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China Wood Products Prices

16 – 29th February  2020

US Dollar Exchange Rates of  26th  February 2020
China Yuan 7.0046

 Report from China 

 New Forest Law to crack down on illegal timber
The new forest law will become effective on 1 July 2020.
Article 65 of the newly revised Forest Law clearly states
that a timber processing enterprise shall establish an entry
and storage account for raw materials and products. No
unit or individual may purchase, process or transport trees
of illicit origin, knowing that they have been cut or cut

This provision provides a more clear legal basis to crack
down on illegal timber purchasing, processing and
transportation and also provides a clearer legal guide for
timber processing enterprises to fulfill their duty of due
diligence on timber legality.


Domestic timber wholesale markets resume business
It has been reported that timber from South America and
Southeast Asia recently arrived in Guangzhou and
Dongguan Ports and has been off-loaded. The domestic
timber wholesale markets have started work after the lull
due to the virus risk. The trade media (Wood365) has
reported that small volumes of timber have been delivered
to the wholesale markets after passing virus epidemic
prevention and control measures.

However, traders report activity at the markets is very
quiet and sales have not returned to normal as many
manufacturers have not resumed production despite the
arrivals of timber raw materials. Analysts say they do not
expect a recovery of trading until the end of March.

Enterprises resume production in China
Preventative measures including restricted access, body
temperature checks and disinfection of public areas have
undertaken. Large gatherings are avoided and workers
have been advised to wash their hands frequently and wear
a mask when away from home. Some businesses,
especially foreign-funded enterprises resumed operations
in China while strengthening epidemic prevention and
control measures.

It has been also reported that some wood products
enterprises have resumed production .


Reduced particleboard production in Guangdong
It has been reported that the production of wood-based
panels in Guangdong Province fell in 2019 with
production of particleboard dropping around 10%. The
main reason for the decline is said to be because some
large scale enterprises have stopped operations.

Several fibreboard enterprises in the Guangdong Shaoguan
Forest Region have ceased production. It has been
reported that Guangdong Hanhong Wood Industry Co.,
Ltd which has two German fibreboard lines with an
annual capacity of 240, 000 cubic metres has cut
production due to weak demand.

Measures to support the economy
It has been reported that the State Council decided to
waive the tolls on toll roads throughout the country until
the virus epidemic is brought under control. Other
measures being arranged are reductions in corporate social
insurance and an extended period for paying housing
provident fund.

These measures are aimed at ensuring continued
agriculture production and to secure stable employment.

In order to mitigate the impact of the epidemic on
enterprises during the time plants are closed medium,
small and mini-sized enterprises in all provinces except
Hubei will be exempted from corporate taxt,
unemployment and employment injury insurances and
housing provident fund payments up until June 2020.
Different measures are proposed for large enterprises.


Big rise in logistics costs
Wood365 has reported that the China Logistics and
Purchasing Federation (CLPF) found that 85% of
enterprises report the epidemic is having a huge impact on
their operations and some risk bankruptcy. Many
enterprises considered starting operations after the 10
February deadline but most did not resume work.

Transport and freight rates have started to rise apparently
the result of the current epidemic. In a survey the CLPF
found 70% of companies thought transport costs would
increase by more than 10%, but around 40% said they
would rise by more than 20%. Some even suggested a
30% rise.


Lanzhou City ¨C the logistics centre for Russian timber
It has been reported that Russian timber will be distributed
to all parts of the country after arriving via the China-
Europe express railway terminal in Lanzhou City, Gansu
Province. This, say analysts, will promote the wood
processing industry and strengthen the supply chain for
imported timber the Western Region.

The Lanzhou New Industrial Zone is a major logistics
centre for Russian timber and it is anticipated the Zone
will attract investment in processing thus establishing a
new industrial cluster.

Imported C&F price data series
In an effort to provide more transparency on imported
timber prices in China a data set is provided below
showing average prices for some key timbers imported.

It should be noted that these average C&F prices are
derived from the import volumes and values as reported by
China¡¯s Customs.

We apologise for not being able to up-date the average
prices, China Customs is operating with a skeleton staff
due to the virus outbreak.


LM        Loyale Merchant, a grade of log parcel  Cu.m         Cubic Metre
QS         Qualite Superieure    Koku         0.278 Cu.m or 120BF
CI          Choix Industriel                                                       FFR            French Franc
CE         Choix Economique                                                        SQ              Sawmill Quality
CS         Choix Supplimentaire      SSQ            Select Sawmill Quality
FOB      Free-on-Board     FAS            Sawnwood Grade First and
KD        Kiln Dry                               Second 
AD        Air Dry        WBP           Water and Boil Proof
Boule    A Log Sawn Through and Through MR              Moisture Resistant
              the boards from one log are bundled                      pc         per piece      
              together                      ea                each      
BB/CC  Grade B faced and Grade C backed MBF           1000 Board Feet          
              Plywood   MDF           Medium Density Fibreboard
BF         Board Foot F.CFA         CFA Franc        
Sq.Ft     Square Foot               Price has moved up or down

Source:ITTO'  Tropical Timber Market Report

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