China's lumber demand harms New Zealand's sawyers

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IHB
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In the last two decades, the value of New Zealand's forest products exports has more than doubled, mainly driven by log shipments to China. For example, in 2012, New Zealand's exports reached US$ 3,75 billion as compared to only US$ 1,58 billion in 1992. 

Moreover, the value of log exports has more than tripled from 1992 to 2012: from US$368.89 million up to US$1.33 billion. Since 2008, the export value had increased by an average 22% per year. New Zealand is now the third-largest exporter of logs in the world, after Russia and the United States, with an 8 percent share of the total value of the world's logs exports. 

The major influence for this fabulous increase was the demand from China, which rose from US$ 49,13 million in 1992 to US$ 832,92 million in 2012. China thus became the top destination for New Zealand's log shipments, surpassing both South Korea and Japan. 

But now, the New Zealand timber industry is complaining that the massive exports to China are driving out of business the domestic timber companies. The New Zealand Timber Industry Federation complains that ''many federation members were frequently experiencing downtime and production losses because they were unable to buy logs or log supply was stopped,'' Xinhua reported. 

"New Zealand sawmills are often paying top international rates for logs, so price is not an issue. It simply appears that some forest owners value their international customers more highly than domestic processors," NZTIF members complained.

Almost 3000 jobs had been lost in NZ wood processing sector since 2008 and more companies are going to close business if this situation will continue. In the future, New Zealand may be forced to import timber due to the shortage of product for the domestic market.

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