In the first week of March the CFR sale price for A grade radiata pine in China was in the low 100-104 USD per JASm3. Daily port off-take was still in the 35-50,000 m3 range.
In the following week sales were confirmed at the 105-109 USD mark. This defied economic sense as stock was still building to over 8 million m3, with significant volume also on vessels.
It appears the Chinese log buyers had noticed the reduced supply from both NZ and spruce from Europe. Indication of daily port off-take in China ranged from 80,000-100,000.
The daily port off take is now variable and dropping to 20,000 some days as log wholesalers are holding volume back to take advantage of higher prices as China log buyers react to reduced supply.
The supply of spruce from Europe has ceased as well due to the lack of containers. This combined with the reduction of logs from New Zealand will see the Chinese deplete their log inventory. This bodes well for demand of New Zealand logs when harvesting restrictions are lifted.
There is a shortage of demand for bulk vessels so the ocean freight rates have dropped considerably and there is a wide variation in the market. Shipping times have actually increased due to the slower discharge in China ports. There are also issues such as ex China vessels becoming quarantined, and specific personnel having to be dropped off at another port before reaching China to avoid quarantine.
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