US Dollar Exchange Rates of
China Yuan 6.1539
Report from China
Benign inflation could lead to more fiscal stimulus
The latest statistics from China‟s National Bureau of
Statistics (NBS) showed that the consumer price index for
July was unchanged from 12 months ago at 2.3%.
With benign inflation analysts are expecting the
government to expand measures to support the economy
such as further tax cuts especially for small enterprises and
expanded public spending on infrastructure. Over the past
months consumers have eased up on utilising credit but
now the authorities are trying to stimulate credit growth.
The press release from the NBS says July‟s PMI was 51.7
percent, 0.7 percentage points higher than the previous
marking 5 consecutive months‟ of increase, welcome news
for the government.
In related news the July producer price index (PPI) fell 0.9
percent for the 29th consecutive month.
Timber strategic reserve plan finalised
In order to balance timber supply and demand and
guarantee national timber security China plans to
establish, by 2020, strategic commercial timber reserves
over 14 million hectares in 25 provinces including
Guangxi, Guangdong, Hu‟nan, Sichuan, Guizhou,
Yunnan, Inner Mongolia Autonomous Region, Liaoning,
Jilin and Heilongjiang.
Of the 14 million hectares, 4.5 million will be new
plantations, 5 million will be improvement of existing
mature forests and a further 4.5 million hectares will
require intensive management of young and maturing
forest. The aim is to create a base yielding an annual
average volume of around 142 million cubic metres.
According to the China National Timber Strategic Reserve
Production Base Plan (2013-2020), 1.87 million hectares
will be established in Guangxi Province to yield 13% of
the target production.
Standard on formaldehyde tightened
The China National Standards Administration will revise
the national standard on formaldehyde emission for
interior decoration and improvement materials which will
impact production of wood-based panels and other wood
products. The indications are that the E2 limit in the old
Standard will be eliminated.
Analysts point out that the new standard will have a big
impact on both flooring manufacturers and the producers
of adhesives. The elimination of the E2 standard will
increase the cost of flooring and wood product production.
Radiata log imports through Xiamen Port rise
According to Xiamen Customs in Fujian Province, log
imports through Xiamen Port rose 90% to 2.106 million
cubic metres in the first half of 2014.
The bulk of the logs entering the port were from New
Zealand (770,000 cu.m), Australia (409,000) and the US,
(326 000 cu.m).
Log imports from these three countries accounted for 45%
of all logs coming through Xiamen Port in the first half of
Radiata pine was the main species of imported logs and
imports of this timber increased almost 70% to 1.12
million cubic metres in the first half of 2014.
Redwood furniture prices climbing
According to the well-known domestic „redwood‟
furniture manufacturer, Liantianhong
(www.liantianhong.com/) current tariffs on redwood
furniture account for 20% of production costs.
Because of this prices for redwood furniture have risen by
between 5%-10% since the beginning of August but
producers are finding it difficult to trade at these new
higher prices as the buyers are resisting the increase.
Liantianhong says the redwood furniture market has
cooled and those with large stocks are under pressure to
dispose of the log stocks to avoid any further losses.
At present the redwood log market is weak and prices for
East African blackwood, African rosewood and Myanmar
padauk have fallen. However, prices for high quality
rosewoods are still firm.
In related news statistics from Guangxi Customs for the
first half show that imports of redwood logs and redwood
furniture by manufacturers in Pingxiang City were valued
at yuan 660 million, up by a factor of 5 year on year.
Major timber and furniture market in Urumqi City
The Xinjiang Production and Construction Corporations‟
Yanxin International Timber Furniture Market will be
opened in Urumqi City at a cost of yuan 4.2 billion. The
site covers some 187 hectares and will provide
employment for around 20,000. The market is scheduled
for completion in three years.