Australia, wood chips export volumes decline
The exports of forest products in Australia have declined by 5.1 – 5.3 per cent to $2 billion for the period of 2008 – 2009. It was caused by a significant drop in the cost of woodchips, packaging and industrial paper exports.
The decline of woodchips exports is interrelated with the decline of Australia’s structural wood products that was marked by the increased housing activity in 2008. In 2008-09, total dwelling commencements dropped by 16 per cent to 135 000 units.
During the first half of 2009, Australia - the biggest wood chips exporter, has cut off the supplies for 28%. The most significant cut off has been tracked at the export of softwood and hardwood to Japan, estimated to 31% and 36% accordingly in comparison to the same period of 2008. The experts explain such situation by weak pulp market in Japan and specify, that pulpwood price increased by 13% in Australia due to local currency strengthening.
Resulted in pulp manufacturing decrease and appropriate demand fall for wood fiber in Japan during last year the exporting countries, such as Australia, were forced to find alternative markets. In 2009 the eucalyptus chips export amount to Japan was down for 74% from total amount of all Australian hardwood chips export comparatively to 86%, exported last year. The other significant markets for chips importing are China, Taiwan and South Korea. China has been the biggest exporter last year, having increased their export amounts more than in two times and attained the amount over 470 000 tons during first eight month (partially softwood, but mostly hardwood).
Despite eucalyptus export cut off in Australia, the domestic consumption of the aforementioned material is growing constantly as fast growing plantations grow. In the second half of 2009 the eucalyptus sales amount increased by 21 % in comparison to the same quarter of past year.
Due to Australian currency strengthening, the prices for softwood and hardwood fiber were significantly higher in US currency and slightly lower in the second quarter. According to industry experts’ data, the eucalyptus pulplog prices grew by 14% and eucalyptus chip prices for the use inside Australia grew by 13%.
The export pricing for eucalyptus chips supplied to Japan remained on the same level as in the first quarter of 2008 and 2009. Industry professionals state the drop down for softwood chip export prices for chips, delivered from Poland, Victoria from US$19/BDU to US$140.50/BDU (US$129/odmt) (prices are not recognizable) in the first quarter of 2009. Plus, they indicate that the cheapest softwood chips delivered to Japan were the Australian ones in the second quarter of 2009, bating only the Douglas fir chips from US. The most expensive fiber delivered to Japanese pulp mills are Radiata pine from New Zealand and spruce pine fir chips from Canada.
It is noteworthy that China increased its imports of Australian woodchips by 72 - 75 per cent to 490 000 bone dry tonnes in 2008-2009. While China currently buys a small proportion of Australia’s woodchip exports, it is likely to have strong growth potential into the future relative to Japan.
