China Wood Products Prices
16-30th April 2004

Dollar Exchange Rates of 23th April 2004
China Yuan 8.28
Report from China  

Prices Increased in First Quarter

In the first quarter of 2004 timber prices rose noticeably. Regional, prices started to move up in the south eastern coastal regions and some major cities such as Beijing, Tianjin, Shanghai, Guangzhou and Shenzhen, and then price increases were reported in the more western regions.  Now, price increases are reported nationwide.

In terms of timber species and products, prices increases for imported logs, sawnwood, wood-based panels and wooden flooring were most obvious. However, price movements for domestic timber products were smaller and, in some cases prices weakened because of weak demand.

Price for logs and sawnwood increased in the major timber markets such as Guangdong Yuzhu International Timber Market, Zhejiang Nanxun Timber Market, Shanghai Furen Wood Products Wholesale Market, Tianjin Huan Bo Hai Timber Market and Shandong Dezhou Timber Market.

The average price increase was around Yuan 50-120 per cubic metre, on a year on year basis. Especially obvious were price increases for tropical hardwoods and timbers from North America. For example, prices for African Sapele from Ghana and Cameroon went from Yuan 5500 to around Yuan 6400 per cubic metre.

Prices for Maple from the U.S rose to Yuan 11,500 from Yuan 10,000 per cubic metre last year. In addition, prices for Teak, Padauk and Wenge increased by about 10%. Although prices for softwoods from Russia and New Zealand increased only slightly, prices for 4 m length 38 cm diameter, high quality Korean Pine, increased to Yuan 1450 from Yuan 1350 per cubic metre.

Prices for Radiate Pine rose to Yuan 500 from Yuan 450 per cubic metre and showed signs of strengthening further. Prices

Price increases were obvious for sawnwood than for logs. For example, prices for Padauk, Red Beech, and Luan exceeded Yuan 8000, Yuan 4500 and Yuan 3000 respectively. Prices for imported wood-based panel also increased at different rates due to the higher costs of logs. Price for wood flooring, the main material for interior decoration also gained ground moving up around by 6% in the first quarter.

According to local analysts, the main reasons for price movements are as follows:

Many major projects have been initiated especially for urban reconstruction and housing development and this is contributing to the strong demand for timber and wood.

The prolonged dollar depreciation has resulted in relative currency appreciation in some major supply countries (such as Canada, New Zealand and European Union) and this has contributed to  price increases.

International ocean freight costs have increased sharply since last year.

Also, as authorities crack down on domestic transport companies who have been regularly exceeding load weight limits for trucks, domestic haulage costs have increased.

China's Major Log and Sawnwood Supply Countries

 MDF Production Capacity  

According to statistics from the Fiberboard Special Committee of the China National Forest Product Industry Association, at the end of January 2004, China has 444 production lines for medium and high density fiberboard and the total production capacity had reached 18.16 million cubic metres (this excluding mills in Hong Kong, Macao and Taiwan). In terms of production capacity for medium and high density fiberboard (whose production 75% of the national total).

 Furniture Exports to South Korea

 According to the South Korean Daily News, China's furniture exports to South Korea have been increasing. Export were valued at US$ 38 million in 2001 and US$85 million in 2002, a year on year increase of 126%. Exports further increase to US$172 million in 2003. In the first quarter of 2004 exports of furniture from China to South Korea reached US$55 million, a massive 70% increase. It has been reported that China has now become the biggest furniture supplier to South Korea and Chinese furniture exports first exceeded those from Italy in 2002.

 Guangzhou City Imported Timber Market  

 Shanghai Furen Wholesale Market 

Hebei Shijiangzhuang Wholesale Market  

 Shandong De Zhou Timber market  

Tian Jin City Huan Bo Hai timber Market