With tightening supply of hardwood fiber in the Pacific Rim, prices for hardwood chips exported from Latin America were up 15% in the 1Q/19 from their eight year-low in late 2017, reports the WRQ

Export prices for hardwood chips jumped for all three exporting countries in Latin America in the 1Q/19. The biggest increases were for chips shipped from Chile and Uruguay, which were up over 10% from the 4Q/18. Prices for chips exported from Brazil were up six percent quarter-over-quarter. For Brazil and Chile, both countries that are selling all their export volume to Asia, current price levels were below their ten-year averages in early 2019 (see chart in the latest WRQ).

The hardwood chip price index for Latin America, which trended downward during much of 2012 to 2017, has increased quarter-over-quarter for four of the past five quarters and was up 15% in the 1Q/19 from its eight-year low in the 4Q/17.

Hardwood chip prices increased during the first half of 2019 but may have reached a peak in the second quarter and could potentially even decline in the second half of the year because of reduced demand for wood fiber in China. Longer-term, prices for hardwood fiber will likely trend upward again because of an expected tightening of the current sources for hardwood chips in the Pacific Rim. Despite this, it is uncertain if higher prices will make much difference for chip suppliers in Latin America when domestic demand increases with new pulp capacity coming on-line, and local chip prices match those of the export market. Chile’s and Uruguay’s participation in the export market may be declining in the coming years.

The trade of wood chips in the Pacific Rim in the 1Q/19 remained practically unchanged from the previous quarter, with increases in imports to Japan balancing out decreases in imports to China, reports the WRQ (Note. see the WRQ Trade Snapshot for imports during the first five months of 2019). Year-over-year, imports of softwood and hardwood chips to Japan, China, Taiwan, and South Korea have fallen five percent due to slowing pulp production.

All of the major supplying countries to the Pacific Rim reduced shipments in the 1Q/19 with the exception of Thailand (+44%) and South Africa (+47%). The biggest declines in the past year have been seen in exports from Australia (-19%), Brazil (-19%) and Chile (- 14%). In the 1Q/19, hardwood chips from Latin America accounted for 17% of the total trade to the region, a share that was down two percent from the 1Q/18.

Contact Information
Wood Resources International LLC
Hakan Ekstrom, Seattle, USA

September 2019 will again see one of the largest gatherings yet seen in this region of wood scanning, sawing, saw and mill maintenance technology specialists, innovators and leading practitioners. The two-day independent programme, WoodTECH 2019, will be providing New Zealand and Australian sawmills with a unique opportunity to learn about the very latest in technologies and operating practices from around the globe.

Registrations continue to pour in. Most mills have been taking full advantage of the significant discounts that are still open for multiple registrations from sawmill production sites. The conference, workshops and exhibitions have been specifically designed alongside industry into two-days in each country.

They’ve also been set up to encourage sawmill teams – management, mill production, saw-doctors and maintenance staff – to take advantage of the line-up of world class international specialists being brought into the region. This ensures teams from individual mills can collectively hear from and meet up with the technical expertise and then put the practical learnings into practice once back on site.

For a full appreciation of what’s happening in September, check out the listing of all major equipment and technology suppliers to the sawmilling industry involved in either presenting or exhibiting. Companies involved include;

USNR, USA/Canada, ScanMeg, Canada, Optimil Machinery, Canada, LMI Technologies, Sweden, Nicholson Manufacturing, Canada, JoeScan, USA, EWD/Linck, Germany, IWT-Moldrup Asia Pacific, Singapore, TS Manufacturing, Canada, SiCam Systems, Canada, GCAR Design, Canada, Lewis Controls, USA, Taqtile, Singapore, TimberSmart, NZ.

Timberlink, Australia, Precision Machinery, Canada, Williams & White, Canada, Simonds International, USA, Winsaw Mill Services, NZ, Holtec, NZ, KeyKnife, Braford Industries, Australia, Andritz, NZ, ILS, NZ, Pacific Sawmill Engineering, NZ, Supply Services, NZ, High Duty Plastics, NZ, Modern Engineering, Australia, Thode Knife & Saw, NZ, Tui Technology, NZ.

Checkmate Precision Cutting Tools, NZ, Saito, NZ, HewSaw, Australia, Stinger World, Australia, Automation & Electronics, NZ, AKE Sales Tech, Australia, Accurate Group, Australia, Indufor Asia Pacific, NZ, The Lean Hub, NZ, Fagus Grecon, Germany, Prodetec/Firefly, Australia, Phoenix Sawmill Supply, Australia, Vecoplan, Germany and Camco, Australia.

It’s an impressive line-up – that occurs only once every two years. The series runs in Rotorua, New Zealand on 11-12 September and then again in Melbourne, Australia on 17-18 September 2019.

Full programme details and registrations to WoodTECH 2019 can be made on the event website, www.woodtech.events.

A huge need exists for up-to-date, precise forest inventory data in Russia. The transition from extensive forest management to intensive forest management has already started in several regions of northwest Russia, resulting in an increase in pulpwood available on the market. Detailed information on current forest resources is a basic requirement for this transition.

Luke carried out the research project “Competitive solution based on Finnish knowledge for management of up- to-date forest resource data in Russia (ISKRA)” to develop a cost-efficient solution for collecting information. “Beyond Visual Line of Sight” (BVLOS) drones were used to cover an area of 18,000 hectares in four days. BVLOS is one of the most promising concepts in the commercial drone world today, as it enables service providers to cover huge areas in a relatively short period of time, with spatial resolution of one cm per pixel. The project partners in Russia received permission to fly BVLOS in the Republic of Karelia, and they followed all local regulations related to obtaining and handling aerial data.

“BVLOS will change the market for commercial drone users, offering a cheaper alternative to current applications such as airplanes and helicopters. The relatively low human involvement will drive costs down, leaving only questions of regulation and data processing. With BVLOS, the latter requires different approaches than those of traditional consumer drones due to the large size of data”, said Eugene Lopatin, senior scientist at Luke.

During the ISKRA project, the tree-wise forest inventory was carried out on an 18,000-hectare area leased by the participating pilot company in the Republic of Karelia. A total of 13,652,458 trees were mapped using drone data and data processing algorithms developed for the project. Each tree’s height, breast height diameter, species and age were measured. The project demonstrates a huge potential of drones for smart forest management not only in Russia but also in Finland.

As part of this year’s ForestTECH 2019 series being run in November in both Australia and New Zealand, trials being undertaken with BVLOS and opportunities for local forestry companies will be discussed. Registrations are now open for the conference and associated workshops (some of which limited numbers will apply). Full details on the programmes for both countries can be viewed on the event website; www.foresttech.events.

Source: Natural Resources Institute Finland (Luke)

Photo: The Natural Resources Institute Finland (Luke) used BVLOS drones to carry out tree-wise forest inventory on an area of 18,000 hectares in North-West Russia

Nelson Forests Ltd is exploring new ways to meet wood export market demand that will create jobs, increase domestic processing of logs in the Marlborough region, and add value to the Top of the South economy. Nelson Forests and Kaituna Sawmill are owned by Australian company OneFortyOne. OneFortyOne Executive General Manager – New Zealand, Lees Seymour, says the company is exploring opportunities to process more logs on shore and to develop alternative wood chip markets.

Seymour says that Nelson Forests has hired a project manager to do a feasibility study on a number of projects, with one being investigating the building of a facility that would enable the export of wood chips from Port Marlborough. The process involves chipping logs and forest residues, resulting in higher-value woodchip being exported, greater returns to Marlborough forest owners and improved environmental outcomes for the region. To increase volumes available, woodchip from sawmills could be added to the mix, including woodchip produced by the Kaituna Sawmill.

Another project is investigating debarking export saw logs that are not suitable for processing in domestic mills. The de-barking process removes the need for fumigation of whole logs for the export market.

Nelson Forests Ltd and Port Marlborough have signed a Memorandum of Understanding that outlines how the two companies will work together through the feasibility phase and if successful through to implementation. “The relationship we have with Port Marlborough is outstanding and we are very happy to be able to work with such a professional team,” says Seymour.

Rhys Welbourn the CEO of Port Marlborough says he is “delighted to be able to work with Nelson Forests to develop the feasibility and business case – this is good news for the port and good news for Marlborough”.

The Kaituna Sawmill currently processes about 115,000 tonnes of logs per annum and is investigating options to increase the scale of the operation; again this will create jobs, increase domestic processing of logs and add value to the Top of the South economy. Seymour says that “in order to increase sawmill capacity there is the need to develop new woodchip markets, you can’t do one without the other.”

Port Marlborough exports approximately 700,000 tonnes of logs a year at Picton, with the capacity to export a million tonnes. There is an opportunity for other forest owners to supply logs for chip export and woodchip producers to supply woodchip, and it is not limited to the wood from the company’s own estates or Kaituna Sawmill. “If we could do it, it would be helping other forest owners as well, adding more value to the regional export pipeline.”

If the feasibility study is positive, Seymour says the company believes it could start exporting chip by the end of the 2020.

OneFortyOne Executive General Manager – New Zealand, Lees Seymour

Tigercat has announced the launch of SECURE – Tigercat’s new extended coverage program.

SECURE offers customers a selection of four competitive coverage plans for engines and drivetrain components that begin after the standard warranty period on drivetrain components has ended. SECURE increases engine and drivetrain component coverage to 3-year/6000 hours, with the option to add in a travel time and mileage allowance.

SECURE is a factory-backed program that can be applied to any machine equipped with a Tigercat FPT engine.

Tigercat Coverage
Learn about Tigercat factory-backed standard warranties and the SECURE extended coverage program.

Tigercat Secure – Extended Coverage
Want more protection? Purchase a SECURE plan and have peace of mind with your investment.

The Tigercat SECURE program provides additional coverage that begins after the standard warranty period on drivetrain components has ended. SECURE increases drivetrain component coverage to 3-year/6000 hours, with no deductible.

The following four SECURE plans are available for purchase:

Secure Engine
A standalone extended Tigercat FPT engine coverage to 3-year/6000 hours, including limited TTM (travel time and mileage) allowance over the 3-year term.5

Secure Drivetrain
Covers major hydraulic and drivetrain components.

Extended free RemoteLogTM subscription to 3-years for RemoteLog equipped machines.

Secure Drivetrain+
Covers major hydraulic and drivetrain components and includes limited TTM (travel time and mileage) allowance over the 3-year term.

Extended free RemoteLog subscription to 3-years for RemoteLog equipped machines.

Secure Drivetrain+ Engine
Covers major hydraulic and drivetrain components as well as the engine and includes limited TTM (travel time and mileage) allowance over the 3-year term. Extended free RemoteLog subscription to 3-years for RemoteLog equipped machines.5

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Tigercat SECURE can be purchased with any new machine or anytime during the standard drivetrain warranty period.

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Tigercat Standard Warranties
Tigercat machines are backed by the following standard warranties:

Drive-To-Tree Feller Bunchers And Wheel Muclhers 4-3-2-1
4- year/8000 hours for the centre section components1
3- year/6000 hours on structural components2
2- year/4000 hours on drivetrain components3
1- year/2000 hours comprehensive4

Skidders 4-3-2-1
4- year/8000 hours for the centre section components1
3- year/6000 hours on structural components2
2- year/4000 hours on drivetrain components3
1- year/2000 hours comprehensive4

Knuckleboom Loaders And Processors 3-2-1
3- year/6000 hours on structural components2
2- year/4000 hours on drivetrain components3
1- year/2000 hours comprehensive4

Track Carriers, Forwarders, Wheel Harvesters, Track Mulchers, Loader Forwarders And Utility Vehicles
1- year/2000 hours comprehensive4

Tigercat Fpt Engines (Tier 4 And Above)
2- year/2000 hours for engine components
5- year/3000 hours for emission components

The Tigercat FPT standard engine warranty includes limited TTM (travel time and mileage) over the standard warranty term

The Coal Tit is smaller than the Blue Tit and is very common in coniferous woodland and makes greater use of this habitat than other tit species. Their small size and agile nature allow them to glean food from between pine needles and pine cones with its narrow bill. Coal Tits use broadleaf woodland to a greater extent than their continental cousins and consequently have slightly larger bills. In Ireland, Coal Tit bills are even larger than their UK counterparts.

Periparus ater hibernicus is a unique sub species found only on this island. Irish coal tits have creamy yellow face patches whereas the cheeks of birds elsewhere are white. Small differences in bill size between individuals using different habitats may seem inconsequential but it is widely known among ornithologists that even very small differences in bill size can give a competitive advantage.

An analysis of records in 2007 by Ailsa McKenzie of Newcastle University in the UK, revealed that in the years when the seed crop was good in Sitka Spruce plantations in the UK, there was a decline in the use of garden feeding by the Coal Tit, but in those years when the Sitka Spruce seed crop was poor, Coal Tits increased their use of garden feeders. This pattern was also seen in Siskin.

The Coal Tit is the only member of its family that has learned to make a larder. Individual birds will visit feeders frequently but rarely eat the food immediately instead they take it away to a store so that when times get hard, they have something in reserve.

Seeds form an important component of the diet during autumn and winter, the lack of favoured invertebrates forcing the Coal Tit to switch its attentions to what is available. Even so, they will take any hibernating insects that they can find, sometimes even from the undersides of conifer branches heavy with snow. The combination of hoarding, the switch to tree seeds and the agility of this small bird, may explain why it seems to cope with cold winters more successfully than other small species.

The planting of conifers over the last century has been a blessing with the tits repaying the forester by eating harmful insects. In winter coal tits gather into flocks to roam the countryside. The ancestors of our coal tits probably came with the conifers at the end of the last ice age and the bird has been on its own here ever since.

The growth and stabilisation of the Cold Tit is thought to have been the result of Sitka Spruce seed feeding opportunities afforded by thousands of acres of maturing plantation forestry across Ireland.

FACTS: Coal Tit Periparus ater
Conservation status: Favourable

Diet:
Insects and spiders; also seeds in winter. Mostly taken from outer branches of conifers.

Longevity:
Typical lifespan: 2 years
Lifespan: Up to 18 years

Breeding Ecology:
Clutch size: 9–10 eggs Number of broods: 1–2
Incubation: 14–16 days
Young in nest: 16–19 days
Age at first breeding: 1 year

Source: Veon
https://www.veon.ie/coal-tits-thrive-in-sitka-spruce-plantation-forests/

Sveaskog’s 2Q net sales, which comprise both deliveries from its own forest and externally acquired wood raw materials, increased to SEK 1,925 million. Prices increased by 9% on average and total delivery volumes were down by 10%. The sales of wood raw materials amounted to 5.5 million cubic metres whilst deliveries of seedlings have increased.

2Q 2019 operating profit decreased by 15% to SEK 323 million ($33 million). The positive effect of higher prices has been counteracted by lower volumes. Costs for harvesting and forest management have increased. Income from other property transactions is also down. The increased sales of seedlings have affected the result positively.

1 January – 30 June 2019 net sales increased by 8% to SEK 3,849 million.

1H 2019 operating profit increased by 7% to SEK 832 million ($85.3 million). Higher prices are partly offset by lower volumes from own forest. Costs for harvesting and forest management have increased. Income from other property transactions is also down.

Sveaskog is Sweden’s leading forest company and sells sawlogs, pulpwood, biofuel, forest seedlings and silvicultural services.

Forestry England, the country’s largest land manager and the arm of the Forestry Commission that manages the nation’s forests, has a new chief executive.

Mike Seddon has almost 30 years of experience in forestry and forestry policy and begins his new role 1 August 2019.

Mike said:

“Forestry England manages one of the country’s greatest public assets: the nation’s forests.

“The need for public forests came from tough times between the two World Wars and I am incredibly proud to be leading the organisation towards another hundred years. From an emerging climate crisis to wildlife decline, the challenges for the next century will be tough, but I am driven to expand on the great things the nation’s forests already achieve today.

“Our forests welcome more than 230 million visits every year – and we will make forests even more accessible by planting some forests closer to where people live. As they grow they will create places to relax and improve people’s physical and mental health. All of the forests in our care will continue to work for society and we will increase their natural capital. From cleaner air and reduced flooding to walking trails and play equipment we are making wildlife-rich, connected landscapes.”

The nation’s forests supply around half of the country’s home-grown timber, all meeting international standards for sustainability. Some of country’s rarest wildlife thrives under Forestry England’s careful management in heathland, wetlands and, of course forests. From majestic hen harriers to fascinating ladybird spiders they all rely on experienced ecologists and foresters.

Looking forward, Mike continued:

“All forests, and the wildlife that depends on them, will need to survive and thrive in a changing climate. We will also need more forests to absorb carbon while they grow and we can keep that carbon locked up by using more timber products.

“The challenge is huge and we are ambitious: we want to connect everyone to the nation’s forests.”

Strong demand in the sawn timber market

The new Senior Vice President of Business at UPM Timber, Aki Temmes, estimates that the demand for sawn timber remains at a healthy level, even though the peak of the economic cycle might have been reached last year.

“We made good deals and the volumes moved very well in the first quarter of 2019.”

In Finland, UPM Timber consists of four sawmills with a total capacity of over 1.5 million cubic metres. UPM Kaukas sawmill is the largest, producing over 500,000 cubic metres of sawn timber per year.

A lot of UPM Timber’s production is sold domestically in Finland. “After Finland come China, Japan and the UK,” Temmes explains.

Even though the sawn timber trade was brisk during the beginning of the year, there are uncertainties in the global economy that could also weaken the outlook for sawmills. The principal concerns are related to the trade war between China and the United States, and the effects of Brexit.

“Since we cannot affect the global market, we must do our best in business. We have a clear strategy, high-performance sawmills and professional sales — all the necessary components for successful business. We intend to be a reliable partner to our customers in the future, too,” promises Temmes.

Efficient sawmills

In 2012, UPM decided to stop the further processing of sawn timber and to concentrate on sawing alone. Since this decision, the sawmills have been running at full speed.

“Since then, we have operated the sawmills based on the full-run strategy. There have been no market-related limitations on production. This sets us apart from most of our competitors,” says Temmes.

He states that industrial operations such as the sawmill industry are most efficient when the facilities are in full use.

“All wood that arrives at our sawmills is carefully used for production. Not even a single stick is wasted. Sawn timber generates value: wood chips, sawdust and other by-products are used for pulp, paper and energy production,” Temmes clarifies.

A sustainable product with a bright future

UPM sells most of its sawn timber to industrial customers in the furniture, construction and packaging sectors, or to customers for various further processing procedures.

“The range of customers and end-uses for our product is extensive. UPM Timber aims to establish and maintain international long-term partnerships. From the standpoint of future challenges, we are a great partner with a solid foundation, and we concentrate on our core capability: producing sawn timber for the right end-use applications at the right time,” says Temmes.

All UPM sawn timber is certified according to the FSC or PEFC certification schemes.

“Customer and market preferences vary, and we can use both certificates flexibly.”

Temmes believes that the future of sawn timber is bright.

“Our product is amazing. Sawn timber binds carbon throughout its lifecycle, which can last for hundreds of years. It is produced in a responsible and environmentally friendly way and it meets all the sustainability requirements.”

Aki Temmes emphasises that the quality of the end-product is based on the production expertise, good forestry and close collaboration with forest owners.

“We naturally aim to be able to provide our customers with added value and bring peace of mind and flexibility to their operations. We will succeed in providing sustainably produced Finnish sawn timber at a consistently high standard, as well as excellent service,” Temmes concludes.

Photo: Aki Temmes – Senior Vice President of Business

UPM Timber welcomed Aki Temmes, 41, to the position of Senior Vice President of Business in late April. He transferred to the position of head of UPM Timber from the position of Vice President of Business Control at UPM Biorefining. Aki has worked at UPM for over 16 years; in addition to Biorefining, he has worked in the Paper Business, UPM Timber and Wood Sourcing.

“I am excited to return to UPM Timber after being away for about six years. A lot of good work has been done at Timber under the supervision of my predecessors, and the business operations have improved significantly over the past few years,” Aki says.

Weyerhaeuser Company reported 2Q 2019 net earnings of $128 million, or 17 cents per diluted share, on net sales of $1.7 billion. This compares with net earnings of $317 million, or 42 cents per diluted share, on net sales of $2.1 billion for the same period last year.

Adjusted EBITDA for the 2Q 2019 was $343 million compared with $637million for the same period last year and $365 million for the 1Q2019.

“Our businesses delivered strong operating performance in the 2Q despite various market and weather-related challenges,” said Devin W. Stockfish, president and CEO. “This includes the lowest controllable lumber manufacturing cost we have ever reported. Looking forward, although record-setting rainfall has held back U.S. housing activity in the first half of 2019, we see solid underlying market conditions and continue to expect the housing market will follow a modest growth trajectory. We remain committed to delivering industry-leading performance, fully capitalizing on all market conditions, and driving superior value for shareholders.”

Weyerhaeuser Company, one of the world’s largest private owners of timberlands, began operations in 1900.

Photo: Devin W. Stockfish, Weyerhaeuser President and CEO.