Even if China increases imports from Europe and New Zealand, there will be a gap of of 8.66 million cubic meters of logs by 2022.
Chinese timber imports from Australia were banned at the end of 2020 and Russia also announced that it will ban log exports in 2022. Taking into account that in 2020, 4.565 million cubic meters of logs were imported from Australia and 6.341 million cubic meters of logs from Russia in 2020 there is a significant supply problem of softwood logs in China.
Before 2020, Chinese imports of softwood logs were mainly from New Zealand, Russia, Australia, Germany, the United States and Canada. Logs from the above six countries accounted for 79.7% of the total domestic imports of logs in 2019. In 2020, softwood logs from Germany have grown rapidly, with an increase of nearly 160% compared to 2019. The proportion of total log imports has also increased from 8.19% in 2019 to 21.29% in 2020, effectively filling Russia, the United States and Russia. There is a gap in Canadian log imports.
It is legitimate to think that China can replace the number of logs imported from Russia by increasing imports from New Zealand .In 2020, Russia exported more than 6 million cubic meters of logs to China. If supply ceases next year, can New Zealand really provide additional output in 2022? According to statistics from relevant agencies, New Zealand’s log felling is close to the peak of 36 million cubic meters, and the export volume is 50% or 18 million cubic meters, which is almost the limit of New Zealand log exports. It cannot completely replace the log import gap caused by the Russian ban.
As for Germany, another country with fast-growing log imports in China, imported logs reached 2.3027 million cubic meters in January-February 2021. In the most optimistic scenario, it is expected that nearly 4 million cubic meters of imported logs in China will be added for the whole year of 2021. However, the current price increase in the German log market is limited, and there have been voices calling for a cessation of logging and selling at low prices. Coupled with the previously adopted regulations on restricting deforestation in Germany, the restriction on deforestation in Germany, which is another variable in the imported timber market, is questionable whether German log imports in the second half of the year can maintain a high growth rate.
Even if Russia’s log export ban will not be implemented until 2022, in the most optimistic scenario, New Zealand and Germany can provide about 6 million cubic meters of increase in 2022, but there is still a gap of nearly 2 million cubic meters of softwood logs. And this is based on the premise that domestic timber demand will remain unchanged in 2022, so it is necessary to pay attention to the issue of log import gaps.
The post China will have a supply gap of almost 9 million m3 of logs by 2022 appeared first on Timber Industry News.