Exports Offset Slow Housing Market

5 December 2007
Continued expansion of exports to Asia is providing the Australian forestry industry with sufficient demand to offset a domestic market still recovering from a slow housing starts, according to a new ABARE report.
The report shows Australian forest product exports increased by $212 million, or 10%, in 2006-07, with an 11% rise in the volume of woodchip exports and a 42% increase in sawn wood exports.
The $212 million increase in exports was driven mostly by an extra $116 million of woodchips going to Japan.
Round wood exports to the Republic of Korea also increased by $26.5 million and about $20 million of additional sawn wood went to China and Vietnam combined.
“This export growth cushioned Australia’s forestry industry against the effects of the weak housing sector,” the executive director of ABARE Phillip Glyde said.
“The sawn wood sector appears to be in good shape, when we consider that housing starts in Australia appear to again be on the increase, as indicated by strong increases in Queensland.”
Mr Glyde also noted the ongoing shift in the Australian forest industry away from native forests toward more intensively managed forest plantations.
The volume of logs harvested from hardwood plantation forests increased by almost 7% over the year, while softwood plantation logs also increased slightly. In contrast, there was a fall in the volume of logs harvested from native forests of nearly 1%.
Hardwood plantation logs have increased from 2% of the total volume of hardwood logs harvested in 1996-97 to 32% in 2006-07.
“We expect this ongoing trend of structural change within Australia’s forestry industry to continue in coming years as many of these hardwood plantations reach maturity,” Mr Glyde added.

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