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MARKET BEATS 11
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World Resources Institute

forestry industry. The main piece of good news for harvesters market as harvesting will be slowed by the terrain (usually
has been the minor increase in CFR prices in China. steep) and the limited capacity of the local port.
While any movement in this section of the market is Otherwise, local timber markets have remained sluggish

expected to be small in the short term, due to seasonally outside of parts of the South Island (i.e. Otago), where
weaker construction and an increase in port-level inventories, construction is robust.
the longer-term outlook is relatively positive. The Government has just released a document listing
The above has been helped by the expectation that the numerous overseas building products that will now be
United States will soon extend the 90-day truce on additional approved for use within New Zealand, based on other overseas
tariffs while they continue to negotiate with China on a more government certification criteria. It is expected that this will
permanent arrangement. reduce the cost of housing construction.
A steady, moderate level of log sales are continuing to be House construction costs have lifted substantially in New
made into India, where the market has been similar to China Zealand since the pandemic, quoted as up 25-46 percent

after accounting for extra shipping costs. A second round since Q1 2020 for a standard single-story home, depending
of NZ-India FTA talks ended recently, with another round on the source.
scheduled for September. The secondary carbon market has been on a slow
Locally, the main talking point has been the consistently downward trend this month, following the brief lift after last
wet conditions through the recent month. month’s quarterly carbon auction.
The Nelson/Tasman region was hit especially hard, with an Spot prices at the time of writing were $56/NZU. The
estimated 4000 ha of forest affected by a windthrow event. public consultation period for Emissions Trading Scheme

Although this is of significant scale, supplies from the (ETS) settings closed late last month, and the final decisions
salvage effort aren’t expected to have a large impact on the will be announced in late September.