Timber Tumble: China’s Softwood Log Imports Plummet, Sending Prices Spiraling Down

"Chinese Sawmills Prepare for Lunar New Year as Softwood Log Off-Take Declines"

China’s softwood log inventory remains stable, but there has been a decrease in daily port off-take as preparations for the Chinese Lunar New Year begin. Currently, the daily offtake stands at around 55,000 cubic meters per day. This year, many sawmills in China are opting for a longer break than usual.

In January, the sale price for A grade pine logs in China remained steady, ranging between $127 and $130 USD. However, some log exporters have expressed their intentions to increase prices for February sales.

By the end of December, wholesale log prices in China had dropped by approximately 60 RMB per cubic meter, which accounts for a 6% decrease from the peak levels seen when sawmillers were actively buying logs.

The reduction in daily port off-take can be attributed to the upcoming Chinese Lunar New Year celebrations. This annual festival, also known as Spring Festival, is a time when many businesses and factories in China shut down for several days, allowing employees to spend time with their families and celebrate the new year.

The longer break taken by sawmills this year is likely a result of the ongoing COVID-19 pandemic. As the virus continues to pose a threat, businesses are being cautious and taking additional measures to ensure the safety of their workers.

Despite the stable inventory and prices, some log exporters are seeking price increases for February sales. This could be due to various factors, including rising production costs or increased demand for softwood logs in China.

It is worth noting that the softwood log market in China is influenced by a range of factors, including government policies, economic conditions, and global trade dynamics. These factors can lead to fluctuations in prices and demand, making it important for log exporters to closely monitor market conditions and adjust their strategies accordingly.

As the Chinese Lunar New Year approaches, it is expected that daily port off-take will continue to decrease. However, once the celebrations are over and businesses resume their operations, the demand for softwood logs is likely to pick up again. It will be interesting to see how the market evolves in the coming months and whether the price increases sought by some log exporters will be accepted by buyers in China.

In conclusion, while China’s softwood log inventory remains stable, the daily port off-take has started to reduce in preparation for the Chinese Lunar New Year. The sale price for A grade pine logs in China remained stable in January, but some log exporters are looking to increase prices for February sales. The longer break taken by sawmills this year and the ongoing COVID-19 pandemic are factors that may be influencing market dynamics. It will be important for log exporters to closely monitor market conditions and adjust their strategies accordingly.

John O Mahony

John O Mahony

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