Log inventory in China has increased about 300k m3 in the last month to around 4.6m m3, with congestion now only at the one area in Lan Shan where there is a 12-14 days delay in ship unloading. While this level of log stock is higher than usual at this time of the year, an increase of 300k m3 was not unexpected as China went through Chinese National Day Holiday week in the first week of October.
According to a scoop.nz report, daily log use in China is now reported at 100k to 105k m3 which has increased by 20k m3 from last month. The expected busy construction season is happening. There are differing views on how long this activity will last.
The CAIXIN manufacturing PMI index moved down slightly in September from 53.1 to 53.0. This shows the sector remains healthy. (A PMI above 50 indicates expansion and the August number of 53.1 was the highest since January 2011).
The weakness of the furniture markets (both China’s domestic and export markets) has contributed to the rapid shrinking of the medium density fibreboard (MDF) market, scoop.nz reports. China exports of furniture products fell 24% to US$ 7.4 bln in the first half of 2020. A rise in customised home furnishings in China has also led to the rapid development of the particle board market (low density fibreboard), at the expense of MDF.
Overall, China imports of fibreboard were down 26% in the first half of 2020. China exports of fibreboard was down 21% in the first half of 2020. This trade was affected by Covid-19 issues affecting both supply and demand. China’s imports of particleboard were up 15%, and exports were down by only 1%, despite the Covid-19 impact on trade, scoop.nz reported.
There are currently 32 fibreboard production lines under construction in China with a total output capacity of 6.51 million m3 per year. The fibreboard production lines under construction will come on-line over the next two years. This will lift the total annual fibreboard production capacity in China to 56 million m3, scoop.nz reports.
Recently, the Guangxi Lelin Group and Dieffenbacher concluded a deal for a 600,000 m3 per annum formaldehyde-free fibreboard project. This, the Group claims, will be the largest single-line production plant in the world. The continuous press is 2.7m wide and 80 m long.
Five new particleboard production mills with an annual output of 1 million m3 have recently become operational in Shandong, Jiangsu, Anhui and Guangxi Provinces of which four are continuous flat pressing lines with annual output capacity of 950,000 m3. 25 particleboard production lines were under construction in China in the first half of 2020 with annual output of 6.96 million m3.
The post Strong demand for logs in China due to busy construction season appeared first on Timber Industry News.