Page 10 - FDMAsia MayJun 2025

8 MARKET BEATS MAY/JUN 2025 FDM ASIA | www.fdmasia.com

percent in the first seven months of 2024. initially went to Japan and Korea who completed the same
October data in 2024 showed an improvement in housing cycle of demand to build infrastructure.
sentiment. However, the overall picture remains “challenging” “Then China came in overnight,” he said. “They could do
with both investment in real estate and the number of new what no others could in terms of scale.”
builds dropping by their fastest rate in October year-on-year. Tombleson said predictions of a downturn in log exports
The MFAT report said structural change in the property to China in the next decade “came forward”.
sector had weakened economic activity in related sectors of On a brighter note, Tombleson said there's increasing
construction and furniture-making, both of which import New demand from companies in its move away from fossil fuels
Zealand logs and wood products. to wood pellets and wood chips to power boilers.

“This impacts demand and global prices for New Zealand He said regrettably the increasing demand for biofuels will
logs.” not be a substitute for the high prices paid by China that are
MFAT said China’s total imports of logs had fallen 36 required to make forestry profitable, particularly for more than
percent from 2021-2023 (NZ$16.4 billion to NZ$10.3 billion). 4,000 smaller forest owners being mainly farmers.
The current property slump had been a “hard market A frequent visitor to China for his Rotorua-based business,
demand correction”, meaning that while demand for logs Neilson said he did not predict the severity of the downturn
would eventually stabilise, it's likely to do so at a level lower in the log trade there.

than the heights of 2020-2021. “It’s likely to be subdued for several years before it comes
Tombleson said a bulk of New Zealand’s log exports back.”