After the 2022 February Spring Festival both log and lumber stocks have been accumulating at ports but, due to slow demand, the inventory of the major wood market dealers has been running high. The ports are overstocked with logs and the stock of logs at Taicang Port have reached a record high of 1.7 million cubic meters, resulting in a sharp drop in both logs and lumber imports compared with last year.
According to China Customs, log imports were 18.04 million cubic meters valued at US$3.641 billion, down 30% in volume and 14% in value from January to May 2022. China’s lumber imports fell 7% to 10.78 million cubic meters.
In May alone, China’s log imports amounted to 4.23 million cubic meters valued at US$888 million, down 20% in volume and 14% in value. China’s lumber imports declined 11% to 2.26 million cubic meters. Because of heavy rain in the south and high temperature in the north the logs are degrading especially radiata pine logs.
Mid-year is a traditional off-season for the wood products industry as many regions of China have a rain season. This year the rain season arrived earlier than in previous years.
Depressed timber demand
It has been reported that prices for gasoline and diesel have been raised which means higher transportation costs for the Chinese timber industry and reduced profits for traders. Market demand continues to be sluggish and has been down since the beginning of the year.
The very changeable weather and the surging production costs are disturbing the Chinese wood product manufacturers.
Rise in transport cost for African timbers
A distinct trend in rising landed prices for timbers from Africa to China has been especially noticeable for shipments from Cameroon and Gabon and this has been put down to the increase in oil price. It is expected that the cost of imported African timber will continue to rise.
Manufacturers expect most of the increased costs to be borne by the timber dealers as there is little opportunity to raise prices for finished goods in the current depressed market.
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