Inventory drawdown masks subdued demand as log prices stall

Summary

Nanhua Futures has released an analysis of the log market. According to Muliang research, as of 9 October 2026, the CFR offer range for October New Zealand radiata pine logs was USD 132-137 per JAS cubic metre, with the low end up USD 4 per JAS cubic metre and the high end up USD 3 per JAS cubic metre from the previous month. Supply edged lower: from 19 to 25 October, 13 ports expected 9 New Zealand coniferous log vessels, down 2 from the previous week, a week-on-week decline of 18%; total arrivals were about 346,000 cubic metres, down 39,000 cubic metres from the previous week, a week-on-week decline of 10%.

Demand improved relatively but remained generally subdued: from 12 to 18 October, average daily outbound volume of coniferous logs at 13 ports across 7 Chinese provinces was 69,500 cubic metres, up 15.64% from the previous week. Continued inventory drawdown provided some support: as of 16 October, radiata pine log inventory stood at 1.70 million cubic metres, down 80,000 cubic metres; total coniferous log inventory was 2.34 million cubic metres, down 40,000 cubic metres. On imports, China's total coniferous log imports in September 2026 were about 2.216 million cubic metres, up 11% year on year; the January-September cumulative total was about 17.94 million cubic metres, down 0.4% year on year.

Total coniferous sawn timber imports in September were about 1.147 million cubic metres, with the January-September cumulative total at about 9.354 million cubic metres. In early November 2026, the ocean freight rate for bulk carriers carrying coniferous logs from New Zealand to China was USD 46 per JAS cubic metre, flat month on month. The report concludes that demand is generally subdued and the market lacks upward momentum, with range-bound, softer trading expected to persist.

Commentary

Export prices for New Zealand radiata pine logs to China have edged higher, but subdued demand and inventory drawdown leave the market without clear direction. As the largest buyer of New Zealand logs, China's market fluctuations directly affect local forestry exporters. China's total coniferous log imports are slightly down year on year, but September alone rose 11%, indicating short-term restocking demand.

However, although average daily outbound volume improved week on week, it remains below the same period in previous years, reflecting a weak recovery in downstream construction and furniture sectors. For NZ SMEs, the key is to watch the effects of China's property policy stimulus and the substitution trend toward sawn timber—cumulative sawn timber imports are growing and may squeeze the log share. Flat ocean freight costs provide some stability, but price upside is capped by demand.

Exporters are advised to adjust supply pacing flexibly and explore niche demand for radiata pine in industrial applications such as packaging and pallets to hedge against weakness in the construction market.

Keywords: New Zealand radiata pine logs, log inventory drawdown, coniferous log imports, CFR offers, average daily outbound volume, ocean freight, subdued demand, range-bound and softer

Source: Sina Finance