28 Nov 2011

'Bleak time' for sawn timber industry

10:48 pm on 28 November 2011

The sawn timber industry says it does not know when its bleakest period in decades will end.

The value of unprocessed log exports has more than doubled in the past two years as that part of the industry booms.

But the Timber Industry Federation says sales of sawn timber for the four months to August this year show a $70 million drop in exports across all markets.

Domestic sales are about half their historical level because few new homes are being built.

Timber Industry Federation chief executive Brent Coffey says sawmills are being hammered, there have already been closures this year and he sees little light on the horizon.

Mr Coffey says record volumes of logs going to Asia, which have more than doubled in the past two years, only make it harder for companies to source timber.

The rebuild of earthquake-hit Christchurch should eventually help - but not until at least the middle of next year, he says.

A sales manager at exporter LumberLink believes things will probably get worse before they get better.

Adrian Gray says he believes the Chinese government will dampen down that country's construction sector, further reducing demand for New Zealand timber.

Mr Gray says the export log boom is also over and the market is flooded with North American wood.