WoodWeek – 16 March 2022

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Welcome to your Wednesday wood news update. Today we go straight to the port for the market update with our monthly update from the team at Champion Freight. With statistics for log export reporting just in for the January month, the slowdown we've seen in log exports to China has continued through this month. Exports for the month were well down on the same month in 2021.

For the month ended January our log exports to China saw shipments dropped by 40 percent, compared to Jan 2021, dragging overall log exports down 34 percent. Notably, logs to Japan were up non-existent (zip, zero, nil) for the month.

In our news from Northland today, Manulife Investment Management Forest Management NZ Ltd general manager Kerry Ellem said the only disruption to log prices and the export market at this stage was Covid. His company, previously known as Hancock Forestry, is one of the biggest forest managers in Northland and even during a downturn in the export prices late last year, Manulife continued to export logs predominantly to China and to smaller markets like India, Japan, South Korea and Taiwan.

"Things are looking better and while log prices have improved, the cost of international freight is quite high so they cancel each other out. It costs around $US$70 a ton to send logs from New Zealand to China at present and that cost was $40 in January,” says Ellem.

We hope you enjoy this week’s statistic in a snapshot: SnapSTAT. on this. Thanks to our feature sponsors - Chainsaw & Outdoor Power and Oregon for their support.

Registrations are flowing in for our newest event, FIEA Environmental Forestry 2022 Conference. See our event website for our practical and learned speakers’ programme. We have addressed issues highlighted by forest companies large and small. There are plenty of good practices being developed up and down the country. Our new conference, is designed for foresters, forest managers and people with ‘boots-on the-ground’ across our management and contracting workforces. Registrations are open now, see the website.

As you are aware, Te Uru Rākau – New Zealand Forest Service consulted on the proposed design of the initial registration system for log traders and forestry advisers in late 2021. The Government has now made its decisions on the system and service requirements that will come into force on 06 August 2022.

Te Uru Rākau – New Zealand Forest Service now welcomes your feedback on proposed funding options to support the establishment of the registration system and to cover the cost of the services it will provide. See details of the consultation document and supporting information on preparing and submitting a submission in today's issue.

Finally, today we are pleased to advise that registrations will be opening soon for 4th Carbon Forestry Conference. It will run it as an in-person event on 9-10 August in Rotorua with online registrations available for people outside of New Zealand.

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Champion Freight: Log export market update

This week we've got our monthly update from the team at Champion Freight. With statistics for log export reporting just in for the January month, the slowdown we've seen in log exports to China has continued through this month. Exports for the month were well done on the same month in 2021.

For the month ended January our log exports to China saw shipments dropped by 40 percent, compared to Jan 2021, dragging overall log exports down 34 percent. Notably, logs to Japan were up non-existent (zip, zero, nil) for the month.

Year-on-year the chart shows total log export values to China to the end of January were 33 percent contributing to overall log exports being buoyed by 26 percent across all export markets. Log exports to South Korea were up for the year by 10 percent up while volumes while logs to Japan were up 21% and to India were down 68%.

More>>

Source: Champion Freight

Recapping news from Forest360 last week on log exports: Freight has taken the fun out of any price increases with freight rates increasing at a similar rate to sales prices. Some of this is attributed to fuel as barrel prices climb out the gate. To compound issues, the EPA introduced a host of new rules in January this year that all but prevent the use of Methyl Bromide for fumigation. Methyl Bromide is a key fumigant for cargos bound for China which is used on port to fumigate the logs that are stowed on the top deck of a vessel. Now that this is all but impossible, exporters have had to move to debarking deck stowed logs or finding vessels that carry full under deck cargos, further increasing costs and port congestion.

The effect of the Ukraine invasion on freight rates is yet to be fully understood. Putin’s navy conveniently lobbed a missile into the side of a Bangladeshi cargo vessel last week in the Black Sea which has put the frighteners up the shipping industry. This, and the threat of excluding Russia from the Swift payment system, is seeing many of the vessels operating in the Atlantic now headed south to the Pacific which will hopefully free up some capacity and counter some of the increased fuel costs.

March at wharf gate (AWG) export prices surprised many with solid increases from a number of exporters but a very wide spread of around $15/JAS between either end of the spectrum. A grade in most ports (excluding Gisborne) is in the early $140’s/JAS which is $10/JAS over the 3-year average. The disparity between exporters is primarily due to the rapidly increasing freight costs with some having been smart/lucky enough to fix March rates earlier than others.

It is likely that the CFR price will continue to climb over the next few months and the ability to see this in AWG prices will rely solely on how far the shipping companies can push their rates. To compound matters, the $NZ:USD has climbed $NZ0.02 over the past few days which has the net effect of removing $NZ5/JAS from sales prices.

NZ log supply is usually peaking during March but Covid will probably pull the handbrake on as it infiltrates the supply chain. The biggest issue will be at the ports with marshalling companies already signalling reduced hours in reaction to staff illness. Port congestion is generally an issue at this time of year anyway but, as every log needs to be measured and bar coded before it’s loaded on a ship, absenteeism is likely to put a stranglehold on the NZ supply in the short to medium term.





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Residues To Revenues: Scaling up

In a bioenergy story this week, Genesis Energy have commented that they believe that converting part of the Huntly power station (New Zealand’s largest thermal power station) to run on biofuel could be economic.

However, it’s going to need a source of a specialist wood fuel (steam - exploded wood pellets), which they suggest the NZ government could lend a hand to help set up.

Scaling up is what they’re pushing for – and it’s this scaling up of a reliable and consistent resource of biofuel that’s going to drive the switch from coal by larger industrial heat users like Genesis. That may happen with new harvesting, transport and wood handling technologies.

Also collaboration by forestry and wood products companies regionally is needed to meet the increasing demand for biomass. Both these issue and more will feature in our upcoming Wood Residues 2022 Conference coming in July for ourforestry industry. Our event runs on 26-27 July in Rotorua, New Zealand. Full details including both the programme and registration information can now be found on the event website.



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Harvester technology goes wireless

In November last year, the technology company Dasa in south Sweden launched the World’s first wireless control system for harvester heads – Dasa Wireless 1. Except for power supply, all cables between the cabin and head now can be removed. The result is a harvester with fewer parts that can break down and to maintain.

Dasa Wireless 1 – The harvester head manufacturer SP Maskiner has tested the system on a harvester for one year now. The sister-site Skogsforum.se visited a machine that is equipped with one of the first Wireless 1 systems to find out more.

A login contractor Ola Bokelund has been testing pilot for the system and Skogsforum.se visited him already one year ago to see his new Eco Log 1058H harvester (former Gremo). The Dasa Wireless 1 was already running on the machine back then, but that was a secret.

More >>





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Victoria: Forestry research boost

(Australia) Victoria’s forestry industries are set to benefit from five new research projects funded by the National Institute for Forest Products Innovation (NIFPI) centre in Gippsland. Federal Assistant Minister for Forestry and Fisheries Jonno Duniam, and Victorian Minister for Agriculture Mary Anne Thomas congratulated the funding recipients and welcomed the benefits these projects will bring to Gippsland and the wider industry across Australia. The new projects have been backed by funding from the Federal and Victorian governments.

“The Gippsland NIFPI centre has funded five new forestry research projects leveraging a total of AU$4.5 million that will increase the productivity and sustainability of the forestry sector in Gippsland,” Assistant Minister Duniam said.

“Gippsland is a proud forestry region and the AU$2 million of Australian Government funding to the NIFPI, matched by Victoria, is helping to ensure that continues well into the future. The research funded under this round will look at opportunities like remote controlled pruning for improved fire management, productivity enhancing tree breeding, nursery management and soil research, and the commercial opportunities available for smaller diameter plantation logs in Gippsland.”

The Australian and Victorian government project funding includes:
• AU$360,000 for Western Sydney University to develop innovative nursery management solutions to sustainably manage root disease, improve nursery utilisation, and enhance resilience and productivity of planted pines.
• AU$362,000 for Treebreeding Australia to look at how single-step genomic sequencing can deliver sustained productivity gains in softwood plantations.
• AU$90,000 for Federation University to increase productivity for radiata pine plantations by better understanding soil resources.
• AU$300,000 for Sylva Systems to conduct a feasibility study of a commercially available remote- controlled and high-rate tree pruning unit to create fuel modified zones in softwood plantations.
• AU$300,000 for Radial Timbers Australia to evaluate commercial opportunities for laminated veneer lumber from underutilised small diameter resource in Gippsland.

For more information go to https://nifpi.org.au/



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SnapStat - Carbon market update graphs




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TUR-NZFS consulting on cost recovery

As you are aware, Te Uru Rākau – New Zealand Forest Service consulted on the proposed design of the initial registration system for log traders and forestry advisers in late 2021. The Government has now made its decisions on the system and service requirements that will come into force on 06 August 2022.

We now welcome your feedback on proposed funding options to support the establishment of the registration system and to cover the cost of the services it will provide.

The consultation document and supporting information on preparing and submitting a submission can be found here: https://www.mpi.govt.nz/consultations/cost-recovery-for-the- registration-of-log-traders-and-forestry-advisers

Public consultation closes at 5pm on 1 April 2022.

If you have any questions, please email costrecovery@mpi.govt.nz


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Northland forestry workers head south

Some forestry contractors are moving out of Northland due to a paucity of work, although international log prices and the export market have improved.

Export prices for A-grade unpruned logs fell from $171 per cu m in June to $108 in December, forcing the likes of Northland-based Fusion Logging to stop work and lay off staff just before Christmas. International log price this week has been sitting at $US160 but rising fuel prices are starting to impact on international freight costs.

The owner of Fusion Logging, Ernest Morton, has had to reduce his workforce from 27 to eight before letting everyone go before New Year.

"The prices have improved to keep us going at the moment but there's always the problem of getting workers back during Covid and even if we re-start operations, we are unsure what's going to happen in future. People are starting to move south to places like Gisborne for greener pastures because there's not much harvesting to be done in Northland as was a few years ago. Silviculture will be in good demand up here."

Manulife Forest Management NZ Ltd general manager Kerry Ellem said the only disruption to log prices and the export market at this stage was Covid. His company, previously known as Hancock Forestry, is one of the biggest forest managers in Northland and even during a downturn in the export prices late last year, Manulife continued to export logs predominantly to China and to smaller markets like India, Japan, South Korea and Taiwan.

"Things are looking better and while log prices have improved, the cost of international freight is quite high so they cancel each other out. It costs around $US$70 a ton to send logs from New Zealand to China at present and that cost was $40 in January.

More >>

Source: Northern Advocate


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Government: Climate programmes delayed

(Newsroom) Climate programmes delayed after failed Budget bid - A range of climate change programmes had to be delayed or scaled down after the environment ministry got less than it asked for in Budget 2021, Marc Daalder reports.

Efforts to rein in the over-subsidising of large industrial polluters and a law that would enable a managed retreat from flood-prone coastlines were delayed because funding for them wasn't received in Budget 2021.

These were just two of several parts of the climate change work programme delayed or scaled down as a result of the failed Budget bid, according to a June Cabinet paper from Climate Change Minister James Shaw.

"I have had to make significant changes to the climate change work programme to fit within the appropriation for this financial year," Shaw wrote in the paper, which was proactively released by the Ministry for the Environment (MfE) in December.

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One of the key policies delayed as a result of the failed Budget 2021 bid was an effort to reform the Government's industrial allocation programme. This scheme sees the Government grant free carbon credits to large greenhouse gas emitters and exporters to help them compete with international rivals that don't face a carbon price. The settings are out of date, however, meaning that more than $100 million in carbon credits is over-allocated each year.

The chief recipients of these excess subsidies are the Tiwai Point Aluminium smelter, which earned nearly $60 million in carbon credits above what it was meant to in 2020, according to a Newsroom analysis. Pulp and paper producer Oji Fibre Solutions and NZ Steel each received more than $30 million in additional carbon credits that year as well.

Source: newsroom


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More wilding pines control programmes

Waikato Regional Council has started wilding pine control in new locations in the Coromandel Peninsula - The control work in Opito Bay and Whenuakite is part of operations on the peninsula that received funding through the Ministry of Primary Industries’ wilding pine control programme, with work already completed at Black Jack Reserve and on AhuAhu/Great Mercury Island.

Control work continues on the Matarangi Bluff Scenic Reserve. The funding for the control work in Opito Bay and other parts of the Kūaotunu Peninsula was applied for by Kūaotunu Peninsula Trust with support from the Opito Bay Ratepayers Association, Project Kiwi Trust and Rings Beach Wetland Group.

In Whenuakite, the control sites are on a total of about 108 hectares of private land in Boat Harbour Road.

Waikato Regional Council project manager Clark McMichael says the targeted areas have sparse to dense mature coning trees which will be controlled by drilling and filling with herbicide or chainsawing. Seedlings and smaller trees will be hand pulled or hand sawn.

“Wilding pines are a threat to biodiversity and the primary sector and, if nothing is done to control them, within 30 years they will have taken over significant parts of New Zealand’s iconic landscapes and unique natural habitats,” says Mr McMichael.

Wilding pines spread prolifically from seed and grow fast to form a dense canopy which shades the forest floor, killing and preventing the growth of all other plant species and displacing the habitat of native animal species. The Coromandel Peninsula has many iconic New Zealand native species, including Coromandel brown kiwi, kākā, long-tailed bats and kauri.

“Wilding pine control also presents potential risk to these species through disturbance, so we have surveyed the sites for their presence and have strict procedures in place where they exist.

“No wilding pines will be felled where kākā or kiwi are nesting or bats roosting – control will be by drill and fill – and clean hygiene protocols for kauri protection will be carried out by contractors working near kauri.”

The Government in 2020 allocated funding of $100 million over four years to expand the National Wilding Conifer Control Programme. This funding is managed by Biosecurity New Zealand, which is a business management unit of the Ministry for Primary Industries.

About $1.3m went towards nine community projects in Coromandel and Taupō. To find out more about the community projects in the Waikato go to waikatoregion.govt.nz/wilding-pines



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Maori forests for Maori housing

A Māori housing advocate says it’s time to disrupt the model for building - Willie Te Aho has been developing housing around Raukōkore and the East Cape, moving prefabricated homes from Huntly.

But he says the building materials crisis and Covid-related delays are slowing down supply, and he wants to move the prefabricating close to the job, using local timber.

“We’ve got two forests, one where I am here at Raukōkore and another in Waipaoa 3B at the back of Tūranga-Gisborne. We will be taking sawmilling operations into both of those forests to create more wood. We need about 900 tonnes from each forest and that will create the 150-plus houses we need,” he says.

Mr Te Aho says excellent support from Māori ministers Peeni Henare and Willie Jackson means the MAIHI Māori housing programme is starting to develop momentum.

More >>


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Ranger beats Tesla in near record car sales month

(Autocar) Ford Ranger still ruled the sales charts for 2021, but Tesla Model 3 broke into the top 10 - New Zealand’s transition from level 4 lockdown into level 3 has resulted in one of the biggest months in local car-sales history, with 16,518 new vehicles being registered according to the Motor Industry Association (MIA).

Those numbers represent an increase of over 50 per cent compared to the same month last year. The MIA claims that it’s the second strongest month ever recorded in its time collecting data.

The Ford Ranger led the pack with a whopping 1408 registrations. As previously reported, the Tesla Model 3 was the country’s most popular passenger car, a local first for the brand and for the plug-in genre. It was second overall, with 1066 registrations.

The Mitsubishi Outlander rounded out the podium on 963 registrations, ahead of the Toyota Corolla (744), Toyota Hilux (648), Toyota RAV4 (575), Mitsubishi ASX (472), Mitsubishi Eclipse Cross (427), MG ZS (329), and Mazda CX-5 (296) in tenth.

There were several curious absences from that top 10. Most notably, only two utes appeared, with the Mitsubishi Triton, Nissan Navara, and Mazda BT-50 failing to even appear in the top 15. Ford’s Ranger- based Everest, meanwhile, had a rare strong month, appearing 15th.

Toyota once again led the month for market share, holding 18 per cent over Mitsubishi’s 13 per cent and Ford’s 11 per cent. Tesla narrowly missed out on the podium, ending the month fourth outright.

More >>

(Driven) Ranger beats Tesla: NZ records one of the strongest months of car sales ever.

More >>

Source: Autocar & Driven


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... and finally ... did you exercise today?

Hey! In case you feel bad about missing your exercise lately, ponder this:
• The inventor of the treadmill died at the age of 54.
• The inventor of gymnastics died at the age of 57.
• The world bodybuilding champion died at the age of 41.
• The best footballer in the world, Maradona, died at the age of 60.
• James Fuller Fixx, credited with helping start America's fitness revolution by popularising the sport of running, died of a heart attack while jogging at age 52.

BUT ...
• the KFC inventor died at 94.
• cigarette maker Charles Winston died at the age of 102.
• the inventor of opium died at 116 (in an earthquake).
• and, the Hennessey Liquor inventor died at the age of 98.

How did smart people come to the conclusion that exercise prolongs life? Look around us ... rabbits are always jumping up and down, but only live for only two years. On the other hand turtles don't exercise at all, yet can live for 400 years.

Get some rest, chill, stay cool, eat, drink and enjoy your life in 2022!



That's all for our mid-week wood news roundup.

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