usual approach.
Australia: Murray Region forestry updateIn Australia, the South West Slopes Forestry Hub is pleased to announce that they will now be known as the Murray Region Forestry Hub (MRFH).
Murray Region Forestry Hub Chair, Peter Crowe, said, “This name change better reflects the geographical boundaries of the Hub region which extends from Gundagai in the north to Lake Eildon in the south. The MRFH has a total area of 3.5million hectares and encompasses around 170,000 ha of public & privately owned softwood plantations. This makes it home to one of the largest softwood-plantation forestry industries in Australia”. The Hub was initially established as part of the Australian government’s National Forest Industries Plan to support the forest & timber industry to:
• meet the challenges of the future and minimise constraints restricting industry growth
• underpin growth in the renewable timber and wood-fibre industries
• innovate and use our forest resources smarter
• assist industry to realise its ambition to plant a billion new plantation trees during the decade to 2030.
The plan reinforced the Australian Government’s commitment to securing a strong, sustainable forestry industry. It outlined a suite of key actions that:
• lay the foundations for the industry to grow
• assist with strategic planning in key forestry regions
• help to reduce barriers to investment
• identify the constraints limiting forestry and timber industry growth within the Murray region.
Mr Crowe concluded by saying that the Hub was looking forward to making progress on the projects identified under the Hub’s strategic plan that will address the national objectives at a regional level.
East Cape: Locals want transport optionsTrapped Residents Want Wharf Built At East Cape - Early December's road closure of SH35 between Opotiki and Gisborne has again highlighted the need for an alternative transport route for the East Coast.
In early December 2021, the highway between Opotiki and Waihau Bay remained fort a time to heavy traffic due to flooding and multiple slips caused by heavy rain in the area. The road was also closed further east between Lottin Point Rd and Pohutu Rd on the Gisborne side of the East Cape due to flooding, isolating communities between the two closure points.
“As climate change makes events like last week’s flooding more common, it’s clearer than ever that this region needs the security as well as economic benefits of a deep-water wharf,” says Dave Fermah whose company Terrafermah is working with local landowners and hapu, Potikirua Trust, to build the wharf at Potikirua , between Cape Runaway and Hicks Bay.
As well as being a boon to the East Coast’s logging industry and cutting carbon emissions, the multi-purpose wharf can provide alternative ferry or boat services to guarantee access to markets and essential services for some of New Zealand’s more remote communities.
The project received a setback in mid-December when the Government’s funding agency, Crown Infrastructure Partners (CIP), declined funding through its ‘Shovel Ready’ Projects fund.
Instead, CIP has given a competing project $2M initial funding to progress its proposal to establish a barging operation for logs in Te Araroa. Mr Fermah describes the decision as “extremely short-sighted”.
“We are disappointed for the region that CIP has chosen to progress a very limited and specialised barging operation,” says Mr Fermah. “It provides a worse outcome for the logging industry and offers none of the wider economic, climate or transport benefits that a multi- purpose port provides,” he says.
In addition, as last week’s flooding and slips showed, the proposed ferry service from the wharf can provide alternative transport options as well as backup during emergencies, he says.
“Waka Kotahi NZTA tells us they have budgeted $300m over the next 30 years to maintain this stretch of road. It is geologically unstable and our proposal takes all logging trucks off it,” Mr Fermah says.
Potikirua Trust chairman and local Coast Community Board Deputy Chair Allen Waenga says he had to put people up at Opotiki who had been trapped on that side of the road slip. “If we had our wharf, we could easily have sent them home on a boat,” he says.
Mr Waenga is disappointed that CIP did not make similar early funding available to his group. He believes the decision is too important to the region for the government to not have fully investigated the wharf option.
“I cannot believe that the Government did not accord us the same opportunities as others to fund a report and allow our hapus to undertake some environmental impact studies, as well as allow some extra time for our people to meet and discuss our options,” he says.
“This is a very important step-change in the future of our area. Ministers need to consider all options and allow local whanau and hapu to consider all options with all information. They have not done that.”
“They planted our lands in pine forests in 1970, and in 1972 recognised we needed a new wharf and commissioned studies. Fifty years later they still haven’t built what was recommended by the then-Ministry of Works and our people are still paying the price with logging trucks wrecking the roads and Māori landowners getting no returns on our lands from forest owners due to high transport costs,” he says.
Mr Waenga says his group is continuing to develop the wharf project and believes that its strong business case and wider community development opportunities make it an attractive investment for private or public partners.
“Upgrading transport links is the key to our region prospering,” he says. “It is time the Crown fulfilled the obligations they promised in 1972. Get us the reports so we can have our huis and get on with building our wharf.”
More on East Cape Wharf: www.eastcapewharf.com
How Kawerau people have adapted since 2020People in Kawerau have changed and adapted - The closure in June 2020 of the paper mill in Kawerau left 160 people out of jobs, forcing its workers to find new careers. For Hori Richmond, when the news came he would be without work he was heartbroken.
"It was more of a heartache impact, because it has been generations of families." After years of working at the paper mill, Richmond has found a new career, starting a plumbing and gas fitting apprenticeship. He told Newshub he loves the variety.
"You could be at one job for 15 minutes, you could be at a job for half a day or all day, and I like that. And back in the van, 15-minute job, and you're onto another one."
Kawerau only exists because of the historic mill. The town was established to service it, but as the world became digital the demand for paper dropped, meaning the mill couldn't survive. For Grant McKenzie, the mill is all he knew. He hadn't worked anywhere else, and now he is milking cows.
"Wow, the last time I was in the cowshed I was an 18-year-old - that was 50 years ago." Grant worked at the mill for a decade and expected to retire at the mill and once he was made redundant, he spent months finding a new career.
Rayonier team helps DoC saving the KiwiSaving the Kiwi – The Rayonier team in New Zealand team partners with local conservation organizations, students and Māori to protect the kiwi, a threatened bird that is a national symbol, in the Omataroa Forest. Rayonier’s New Zealand team has a deep respect for protecting wildlife including the beloved kiwi.
In the accompanying video, our the Rayonier team joined with a number of community stakeholder groups at Te Kura o Te Teko (a full-immersion Māori school) to attend a kiwi naming ceremony before releasing two kiwi chicks into Omataroa Forest.
The Omataroa Trust owns the land and has invested in environmental restoration including pest control and active kiwi management for the past two decades to ensure a sustainable population of kiwi for generations to come.
(For non-NZers: The Māori are the indigenous Polynesian people of New Zealand. Kiwi are flightless birds native to the country and are a national symbol of New Zealand.)
Concerns over historic station sale for carbon farm5000-hectare historic station on East Coast could soon be foreign-owned carbon farm - A recent news story from Newshub suggests the sale is all but final - it's pending approval from the Overseas Investment Office.
Locals are devastated and say it's the beginning of the end for not only farming in the region but the region itself. Huiarua is one of very few left on the coast - and one of the best. Locals believe it will be covered in pine but they won't even be harvested.
"Buying good land and planting it in trees, with the idea of just shutting the gate, is ridiculous," says local farmer Dan Griffin.
Under the Emissions Trading Scheme, set up to help New Zealand meet its carbon- neutral goal by 2050, carbon has become a currency. The trees earn 'credits' for the carbon dioxide they soak up and those credits can be sold to a company needing to offset its emissions.
It's a lucrative business, but Gisborne Mayor Rehette Stoltz is worried it will drive out communities because it won't offer jobs.
"Those families living there are the lifeblood of our smaller communities. Those are the families that fill up our schools, are the bus drivers, and if you take that away those smaller communities die," Stoltz says.
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Almost finally ... this looks crazy
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That's all for our mid-week wood news roundup.
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