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US
Dollar Exchange Rates of 14th December 2006
China Yuan
7.833
Report from China
China¡¯s panel export expansion continues unabated
The expansion of Chinese plywood and fibreboard exports in recent years is well known. China has transformed itself
from a major importer to a major producer and exporter of wood-based panels over the last 10 years. China¡¯s woodbased
panel production has been growing at around 40% a year since the mid-1990s. Production of high and middle
density fibreboard (MDF) climbed 1,821% from 965,000m3 in 1996 to 18.54 million m3 in 2005 while that of
plywood jumped 413% from 4.9 million m3 to 25.15 million m3 in the same period, according to Customs
statistics (see chart). China is currently the world¡¯s largest producer of both high and MDF, and plywood.
With the continued and rapid development of China¡¯s
wood-based panel industry, plywood imports halved to 589,000 m3 while fibreboard imports fell less markedly
(down 4.7%) to 967,000 m3 between 2000 and 2005 (see chart). In contrast, Chinese exports of plywood surged
714% to 5.59 million m3 while those of fibreboard soared 3,840% to 1.379 million m3 during the same period. In
Jan-Sep 2006, exports of these products continued to grow, rising 44% to 5.91 million m3 (up 52% to $2.05
billion) and 43% to 1.49 million m3 (up 56% to $453 million) while imports fell 27% to 340,000 m3 (down 29%
to $163,000) and 13% to 620,000 m3 (down 12% to $149 million), respectively.
Prices for tropical logs surge ahead of those for other logs
Average FOB prices for China¡¯s imported logs rose 26% from $104.6 to $132 per m3 from January to October
2006, according to Customs statistics. However, price increases differed across top log suppliers, namely Russia,
PNG, Malaysia, Myanmar, Gabon and New Zealand. Logs from Russia registered the smallest increase (10.6%),
although Russian logs accounted for 69% of total log imports. Prices for Myanmar logs soared 186.5% in
average to 247.3 per m3, the largest price increase. The surge was due to shortages of Myanmar export species
such as teak, padauk and ald birch, and a cross-border trade blockage with that country since March 2006. Prices
for other tropical logs also registered hefty increases. Prices for Malaysian and PNG logs surged 19% and 15%,
respectively while those for New Zealand logs rose just under 11%.
Chinese launches green procurement policy
China¡¯s Ministry of Finance and the State Environmental Protection Administration (SEPA) have announced that,
starting in 2007, the nation¡¯s central and provincial governments will prioritize their purchasing of
environmentally friendly products and services. The government¡¯s new ¡°green procurement¡± policy will be implemented at all levels of jurisdiction starting in 2008.
The current ¡°green purchasing list¡± includes 859 products in 14 categories, ranging from vehicles, photocopiers,
printers, and televisions to flooring, paint, and other construction materials. SEPA has promised to continually
update the list. SEPA launched the China Environmental Label in 1993. It now includes 56 categories of products
and services and is used by some 1,300 enterprises on 21,000 products, including construction materials, textiles,
vehicles, cosmetics, electronics and packaging.
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