Northwest log exports are booming but clouds are on the horizon

By: | at 08:00 PM | Channel(s): Maritime  International Trade  

By Stas Margaronis, AJOTA major Pacific Northwest exporter says that logs exports to Asia and especially China are booming, but concerns are being raised about a downturn in the China market and the viability of a Chinese importer.
Tom Leeds, President, Pacific Lumber and Shipping ( PLS) told the AJOT: “We are benefiting from a new 11 million cubic meter market that developed in the latter part of 2009 when Russia raised export tariffs reducing Russian logs going to China resulting in its trade declining from 25 million cubic meters to 14 million cubic meters.”
PLS is a subsidiary of Port Blakely Companies, which owns tree farms in Washington and Oregon.
Leeds adds that the” U.S. Pacific Northwest and New Zealand have jumped into that gap and for us 2010 was a breakout year for exports and 2011 looks to be an even better year.”
As a result, the Port of Longview, Washington reported that log exports helped drive up exports in 2010.
The Port of Longview recorded 2.3 million metric tons of total cargo handled in 2010, up 55% from 1.4 million metric tons in 2009. While imports were down, exports soared nearly 70%. The port said the dramatic increase in exports can be attributed to a rapid increase in demand for logs and agricultural exports, primarily bound for Asia. The decrease of import tonnage by 16% includes an anticipated decline in wind energy cargo.
“I am extremely pleased with the Port’s performance in 2010,” said President of the Commission Darold Dietz who added: “Three record years in a row is a true testament to our reputation as a quality facility and team.”
The PLS trade is mostly log exports where “we have handy-size shiploads being loaded from ports as Longview, Olympia and Vancouver Washington going to China and other Asian ports. We have smaller loads being shipped out from Coos Bay Oregon and Eureka, California.”
PLS does ship some container loads of lumber from Seattle/Tacoma and Portland.
In Eureka “we have had a very positive response from the longshoremen there who are very supportive of the new business that began in April” Leeds said.
Leroy Zerlang Port Manager for Brusco Tug and Barge and an agent for Trans-Marine Navigation, is based in Eureka, California. He says the California port has not seem so much business in twenty years:
“The trade is going very well and people here are very excited. We have logs stacked up on both sides of the Bay which is the first time in twenty years. It’s a breath of fresh air for everyone on the waterfront. Our tugboats are busy, the Port of Humboldt Bay is making some money, the longshoremen and the bar pilots are busy.
Leeds says that “China is our largest market followed by Japan and South Korea.”
Other ports that are shipping exports are Astoria, Oregon, Grays Harbor and Port Angeles, Washington, he said.
However, a Washington, state based maritime executive, who asked not to be identified, is worried that the boom in exports to China may be short-lived.
He says there are reports that the Chinese housing market is showing signs of a major slow down, which could adversely impact exports.
He is also worried about the viability of a Chinese wood products importer, Sino-Forest: “The China trade is at a very sensitive stage at the moment. The allegation of corruption and misinformation at Sino-Forest, one of the leading Chinese log importers, is being investigated in Canada.”
He cites a July Reuters report that raises a number concerns about the company:
“Embattled Chinese forestry company Sino-Forest said on Wednesday it has postponed a tour of its forestry assets because many analysts have halted coverage of the company.
The value of Sino-Forest shares and bonds collapsed last month after short-seller Muddy Waters accused the company of fraudulently exaggerating the size of its forestry assets.
The company has denied the allegations and appointed an internal committee of its independent directors to investigate the matter. However a full review is expected t

Stas Margaronis's avatar

American Journal of Transportation