Sammlung von Newsfeeds

The Albanese Government has introduced amendments in Parliament to strengthen laws stopping illegally logged timber from entering the Australian market. Source: Timberbiz Greater investment in timber testing technology, increased enforcement, expanded monitoring and investigation powers, as well as naming and shaming those who break the rules are all measures included in the new Bill. It is estimated that up to 10% of Australia’s annual timber and wood-based imports may be illegally logged and the trade in illegal imports reduces price of legal timber globally by 7-16%. Measures in the Bill will modernise and strengthen the Act, to better protect the Australian market from illegally harvested timber and timber products and support sustainable and legal timber trade into the future. Together, these amendments to the laws will help make Australia an even less attractive destination for illegally sourced timber and further protect Australia’s reputation in international markets as a supplier of sustainable and legally sourced timber products. This Bill will both uphold our reputation as a global leader through adopting further best-practice regulatory approaches, and help address the environmental, social, and economic harms of illegal logging and associated trade. Minister for Agriculture, Fisheries and Forestry, Murray Watt said the Illegal Logging Prohibition Amendment (Strengthening Measures to Prevent Illegal Timber Trade) Bill 2023 (the Bill) would modernise and strengthen current laws if it successfully passed through Parliament. “Australia’s illegal logging laws support a sustainable forestry industry and reduce the risk of it being undercut by illegal products.” Minister Watt said. “Australia was among the first country in the world to introduce laws targeting illegal timber and trade in 2012. “Our laws restrict the import and sale of illegally logged timber and timber products, and processing of domestically grown raw logs that have been illegally harvested. “Reforms will enable use of new innovations including cutting-edge timber identification technologies, to strengthen our ability to identify and act against those who jeopardise Australia’s legal and sustainable timber trade. “We know that Australian timber producers and environmental groups alike want to see these tools and techniques used effectively in Australia.” Minister Watt said illegal logging was a complex global problem, with significant impacts for Australia’s forest industries. “Illegal logging has devastating impacts on climate, nature, and people, and costs developing countries billions of dollars in lost revenue every year,” he said. “Australia is not immune, with trade in low-priced illegally sourced timber undermining supply chains, business decisions, industry profitability, investment, and jobs in the Australian economy. “Modernising Australia’s laws will help make Australia an even less attractive destination for illegally sourced timber and further protect our international reputation as a supplier of sustainable and legally sourced timber. “The Bill will allow us to continue to lead global efforts to combat illegal logging now and into the future.”

History is a great predictor of the future, and the log market is no different. March export prices have been released and it feels as though we’re trying to climb a barbed wire fence, but the problem is we’re currently stuck with one leg on either side, our crotch is snagged on a barb and our feet are slipping. We’re starting to feel some pain and we’re not sure how much more we’ll have to endure before our feet find firm ground. March prices have dropped around $10/M3 from February and while a drop was not entirely unexpected, the quantum is a pain point. There’s three key metrics that determine export log prices, CFR price (sales price in $USD in the export market), shipping costs and foreign exchange, and unfortunately all three are causing our feet to slip this month. It’s not unusual for CFR price to drop post Chinese New Year (CNY) holidays as the Chinese populous slowly return to work from the longest break of the year and take a while to crank the various industries back into life. Post-holiday demand has been very weak and, with NZ and other countries continuing to supply over the holiday period, inventories have increased around 1Mm3 to around 4Mm3. While historically this figure is at the lower end of the total inventory position scale post CNY, with consistently lower log demand now a new norm, 4Mm3 still represents around 65 days inventory which is similar to previous years’ when demand was significantly higher. Foreign exchange jumped a cent early in the month following the Reserve Bank Governors’ comments and a generally weaker greenback. Freight has caused our feet to slide the most with the Suez Canal scuffle increasing the bulk vessel demand in the Atlantic and resulting in a shortage of vessels in the Pacific. This has resulted in vessel costs increases of around $US8/m3 over the past 6 weeks and unfortunately, like Adrian Orr, these shipping issues are problematic and likely to be around for a while. The general outlook for China hasn’t really changed with the property market in its third year of downturn. The country’s leaders have just finished their week-long national congress with pledges to boost employment and stabilize the property market, which has historically made up around a quarter of the economy. However, much like Chloes’ recent post promotion speech, the CCP pledges are long on rhetoric and short on practical and workable solutions. There’s no hiding the demographical issues China is facing with a reducing and aging population which will struggle to fill the availability of new homes currently on the market. The IMF recently released their projections of a 45% fall in housing investment based on 2021 figures and asserted that ‘an accelerated cleanup of distressed developers and other policies will help smooth the path to a smaller, more sustainable role for real estate in the economy’. There’s no denying the need for a reduction in NZ supply to match the new level of demand in China and this is happening slowly. Volume from our cousins over the ditch has resumed into China, albeit at a low but not insignificant level, and supply from other countries has reduced to a trickle due to a myriad of issues. We have seen a couple of vessel head to India from NZ in recent months, but this isn’t a silver bullet – yet. NZ supply will seasonally start reducing as it gets wet and depending on how far into the undies the barb penetrates, the private sector supply will react accordingly. Longer-term fixed price contracts are becoming an important tool for forest managers to help de-risk the export returns for clients and provide exporters with some committed volume over the medium term with which they can plan sales and shipping rotations. Carbon continues to trade under $70/NZU with a slight rebound since the government recently announced it has changed its methodology around the calculation of the reserve price for future NZU auctions. Prior to this there had been a decline with a five-month low in early February with commentators noting a selloff likely attributed to an attempt to limit the auction reserve price. Following the changes to the National Environmental Standards for Commercial Forestry (NESCF) as a result of Gabrielle, new rules round slash management have been legislated with the requirement to remove slash over 2 meters in length and 10cm in diameter on orange and red zoned land (a large chuck of the NZ forest estate). In addition, there cannot be any more than 15m3/ha remaining in the cutover. This has created a fair degree of handwringing amongst councils and forest managers as to how to actually comply with this and how to monitor compliance. The implementation of this legislation nationally, rather than regionally, is a knee jerk reaction to the issues that doesn’t recognize the majority of the woody debris mobilized in cyclone affected regions were actually standing forests that were washed into waterways as the very unstable hillsides failed, rather than slash mobilized from the cutover. It’s going to be a very hard and costly piece of legislation to comply with, especially with the current level of mechanization which is not designed to deal with very small pieces of wood. So, it looks likely that the next few months may be a bit sticky in terms of prices. Domestic demand will keep the tiller steady, especially for pruned forests, but it may take a while to gain some solid footing on the export front. All going well, we’ll hopefully be able to replace our torn undies later in quarter 2. Marcus Musson is a Forest360 Director. He holds a Bachelor of Forest Science with Honours from Canterbury University, New Zealand, and specialises in steep slope cable harvesting, marketing and value recovery initiatives.

The expansion of one of the Clarence Valley’s largest timber factories, Big River Group, is a huge boost to the local economy and sets the bar high in supplying the sustainable manufacturing of high-quality specialist technical timber products across New South Wales. Source: Timberbiz The upgrade includes the installation of state-of-the-art machinery that will substantially increase Big River’s output, enabling them to supply an unprecedented volume of timber products. New South Wales State Nationals Member for Clarence, Richie Williamson, and Federal Nationals Member for Page, Kevin Hogan, were onsite for the official opening of the $22 million upgrade. The upgrade was supported with $10 million in co-funding from the former NSW and Federal Nationals Governments under the Bushfire Local Economic Recovery Fund to help consolidate the company’s operations. Mr Williamson said Big River Group has been part of the local landscape since the 1960s and has grown into a multi-million-dollar business that is renowned for its high-quality product and for being one of the Clarence Valley’s major industry employers. “Following the Black Summer bushfires in 2019, the long-term supply of logs for its operations was severely impacted and it became apparent there was insufficient log resources in the Tumut region to sustain the Wagga Wagga facility,” Mr Williamson said. “Big River Group made a business decision to consolidate its operations to a single site at Grafton, where a sustainable supply of both hardwood and softwood logs exist. “While this was a difficult decision for the company, it’s a positive outcome for our community and comes at a critical time after back-to-back challenges.” Mr Williamson said it was important to back projects that put people back in work, retain existing jobs and stimulate local economies, as well as deliver high-quality timber products to the construction industry well into the future. Mr Hogan said the $22 million project will increase the local workforce to 75, securing the jobs of existing employees and its 610 employees nationally. “I am focused on backing projects that are creating and retaining jobs across our region,” Mr Hogan said. “This project will enhance the production capacity for all plywood products, including high quality formply products, architectural panels and high strength plywood for civil construction.” Big River Group CEO, John Lorente, said the upgrade signifies not just an expansion of their operational capacity, but a commitment to innovation, sustainability, and the future of a timber industry in NSW. “With the support of the Forestry Recovery Development Fund Program, we are poised to make a significant impact on the availability of high-quality timber products, while also securing and creating jobs locally, regionally and nationally,” Mr Lorente said. “We are thankful for the support provided by both the Australian and NSW Governments through the Bushfire Local Economic Recovery Fund. The funding provided has been crucial in allowing us to modernise our operations and expand our team.”