China:Wood-Based Panel Markets
¡¾2002.12.06¡¿

According to recent statistics, China produced 21.1 million cubic metres of various wood-based panels in 2001, a level second only to the US production. Wood-based panel imports came to 1.9 million cubic metres while exports were 1.1 million cubic metres. The negative balance of trade was 802,300 cubic metres.

However, there is a big difference in the trade depending on the various wood-based panels. Plywood exports amounted to 965,400 cubic metres or 89.4% of China's total wood-based panel exports in 2001. Exports of other wood-based panels were only 114,100 cubic metres, including: 62,300 cubic metres of veneer, 26,800 cubic metres of fiberboard and 25,000 cubic metres of particleboard. This illustrates the substantial increase in plywood exports.

China imported 1.9 million cubic metres of various wood-based panels in 2001, of which plywood, was 650,900 cubic metres veneer 335 700 cubic metres and particleboard 447 600 cubic metres. The statistics show that the increasing proportion of fiberboard and particleboard imports was the main reason for unfavorable balance trade of wood-based panel.

Although veneer imports had appeared to be declining in recent years they still topped 335,700 cubic metres in 2001, accounting for 17.8% of the total wood-based panel imports.

According to local analysts, one of the main reasons for the continued increase in particleboard imports was the rapidly growing demand for composite flooring material in the domestic markets in recent years.

Demand in Northeast China

The markets for timber from state-owned forest region in the Northeast China have developed strongly over the past few years and especially during this year. The growing demand for timber has caused timber prices to rise.

State-owned forest in the Northeast China are found in four regions: Heilongjiang Province, Daxing'anling, Jilin Province and Inner Mongolia Autonomous Region. These forests produce timbers used traditionally in construction Korean pine, White pine and Larch. Also produced are hardwoods such as Chinese ash, oak, linden, elm and birch, which are used mainly in furniture making and for interior joinery.

Before the recent improvements in demand the timber market in Northeast China had been in a depressed state. In addition, because the economy in the region did not do well under the planned economic system the sector did not develop. In the past timber production was low, and the products had a reputation for being of poor quality and sales were difficult and prices were low. Local analysts point out that in these areas change was slow and the economy could not adapt to the new market economy. Apparently this situation lasted by the end of last year but finally the sector has evolved and the timber market appears able to continue to grow.

Overall, analysts say that now the timber market in the Northeast China works smoothly, especially the hardwood market. The demand for Chinese ash and other hardwoods has been soaring and prices are very high and firm. The price of Chinese ash (length 4 metre, diameter 30-38 centimeter) is at yuan 1500 per cubic metre. High-quality fresh cut coniferous timbers are also selling well, especially medium and small diameter timber. However the demand for large diameter logs is reportedly not as good as for smaller logs because of the high prices being asked.

Log Imports through Dalian

According to statistics from Dalian's Custom, in the first three quarters of 2002 imported logs through Dalian's port totaled 829 000 cubic metres, valued at US$46.62 million, a huge increase on 2001 imports.

Log imports through Dalian's port are mostly from Russia, accounting for 98.2% of the total. There were no imported timbers from New Zealand reported last year whereas 41,000 cubic metres of logs from New Zealand were imported this year.

Japan's Plywood Imported from China

The Japan's plywood imports from China have increased considerably this year according to relevant trade statistics. From January to August Japan's imports were more than twice that of the same period last year.

According to Japanese importers, the fact that Chinese enterprises have introduced modern production equipment and technology means that the plywood manufactured in China meets Japanese requirements in term of quality. The added advantage is that Chinese plywood is priced lower than plywood from Indonesia, for example, and is also lower than domestically manufactured plywood. Under these conditions more and more Japanese users are beginning to use plywood made in China.

At the moment most of the plywood made in China has core veneers of poplar and this limits the use of the panels to the packaging industry and is not suitable to be used as structural panels. Analysts are suggesting that Chinese plywood made using coniferous timber imported from Russia would sell well in Japan.