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Friday Offcuts – 26 May 2006

growing trees cutting and milling timber forest products
Good morning

In a recent survey of FIEA members, questions on the format, design and content of Friday Offcuts were answered. Some of these suggestions have already been met. We've added an "e-Letters to the Editor" page for readers to comment on the news stories and issues raised across the industry. We've revamped the "jobs and equipment pages" and this part of the newsletter continues to grow in popularity. The jobs page has very quickly become the principal vehicle for weekly updates on situations vacant within the forestry, wood processing and pulp & paper industries in New Zealand and Australia.

Another suggestion by many of the readers was to include some regular updates on log pricing. We've started with New Zealand log prices as these, with the more open market and dominant species, are easier to track. We're delighted to announce this week that Friday Offcuts has set up a special deal with the principal suppliers of log price information. Agri-fax will be providing us monthly updates of pricing and trends of the principal log grades. These will appear on the last Friday of every month - within a week of the data been collated. In addition, price information and trends from data collected by the Ministry of Agriculture and Forestry will be appearing to supplement the Agri-fax information - every quarter.

Other statistical releases and data relating to forestry - from both sides of the Tasman - are expected to be built into the weekly newsletter over the next few months. We aim to continue to provide the most comprehensive weekly update of news stories and information to you - our readers. Enjoy. Subscribe a friend

This week we have for you:

X-ray scanning for full log internal defect recognition

The TOMOLOG X-Ray scanner, produced by MiCROTEC of Italy, generated considerable interest at the first in the ScanTech technology series run in Australia this week. The Rotorua event for NZ sawmillers runs on Tuesday and Wednesday of next week. The first commercial application of the technology was installed in European wood processing plants in 2001.

Preliminary studies based on Chilean radiata pine pruned logs have shown that TOMOLOG is detecting and interpreting the internal log characteristics with accuracy. Realistic transparent 3D images of the logs with longitudinal conveyer speeds of up to 200 meters per minute are being achieved. The result is an image showing the exact position and dimensions of branches, knotty core, and defects.

Australian sawmillers were told that the introduction of this 3D technology would have an immediate application in merchandising yards for optimisation of both appearance and structural log grades. In the sawmill application of the X-Ray scanning technology is considered best placed prior to the secondary break-down saws for the scanning of cants to optimise clear-wood recovery. Another new technology produced by the Italian manufacturer and discussed will have application for automated lumber grading and automated identification and recovery of blocks and clear cuttings components.

Full details of this and an array of new scanning and sawmill optimisation technologies from the ScanTech 2006 series is available by contacting Ph +64 7 921 1380. Limited copies of the detailed proceedings will be available. For NZ sawmillers, ensure you get through to Rotorua for the the two-day programme on Tuesday 30 May.




Premier Award In NZ Log Transport Safety

A big drop in log truck crashes during a time of rapid growth in the industry has earned the Log Transport Safety Council the Premier Award in the latest New Zealand Road Safety Innovation and Achievement Awards. A 65 percent reduction in log truck crashes and a 75 percent reduction in rollover crashes over the past seven years have helped the logging industry move from one of the most unsafe in commercial transport to one of the best. More >>




Management buyout in Kaingaroa

The owners of Kaingaroa Timberlands in New Zealand have sold the management company Kaingaroa Timberlands Management Limited (KTML) to the senior managers. The sale is effective from 1 July 2006. KTML currently manage the Kaingaroa forest estate on behalf of the owner, Kaingaroa Timberlands and under the new arrangement will continue to do so.

The existing owner has sold the management company, which was acquired as part of the original purchase in December 2003, consistent with its focus being on forest investment rather than operational management. David Balfour and Wayne Derrick will be Joint Managing Directors. Philip Langston will be stepping down as chief executive and moving into an investment management role.




NZ Log Price Movements

 
Overall Log Index:

The Agri-Fax Log Price Index, which measures returns from the whole forest, was up $1/tonne to $72.60 (delivered mill/wharf basis). This was due to mainly to the good rise in pruned prices in both Islands. Further increases are expected in overseas log prices and provided the Kiwi dollar remains subdued and ocean freight settles back, unpruned logs should contribute to further rises in the Index next month. A degree of optimism is replacing the forestry industry's downcast mood of recent times.

Log price changes:
North Island

  • Domestic: Pruned prices are up $3 to $5/tonne, while unpruned are up $2 to $3/tonne.
  • Chip: Unchanged, but roundwood has increased by up to $5 per tonne.
  • Export: Export log grades are mixed but steady on average. Pulp log prices are steady.
    Both logging and cartage costs are rising by approx $1/tonne, because of fuel costs.
South Island:
  • Domestic: Pruned prices are steady in Otago/Southland and up $2 to $6/tonne elsewhere.
  • Export: Export: Price changes are mixed for most grades, with some rises in the Northern SI, but overall there is little change. Pulp prices are slightly lower in Otago.
For more detailed reports contact Agri-Fax at: www.agri-fax.co.nz/enquiries.cfm


Scanning technology potential to save millions

The use of log scanning technology to detect internal defects in pine logs could potentially save the Australian timber industry millions of dollars, according to scientists. Researchers from the Queensland Department of Primary Industries and Fisheries found CT scanning could accurately detect the extent of internal resin defects and could be tailored to meet industrial productivity needs, reducing the economic impact on Australia's second largest plantation resource.


"Potential benefits include improved recovery and the ability to segregate logs with faults to more appropriate processing operations," Dr Harding said. "CT scanning would also enable resource managers to track log quality to the plantations and to assess the effects of genetics and forest management on resin defect levels."

The study, supported by the Forest and Wood Products Research and Development Corporation (FWPRDC), evaluated several scanning techniques in cooperation with laboratories in Australia, New Zealand and the US. Researchers singled out CT technology, known scientifically as x-ray helical computed tomography, as the only proven internal log scanning tool with the capacity to meet timber industry performance demands. However Dr Harding warned that the technique was unlikely to attract manufacturing interest for commercial prototype production - unless a whole-of-forest-industry business case is developed".

FWPRDC Executive Director Dr Glen Kile said the viability of CT log scanning rested in the hands of the forest products industry and relevant technology providers. "This research has demonstrated CT scanning's potential, however a commercially attractive product can only be realised through collaboration between a technology provider and a significant forest products industry player or consortium," he said.




Staff movements - on both sides of the Tasman

Change is afoot at Carter Holt Harvey Forests with Jeremy Fleming in New Zealand stepping down from his lead role and confirmation last week that Bruce Easton will also be leaving the company shortly as well. Keith Raymond will join the company soon to fill the position previously held the late John Gaskin. Replacements for Fleming and Easton have not yet been announced.

After 25 years with Poyry Forest Industry Consulting (and its predecessors) Rob de F


Australian eucalypt hardwood plantation harvest rises

The Australian eucalypt hardwood plantation harvest (log removals), mainly for woodchip exports, increased significantly in 2004-05, according to a new ABARE report. The report, Australian Forest and Wood Products Statistics, was released last week by Dr Brian Fisher, Executive Director of ABARE.

Total roundwood log removals rose slightly by 1 per cent to 27.4 million cubic metres in 2004-05, with eucalypt hardwood log removals from native forests falling slightly, by 4 per cent to 10 million cubic metres. "However, eucalypt hardwood plantation log removals increased by 58 per cent to 2.9 million cubic metres, due to an increase in harvesting of eucalypt plantations for woodchip exports," Dr Fisher explained.

Dr Fisher noted "that the value of forest product exports fell in the September quarter 2005 by 13 per cent, however recovered in the December quarter by 9.5 per cent to AU$534 million." "Following on from a record level of woodchip exports in 2004-05 of AU$858 million, woodchip exports fell in the September quarter by 21 per cent to AU$185.6 million from the June quarter, but recovered in the December quarter 2005 by 19 per cent to AU$220.6 million, mainly reflecting a rise in both the volume and a 2 per cent rise in the unit value of hardwood woodchip exports to Japan," Dr Fisher said.

Sawnwood exports in both the September and December quarters 2005 remained just above AU$31 million, about 22 per cent higher than the corresponding quarters in 2004. "The increase in sawnwood exports continues to be driven by an increase in the volume of lower valued coniferous sawnwood to Asian markets, particular China and Chinese Taipei," Dr Fisher explained.

For copies of the report Australian Forest and Wood Products Statistics, September and December quarters 2005, please visit the ABARE web site on www.abareconomics.com




Biomass Harvest now a standard in Finland

The electronic newsletter Nordic Family Forestry reports that all three of the major forest products companies doing business in Finland-Mets


Brazil aims at new 2006 deforestation rate

The State Secretary of Environment and Resources (SEMA), the Brazilian Environmental Institute (IBAMA) and the federal government have set the goal of reducing the rate of burning and deforestation of the Brazilian Amazon in 2006 by 15% in comparison with 2005. In 2005, the deforestation rate in the Amazon was reduced by 31% from 27,200 km


Fumigation treatment for logs into China

Xiuyu Port, located in Putian, Fujian province, is the only place that accepts imported logs coming directly to China by sea without fumigation treatment. Currently the fumigation facility, which has been officially put into operation, can treat 3 million m3 of imported logs per year. Recently, the Administration for Quality Supervision and Inspection and Quarantine (AQSIQ) indicated that logs from Alaska, US can be exported directly to this area without fumigation treatment. To form a complete facility with the fumigation area, a timber processing area has been under construction since April 2005, with a total planned area of 13,340 hectares. The first stage of the development will cover an area of 3,335 hectares. To date, the area has attracted investors from the United States and Japan. Thirty three investment contracts have been signed, worth US$283.6 million (RMB 2.3 billion). This provides an opportunity for companies to export logs to China without fumigation treatment.Source: NZT&E, www.marketnewzealand.com, 4 May 2006.




New office products business created in Australia

In a further strategic initiative, PaperlinX has announced that it will establish a new business entity to further build on its existing business platform in office products in Australia. The new business will be formed through the integration of the tudor(R) group, Spicers Office Papers and Australian Paper's Office Papers Division.

With brands such as Reflex(R), tudor(R), Optix(R), Olympic(R), Universal(R) and Zoom(R) and sales above $400 million, this newly integrated business will be one of the largest office products suppliers in Australia. The combined business will be in a position to increase value and service to customers, through a more efficient route to market, as well as providing an excellent opportunity for all three existing businesses to improve their long term sustainability. More >>




LP seeks clearance for US$40 million project

Louisiana Pacific has presented a US$40 million Oriented Strand Board (OSB) project for environmental impact approval to the National Environmental Commission CONAMA in Chile. The industrial plant would be located in the IXth Region and production capacity would be 145 thousand cubic meters per year.Source: NZT&E, www.marketnewzealand.com, 4 May 2006.




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...and one to end the week on...the Hokey Tokey

With all the sadness and trauma going on in the world at the moment, it is worth reflecting on the death of a very important person, which almost went unnoticed last week. Larry LaPrise, the man that wrote "The Hokey Tokey" died peacefully at the age of 93. The most traumatic part for his family was getting him into the coffin. They put his left leg in. And then all the trouble started.


And on that note, have a great weekend. Cheers.

Brent Apthorp
Innovatek
PO Box 904
Level Two, 2 Dowling Street
Dunedin, New Zealand
Ph: +64 3 470 1902
Fax: +64 3 470 1904
Web page: www.innovatek.co.nz


This week's extended issue, along with back issues, can be viewed at www.fridayoffcuts.com

We welcome comments and contributions on Friday Offcuts. For details on advertising for positions within the forest products industry or for products and services, either within the weekly newsletter or on this web page, please contact us.

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