Based on analysis of shipping movements from Australian ports, IndustryEdge provides the following estimate of woodchip exports for June 2014.
Estimated Exports: 557,500 tonnes
Increase on May: 34.2%
If the estimate is confirmed by formal trade data (which will not be released until the first week in August), this will be the highest ever monthly exports of wood chips from Australia.
This data was first published in the subscriber only Wood Market Edge in late June, even before the final vessels had departed and at least six weeks before formal trade data is published. See below to find out how IndustryEdge does this.
In June, twenty separate woodchip vessels left Australia for the average 17 day trip to Japan or southern China. Several ports received four ships, but the prize belongs to Geelong, which received five ships, dispatching them all in the second half of the month.
With orders for 2H’14 reported to be under pressure due to demand softness in China, driven by languid demand for printing and writing papers, it would be tempting to consider these figures as evidence of continued market strength.
However, our long range tracking of the global woodchip shipping fleet shows only two ships specifically destined for Australia at 22nd June 2014. Expectations should be that exports will be significantly lower in July.
In May, total woodchip exports were 414.9 kt. Estimated exports, based on our unique Despatch to Shipment ratio, were just 0.9% higher than the final recorded volume.
The IndustryEdge Despatch to Shipment Ratio Method
IndustryEdge estimates and projections are based on unique analysis. The method involves calculating the gross vessel weights (Grt) of the ships that left Australia (in June).
Monthly aggregate Grt of departing ships has been divided by the Despatch to Shipment ratio.
The Despatch to Shipment Ratio currently stands at 59.2%. This ratio compares the Grt with the aggregate exports recorded by the ABS. The ratio currently has only ten months of observations on which to rely and declined 0.6% from the prior month.
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