As late as 2019, China imported almost 100 million m3 roundwood equivalents of softwood logs and lumber to meet the growing demand for forest products in the domestic market.
Since then, wood consumption has declined, and the importation of forest products has decreased to levels not seen in over a decade.
Wood Resources International reports that China imported about 12 million m3 of logs and lumber in Q1 2023, nearly half its peak in the Q3 2020 and the second lowest quarterly imports in 10 years.
According to the World Bank, China’s economy took a big hit during COVID-19, with the GDP growth falling to an estimated 3% in 2022, compared to a 9% average annual increase from 1978-2021. It is estimated that the economy will see a rebound to just over 5% growth in 2023.
China’s dramatic reduction in log imports has predominantly been driven by the lack of supply from Russia following the country’s implementation of a log export ban in January 2022.
Russia was the largest log supplier to China until 2012 when New Zealand surpassed it. Since then, Russia’s shipments have fallen consistently and were down to zero in 2022.
With log supply from Russia, Australia, Canada, and the US plunging over the past five years, New Zealand and Europe have become the two major regions supplying China (Table 1).
During the first four months of 2023, New Zealand’s market share of China’s total log imports was 58%, followed by Germany with 14%, Poland with 5%, the US with 5%, Canada with 4%, and Japan with 4%.
The outlook is for declining shipments from North America and Europe, eventually leaving New Zealand as the only remaining major log supplier.
Wood Resource Quarterly believes that China will consequently need to explore opportunities to increase lumber imports rather than logs to meet future wood demand.
Source: Wood Resource Quarterly