Forty-three people from various parts of New Zealand’s domestic and international forest products supply chains participated in the latest Forestry Business Outlook. These participants represent a substantial component of the NZ forestry industry. Source: Timberbiz
While coronavirus continues to dominate the comments from participants, impacts on the sector, particularly in terms of planting labour, international log over-supply and the global economic recession were also of concern to respondents.
The majority now anticipate a steady and stable year ahead, with fewer respondents indicating negative business confidence.
Respondents indicate prices remaining between NZ$114/m3 and NZ$118/m3 for unpruned, and NZ$151/m3 and NZ$154/m3 for pruned logs over the coming 12-month period, and similar steady volumes of logs both for domestic and international markets.
Participants noted much lower disruption overall to their supply chains due to the COVID-19 pandemic than in May but continued major disruption from both international and domestic customers.
In sharp contrast to the expectations of further labour shortages due to Covid-19 and loss of seasonal workforce, labour supply has actually improved from last year, although shortages are still apparent in planting and silvicultural work, mainly from a lack of overseas workforce.
Respondents see gradual price increases for both pruned and unpruned logs over the next three months, before a price decrease in February for unpruned logs to under NZ$115/m3, while pruned logs hold firm for the remaining year at NZ$153/m3 out to Aug 2021.
The report also looks at the log price outlook, business confidence, the impacts on forestry business due to the pandemic, domestic processor long term agreements and busines expectations.
You can download the full report here AUG2020LogPriceOutlook
