Australia’s exports of hardwood chips exceeded 3.5 Mbdmt (bone dry metric tonnes) in calendar 2013, with just less than 1.3 Mbdmt exported in DQ’13 alone.
As our analysis of global wood chip shipping in December indicated, exports from Australia were expected to be close to 400 kbdmt for the month. In the end, they totaled 370.2 kbdmt.
If the export volumes experienced in DQ’13 continued across a full year, they would test the record 5.0 Mbdmt of exports experienced in calendar 2008.
While that may be a stretch, discussions with producers and buyers suggests exports above 4.0 Mbdmt is almost assured for calendar 2014.
Analysis of the movements of the global wood chip shipping fleet in January 2014 suggests hardwood volumes will be closer to 300 kbdmt for the month, with a lift typically expected for February as Asian production returns to full speed after the Christmas and New Year and Lunar New Year holiday periods.
Conditions in pulp markets may see larger volumes continue to be traded at the expense of price.
Demand for paper has been soft, especially in China, as it adapts to growth driven more by internal consumption. As a result, hardwood kraft pulp prices have moved sideways in recent months, with seemingly little room for woodchip prices to improve.
It may be that prices are right for sales of hardwood chips to be assured, but there are few on the supply side that consider the current prices are a true reflection of value.
This is an edited extract from Wood Market Edge, a summary of which is distributed free of charge. WME includes detailed charts, tables and prices of the major wood products traded in Australia.
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