Chinese Log Imports Cool In First Quarter
China's upward trend in log imports came to a halt in late 2011, when construction activity slowed and inventories of logs and lumber at many Chinese ports reached very high levels, according to Wood Resources International. As a result of lower demand for wood products, softwood log import volumes during the first three months this year were down 11% from the same period last year. Log shipments from the two largest supplying countries, Russia and New Zealand, have declined by 16% and 17%, respectively, from a year ago. However, log exports from Western Canada to China were up 23% from the first quarter of 2011, and U.S. log shipments to China were 2% higher in the first quarter than in the year-ago period. North America's share of China's log market has increased from 5% in 2009 to 22% in 2011.
Interfor, West Fraser Report Q1 Losses
International Forest Products (Interfor) reported a net loss of $6.5 million or $0.12 per share in the first quarter of 2012. Included in the Company's results in the quarter was the effect of unrecognized tax assets of $1.8 million or $0.03 per share. Key factors impacting the Company's results in the first quarter were lower sales revenue, which fell $2 million or 1% vs the immediately preceding quarter, and higher log costs, particularly on the B.C. Coast.
West Fraser Timber Co. Ltd. reported a first-quarter loss of $C17 million, or 39 cents per share. That compares with first-quarter 2011 earnings of $C20 million, or 46 cents per share.
BC Laggard In Terms Of Forest Job Creation
BC has long been a laggard in terms of forest-sector job creation per unit of timber harvested. But over the past decade the situation has become much worse. Since 2001 there has been a 38 percent decline in the number of jobs created per thousand cubic meters of timber harvested.
In 2001, BC companies harvested 64.1 million cubic meters of timber, according to data from the Canadian Forest Service. That generated 88,300 direct jobs in timber harvesting and forestry (24,800), wood manufacturing (48,700) and pulp and paper (14,800), says BC Statistics. Combined, we got a ratio of 1.38 jobs per thousand cubic meters.
By 2011 however, the 63.1 million cubic meters harvested provincially generated only 53,000 jobs – 14,000 in timber harvesting and forestry, 30,100 in manufacturing and 9200 in pulp and paper. That combines for a ratio of just 0.84 jobs per thousand cubic meters, falling under one job per thousand cubic meters for the second year in a row.
"BC’s sharp decline in wood-manufacturing output means that we are creating far fewer jobs from the province’s resources," notes Brother Kim Pollock, USW researcher in the District 3 office.