Log exporter not panicking
Log exports to China have slowed over fears about the spread of the coronavirus, but a major player in the industry in South Canterbury says there is no need to hit the panic button.
Evan MacClure, a Timarubased director for exporters Forest Management (FM), said while it is not business as usual, exercising patience was the best way forward in a situation that has been doubly affected by the Chinese New Year.
‘‘It’s a period of uncertainty,’’ MacClure said, with FM exporting at least 600,000 tonnes of logs to China every year and about 140,000 tonnes of that going through the Timaru port.
‘‘I wouldn’t say we’re just rolling over and carrying on producing wood and not knowing what we’re selling it for. I’m saying it’s very difficult to talk to customers because it’s Chinese New Year, and there is not a lot of activity happening because of that.
‘‘While there’s a lot of panic about the coronavirus I think there’s definitely a change. I think the thing is not to panic and slowly take calculated steps and ask where to from here.’’
MacClure said the Chinese New Year period that runs until Saturday had created uncertainty in the middle of the virus outbreak as no workers were available to unload, process and cut up logs in China.
‘‘Construction isn’t occurring because it’s kind of like our
Christmas-break equivalent. I think we’ve got to put to put this into perspective.
‘‘All it really is is that inventory in China is high but not unusually high for this time of the year because it’s Chinese New Year and nobody is working, picking it up and taking it away.
‘‘But of course it (coronavirus) is having an effect on price, demand and construction but the full effect isn’t realised yet because, until we can start talking to customers again . . . we don’t really know how severe it actually is.’’
MacClure said his company will ‘‘wait for another week and see where things go from there’’.
‘‘Some companies have stopped exports until further notice, other companies have pushed on forward. I believe that ports in China are still receiving logs.
‘‘It is a big thing and there’s probably risks as to where the coronavirus might go, but there are more people recovering from the coronavirus than there are people dying from the coronavirus. It doesn’t mean to say that it is a good thing but that depends on how you look at all these facts.
‘‘The confining of 40 million people into Wuhan and some of the surrounding regions has meant it’s very difficult to get business going.
‘‘There may be some pricing correction like there is with all these other products going overseas like agricultural, dairy products, sheep and beef, seafood, flowers etc. All these industries are suffering at the moment and logging is just one of them.
‘‘Likewise the Chinese need to eat as well and that is quite important. They (China) need the business to keep the wheels turning just like we do.’’
‘‘. . . there are more people recovering from the coronavirus than there are people dying . . .’’ Evan MacClure