Log Weekly: Volatile Arrivals, Subdued Demand

Summary

Sohu Hongye Futures' log weekly report, released on 21 October 2026, shows spot prices for 3.9m medium-A radiata pine logs at Rizhao Port at RMB830/cubic metre, up from the previous period, while 4m medium-A radiata pine logs at Taicang Port were RMB820/cubic metre, down slightly. On the futures side, the benchmark log contract 2611 closed at RMB816.5/cubic metre on 21 October, down from the previous period, with the overall market range-bound and spot prices diverging by region. In the overseas market, according to Woodlink statistics, as of 12 October 2026, October CFR quotes for New Zealand radiata pine logs ranged from USD132-137/JAS cubic metre, with the low end up USD4/JAS cubic metre from the previous month and the high end up USD3/JAS cubic metre; overseas prices have now been raised for three consecutive rounds, but the spot market has been slow to follow.

For early November 2026, bulk freight rates for New Zealand-to-China imported softwood logs were USD46/JAS cubic metre, flat month-on-month from late October. On arrivals, 13 ports are expected to receive 9 New Zealand softwood log vessels in the week of 19-25 October 2026, down 2 vessels or 18% week-on-week, with total arrivals of about 346,000 cubic metres, down 39,000 cubic metres or 10% week-on-week. In the previous week (12-18 October 2026), actual arrivals were 11 vessels, up 1 vessel or 10% week-on-week, with total arrivals of about 385,000 cubic metres, up 20,000 cubic metres or 5% week-on-week.

Recent arrivals have shown a regional split of more in the south and fewer in the north. On imports, China imported 4.803 million cubic metres of logs and sawn timber in September 2026, with cumulative imports of 40.434 million cubic metres in January-September, down 4.1% year-on-year. China's total softwood log imports in September were about 2.216 million cubic metres, up 11% year-on-year, with cumulative imports of about 17.94 million cubic metres in January-September, down 0.4% year-on-year.

The report noted that September softwood log imports rose markedly year-on-year, New Zealand's dominant position in the import mix continued to strengthen, and import sources became further concentrated in New Zealand.

Commentary

Overseas quotes for New Zealand radiata pine logs have been raised for three consecutive rounds, with the October CFR range rising to USD132-137/JAS cubic metre, yet China's spot market has been slow to follow, with prices at Rizhao Port and Taicang Port diverging and the benchmark futures contract range-bound and drifting lower. The divergence reflects a tug-of-war between weak Chinese log demand and rising supply-side costs. As the largest export market for New Zealand logs, China accounts for more than 70% of New Zealand's total log exports, and its import mix has become further concentrated in New Zealand.

Softwood log imports rose 11% year-on-year in September, but cumulative imports for January-September were still down 0.4%, indicating that demand recovery is not yet solid. For NZ SMEs, higher overseas quotes and flat freight rates mean rising landed costs, while spot prices at Chinese ports have failed to rise in tandem, squeezing margins. At the same time, the regional split in arrivals, with more in the south and fewer in the north, suggests relatively active processing demand in southern China, while the north is weighed down by the property downturn.

New Zealand small and medium-sized forest owners and exporters need to watch Chinese log futures price signals, adjust shipping schedules flexibly and avoid concentrating arrivals, which could aggravate price volatility. In addition, the concentration of China's softwood log import sources in New Zealand, while strengthening New Zealand's market position, also increases the risk of dependence on a single market. Companies could consider developing alternative markets such as India and Southeast Asia, or locking in forward prices through hedging.

Keywords: log futures, radiata pine logs, New Zealand softwood logs, arrivals, overseas quotes, softwood log imports, Rizhao Port, Taicang Port, freight rates

Source: Sina.com