New Zealand: Chinese log market under downward pressure

Summary

In February 2025, China imported 1.3 million cubic metres of New Zealand logs, up 21% year-on-year;

cumulative imports for January-February totalled 2.42 million cubic metres, down 8% year-on-year. Among them, radiata pine log imports reached 2.28 million cubic metres,

down 8% year-on-year, with import value of US$280 million, down 11% year-on-year;

imports of radiata pine with cross-section ≥15cm totalled 2.26 million cubic metres, average price US$123 per cubic metre, down 3% year-on-year. Eucalyptus log imports halved year-on-year,

dropping 51%; Douglas fir log imports rose 24%.

Commentary

New Zealand accounts for about 40% of China's total log imports, with radiata pine dominating the mix. The double decline in export volume and price to China at the start of 2025 directly reflects the weakness in China's building materials market—real estate development investment contracted by over 10% in 2024, suppressing demand for structural timber. For small forest owners, an average price of US$123 per cubic metre is close to the cash cost line in some regions; with NZ dollar exchange rate fluctuations, actual returns may be even lower.

However, the market is not all negative: Douglas fir imports increased by 24%, indicating that niche demand for high-end furniture and landscaping remains resilient; the halving of eucalyptus imports highlights increased competition from alternative hardwood materials, with South American eucalyptus priced lower. In terms of industry trends, China is promoting green building materials and prefabricated construction, which may open up space for engineered wood products in the long term, but in the short term radiata pine inventories remain high (China's port stocks exceed 3 million cubic metres), and price recovery will depend on the concentrated start of infrastructure projects in the second quarter. Exporters should watch for replacement demand arising from the degradation of China's 'Three-North' shelterbelt forest, while accelerating market diversification into Southeast Asia, India and other emerging markets to reduce single-market risk.

Lower shipping costs and the zero tariff under the NZ-China FTA are current buffers, but if China's construction activity fails to rebound as expected in the second half, radiata pine prices may continue to grind lower.

Keywords: New Zealand logs, Chinese imports, radiata pine, eucalyptus, Douglas fir, downward pressure, customs data, import volume, price decline

Source: Zhihu