Monthly Report - December 2025
The 2025 year draws to and end on a positive note for our domestic wood fibre market and a negative note for log exports.
A recent round of some sawmill owners was dominated by a cautious and positive response to the “how is the sawmilling business going” question. Fantastic to hear there has been a busy order book in recent weeks with good levels of enquiries for early 2026.
For those of failing or short memory or of recent entry to log sales from our forests, it is timely to remember how important the domestic log processing is to the NZ economy and for forest owners.
I call the sector log processing because domestic plants can include Sawmills, plywood plants and engineered product plants as well as MDF and woodchipping for fuel and on processing. For most forest owner domestic log processors represent resilient and stable pricing at reasonable levels.
A recent report from the Canterbury West Coast Wood Council reminds us there are over 42,000 NZers earning their daily crust in the commercial forestry Sector. Many of these are in domestic processing.
The report also confirms the sector remains the 3rd largest primary industry exporter basically on land farmers didn’t want or could not make enough money off. For those readers who have not done so already, I suggest you have a look at the Canterbury West Coast Wood Council web site, a lot of great information to be found and a great video on how we go about our business every day.
The news out of China and India is not so great but certainly not time to be thinking doom and gloom. China prices have come of US$4 -5 per m3 at the point of sale in December as customers seek to better alignment to China domestic prices.
In this case, non-alignment means there are no trader margins with demand across China generally week. The primary reason is diminished sales of manufacture and semi manufactured products domestically and to exports to the US. This means subdued trading and weak prices.
What is increasingly evident in China, the largest portion of NZ logs are being uses in mouldings and componentry, a trend that started in earnest 2 -3 years ago and continuing to gain momentum. This is great news in terms of awareness of the attributes of Radiata pine in finishing end uses.
Interestingly and going back to domestic processing, there is a current demand for good radiata logs to produce decking because Kwila is in short supply and there is a lot of decking in NZ. My China respondents also advise tropical hardwood logs are becoming increasingly difficult to source. Long may that continue.
Most commentators are suggesting no great change until post Chinese-New-year which is much later than normal on 17 February to 3 March 2026. The lateness of the celebration is potentially bad news for NZ with a burst of our Post Christmas holiday production being loaded on the vessels that will arrive in China when there are few people at work!
While sale prices have “come off the boil” shipping rates have also come down. A seasonal normality dovetailing to Northern Hemisphere trade as consumers hug fires to stay warm rather than getting out there to use wood and other commodities.
Diminished usage means less need of ships so there are more opening on NZ and suddenly charterers become the cat and the ship owners, the mouse. Shipping rates for a typical 2:1 voyage are in the low US$30 per m3, down $1 -2 on November
This is ensuring wharf gate prices are down NZ$1-3 per m3 at wharf gate which basically means we are business as usual for December.
India is displaying signs of weakness but for some different reasons. Demand is weak but daily usage is currently running at or about the rate of supply. Prices are holding steady, but there are some dark clouds on the horizon in the form of more vessels from NZ in January-February 2026. This is due to exporters looking for alternatives to China. You will not need an abacus to work out what is going to happen next.
To all readers I extend very Merry Christmas greetings and a Happy New Year
As always, please remember the thoroughly important message, it remains, as always, fundamentally important, the only way forward for climate, country and the planet, is to get out there and plant more trees”!
Allan Laurie.
Laurie Forestry.
