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International Log
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International
Log Prices Sarawak
Log Prices
FOB
log prices remain firm Apart
from limited supplies, the strong demand from China and India has
continued to contribute to the steady rising in FOB prices for Far Eastern
tropical logs. FOB price rises have been apparent for all the key species
including meranti, keruing, kapur, merbau and selangan batu. Francophone
West African Log Prices There
have been some small downwards adjustments of the prices of some grades
during during July and the first part of August, otherwise log prices have
remained largely stable and unchanged. Iroko
prices retreating Iroko
prices are now under pressure as European buyers feel they had moved too
high for current market conditions, even though supply is very limited. As
a result, Iroko prices have retreated, though production remains very
restricted as harvestable trees now tend to be more remote and less
abundant. Some Irish buyers are making a shift to sapelli which is seen as
cheaper and abundant.
Rainfall
is hampering wood felling in the areas to the north of the equator, which
is affecting log supply. However, the demand for most African wood species
has fallen against previous months due to the holiday period in Europe.
Some traders believe that iroko prices will stabilize once European buyers
return to business after the summer vacations. The rains have begun in
Cameroon making logging more difficult. In Congo‑Brazzaville it is
still dry and reports are of very large volumes of okoume logs being
shipped out, while okoume exports from Equatorial Guinea continue to
decline to a very low level as forest resources become exhausted.
MYANMAR
Hoppus ton = 1.8 Cu.m Prices
for above listed grades of Myanmar teak logs showed mixed trends in June
and July. However, this was in contrast to April when prices for most
grades declined drastically. PAPUA
NEW GUINEA New
tenders Tenders
for the development of new forest management areas in PNG will close on
5th September 2005. The period of the permits will be for 35 years.
AAC=
Annual allowable cut Changes
to PNG Forest Act approved On
August 3rd 2005 the PNG parliament passed the forestry Act Amendment bill,
under which the Forest Industry Association will again be given a position on the
National Forest Board, replacing the PNG Chamber of Commerce and an
‘industry representative’. Also, the Eco‑forestry Forum has been
replaced by one member from the community involved in forest activities. Other
changes related to rectifying typing errors, reference to provisions, the
inclusion of terms to clarify and simplify procedures and processes, and
the inclusion of new provisions to cover loopholes in the Forest Act.
Other amendments also included language under which provincial governments
and members of the Parliament not otherwise mentioned would be consulted
on the National Forest Board’s intentions to enter into a Forest
Management Agreement.
Trade statistics Below
are estimates for shipments of PNG logs to main destinations in 2004. For
the first half of 2005, log exports from PNG amounted to 1.1m cu.m at a
value of $67m. Saw/veneer log grade exports amounted to 189,477 cu.m. In
plantation species, Kamarere remains the main export species, primarily to
the markets of Japan, Vietnam and Korea.
Domestic
Log Prices BRAZIL
Shortage
of roundwood Roundwood
supplies in Brazil have been affected by a transportation stoppage in Mato
Grosso State. The transportation stoppage was ordered in connection with a
corruption scandal at IBAMA discovered in June. According to several
importers, Brazilian plywood manufacturers have been affected. Mato Grosso
state is located in the south‑west of Brazil and is, together with
Pará state, the most important roundwood supplier in the Amazon region. INDONESIA Indonesia
increases harvest quota Indonesia’s Minister of Forestry announced that the harvest quota for natural timber for 2006 would be increased to 7.9m cu.m, 46% more than in 2005. The quota had been reduced to 5.45m cu.m in 2005 to achieve sustained yield, which the government believes has been achieved to a certain extent. After severe control of illegal harvest under the reduced quota, the situation seems finally to be settling down and the government has decided to again increase the harvest. With the increased quota, plywood and lumber mills, which halted operations due to suspended licenses, are said to be ready to run again. The
Minister explained that the new quota is opportune given the increased
wood demand for the restoration of Sumatra in the wake of the Indian Ocean
tsunami late last year. The harvest quota in recent years in Indonesia was
as follows: Allowable
harvest quota in Indonesia (mill. cu.m.)
PENINSULAR
MALAYSIA
GHANA
PHILIPPINES International
Sawnwood Francophone
West Africa Sawnwood prices are unchanged through the first half of August, though some producers report that prices are under some downwards pressure. Cameroon shippers are said to be asking slightly lower prices than those in Gabon and other countries; however, mills in the region are confident that the market will remain firm and stable through to the fourth quarter. It
is not yet clear what impact on the African trade India’s planned
relaxation of its high import duties on sawnwood and other processed
products next year will have. According to some observers, Indian buyers are currently very
active and certain that prices will hold up right through the fourth
quarter. The impact of a change in India’s import tariffs on the African
trade is unknown.
BRAZIL
MALAYSIA Sawnwood prices generally have not risen at the same rate as log prices if taking into account that a $10 per cu.m. increase in log prices should roughly correspond to a rise of $30 per cu.m. in sawnwood. In contrast, plywood prices have surged more accordingly to increased log price rises. Malaysia
to ban export of rubberwood products China’s
demand for wood continues to grow unabated. South East Asian countries,
which are major sources of raw material and also have large processing
capacity, are caught between supplying their own industries and meeting
China’s demand. As
a result of domestic furniture industry complaints about a lack of raw
materials, the
Malaysian Government announced recently a ban on Rubberwood sawntimber
export and there will be no new quotas for the export of such timber with
immediate effect. Before,
a quota system was applied to the export of rubberwood sawnwood, with 60%
used for domestic consumption and 40% for export. The
unutilised quotas approved earlier will be allowed to continue for the
exports of rough sawntimber. The annual production of rubberwood
sawntimber is variously estimated at between 350,000 to 500,000 cu.m. It
was estimated that 80% of rubberwood sawntimber is consumed by the
furniture industries alone. The imposition of the export quota by the
authority is to ensure that the rubber plantation owners enjoying a fair
price for the raw material and at the same time the authority is also
trying to ensure that there are adequate raw materials for the industry.
INDONESIA Indonesia
restricts export of sawnwood, rattan The
Indonesian government, which banned the export of rough-sawn timber in
October 2004 in order to revitalize its domestic wood processing industry,
wants tighter controls on this ban because it believes that air-dried
sawnwood is still being exported. The announcement of tighter controls
prompted complaints from local mills, which insisted they had been
observing the rules. After several meetings, it was agreed that the
original rules would be maintained but that mills must submit written
pledges to BRIK (Indonesian association of vitalizing wood industry). It
was also reported that Indonesia will ban the export of semi-finished
rattan products because the domestic furniture industry has increasing
difficulty in obtaining sufficient supplies; China is a major importer.
Indonesia had already banned the export of unprocessed rattan. GHANA Air-dry
FAS 25-100mm x 150mm and up x 2.4m and up.
Ghana’s
Export duties reduced In Ghana, a new directive seeking to remove the export
levy on lumber, veneer and plywood exports has been issued to the Customs,
Excise and Preventive Service (CEPS) and other stakeholders. The move is
intended to reduce the operational costs of timber exporting industries in
the country. However, the ban on the export of round or square logs is
still in force. The
minister announced that the National Reconstruction Levy (NRL) Act, which
sought to reduce various rates of national construction levy (known also
as development levy), has received Presidential approval. The Act revised
downwards the A to D categories of NRL paid by companies. The levy
categories were reduced from 10% to 7.5%; 7.5% to 5%; 5% to 3.5% and 2.5%
to 1.5%, respectively. The levies will be further reduced in 2006 and
eventually eliminated by 2007. PERU Peruvian
timber exports rose 44% to over $80m in the first half of 2005 compared to
the same period in 2004 ($55.7m). The USA was the main destination (44% of
total timber exports), followed by Mexico (33%), China (9%), Hong Kong,
SAR (2%), Italy (2%) and others (4.6%). The first five countries
represented almost 90% of Peru’s timber exports. Around
54% of US imports were Mahogany sawnwood, followed by Virola sawnwood,
hardwood friezes, and furniture parts and pieces. Mexico’s imports
consisted mainly of Virola and Marupa sawnwood, and plywood. China and
Hong Kong, SAR imported mainly hardwood friezes. Sawnwood,
main export product
Sawnwood
continued its standing as the dominant export
timber product, accounting for 59% of all timber exports. It was followed
by friezes and decking (15%), plywood (11%), furniture parts and pieces
(9%), plywood and veneers (3%), and other products (3%). The first five
product categories accounted for over 97% of all Peruvian timber exports.
However, the surge in timber exports was primarily driven by an increase
in the export prices of mahogany sawnwood, friezes and plywood. Declining
production concerns local exporters
Although
timber exporters have greeted the increases in exports with enthusiasm,
they are concerned by the lack of raw material. Log production has been
decreasing since 1999, when production reached 1.55m cu.m; in 2004 it was
1.2m cu.m. This production involves 195 timber species, with 10 of them
representing 87% of the national production and the balance of the
production represented by 185 species.
Mahogany
exports reached 10,283 cu.m in June
Following
the establishment of a national export quota for mahogany (Swietenia macrophylla) of 23,621 cu.m. for 2005 (see MIS 10/11),
customs authorities reported that Peruvian mahogany exports reached 10,284
cu.m in the first half of 2005; the trade was worth $21.3m. The USA is by
far the largest destination market, accounting for just over 90% of
mahogany exports ($19.2m). Other export markets include Dominican Republic
(4%), Germany (2%), Puerto Rico (2%) and Sweden (1%). Domestic
Sawnwood Prices Brazil
MALAYSIA
The
demand for rubberwood, the most important furniture timber in Malaysia,
has diminished. This was probably attributed to a slowdown in the
furniture demand. At the same time, manufacturers of rubberwood sawnwood
from Southern Thailand are pushing their products to the Malaysian market.
This added supply has resulted in lower prices for rubberwood sawnwood. GHANA
PERU
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Abbreviations
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Source: ITTO
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