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Analysis on trade condition of major wood products in China during the first half of 2012

China Agriculture Report By CnAgri2012-09-13 13:08:59China Agriculture Report Print

Influence from international economic crisis and debt crisis were spreading since 2012, the growth of world economy was short of motivation, the shrinking of international market affected China’s wood imp & exp a lot. From January to June, trade increase of wood products was 3% year on year, much lower than the 28.6% of 2011. In June, trade increase was 4.4% year on year, much lower than the 20.6% of 2011. According to relative statistics, imp & exp increase of wood products in China dropped a lot.

Imp & exp increase of wood products in China dropped during the first half of 2012

According to statistics from Customs, total amount of wood product imp & exp was $57.79billion during the first half of 2012, up 3.0% year on year. Of the above, the import was down 1.1% year on year which showed negative growth, the export was up 8.1% year on year.

Of the major imported wood products, the import of log, paper pulp, waste paper and natural rubber was down 4.8%, 4.4%, 3.2% and 17.6% year on year separately, which was the major contributor to the negative growth. Of the major exporting wood products, the export of furniture, plywood, wood-based products and paper products was up 8.3%, 13.9%, 10.6% and 14.0% separately.

Export to U.S. and Japan went stably while gloomy condition continued in Europe and ASEAN

With recovery of economy and real estate industry in U.S., consumption increase was noted. Wood product export from China to U.S. increased 13.4% year on year from January to June, of which in June the increase was 23.8% year on year. Besides, wood product export from China to Japan went stably with an increase of 10.5% year on year during the first half of 2012.

New market was lacking motivation

Affected by the slowing down of global economy, economy growth of the new merging BRIC countries also slowed down, and currency depreciation was noted, which influenced China’s wood product export by certain degree. In Jan-June export to South Africa increased by 17.3%, but in June it was down 10.4% year on year, the future trend was unclear. In Jan-June export to Russia and Brazil increased by 3.1% and 1.5%, lower than that of 2011.

Growth might rebound in the 2nd half of 2012

Due to the great demand shrinking in international market, the increasing cost to maintain business operation, the fund-collection difficulty for middle-small size enterprises and pressure from exchange fluctuation, operation and risk pressure were much felt by wood imp & exp enterprises. Generally speaking, wood product imp & exp growth slowed a lot during the 1st half of 2012 compared that of 2011. However, with the implementation of governmental macro adjustment policies, the growth shall see some rebound in 2nd half of 2012. Experts suggest that export tax-refund of certain wood products shall be increased, meanwhile structure adjustment and industry transformation upgrade shall be promoted to strength the export sustainability.

Investment was made to build No.1 Russia wood exchange market in Manzhouli

The investment was by China Poly Group Corporation, RONGER Electronics and Fiber Group and Manzhouli Lianzhong Wood Co., Ltd. The total investment amount was RMB1.0825billion Yuan for two parts, domestic part and overseas part. Investment amount for domestic part was RMB0.5billion Yuan, to complete a 5-square-kilometer project which shall cover spot goods exchange, warehouse center, logistics distribution center and exhibition hall for enterprises, etc. RMB0.5825billion Yuan will be invested in the project in Russia, which will sign contract with both Railway Ministry of Russia and enterprises with annual wood cutting capacity above 0.2million cubic meters. At the same time, 7 agency offices will be set.

The project covers the whole industry chain including wood cutting, production, trading, stock, logistics, finance and insurance, which shall be the biggest futures and spot goods exchange market of wood and wood products from Russia in China. The construction of domestic project shall last 4 years, total annual avenue will be RMB0.45billion with profit and tax around RMB80million, providing 1500 job opportunities. Investment amount in 2012 was scheduled to be RMB0.45billion, which was mainly for the construction of exchange hall, factory buildings, residential buildings and road, etc.

The project began from 20th March, all construction is now in process.

From "China Wood Market Monthly Report"

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