Logs are rolling in and shipping out of Port Taranaki in record numbers, and growth is forecast to continue as strong international market conditions boost trade.
A record volume of 357,000 JAS (Japanese Agricultural Standard tonnage) was exported from the port in the 2015-16 financial year, well up on the 209,000 JAS of the previous year. As a result Port Taranaki had an 80% increase in revenue from its log business in the 2015-16 financial year.
“Signs are good for that growth to continue,” Port Taranaki chief executive Guy Roper said. “Our half-year throughput to 31 December is up a third on the same six months last year, and we expect trade could grow by as much as 10% a year across the next four years.
“This is great news for our business, the customers that use the port and the Taranaki region. The port is an important facility for Taranaki and utilising it to the best of its capabilities is vital for the overall growth and prosperity of the region.”
The forestry industry is enjoying a rise in trade as greater urbanisation in China has resulted in greater demand for wood for housing and infrastructure, while export opportunities are opening up in India, Korea and Japan.
Mr Roper said New Zealand had a “wall of wood” at the moment, as a lot of planting in New Zealand in the 1980s and 90s was now reaching harvest maturity.
“Growth in the forestry business is expected to continue for the next seven-ten years, but that may be followed by a gap of supply due to low levels of planting in the early 2000s,” he said.
“We need to remain aware of that and plan accordingly.”
There is also the need to ensure growth is supported by the supply chain.
“There are problems around the availability of logging crews. It’s an industry concern as fulfilling the demand for product is crucial to maintaining and developing markets.”
Port Taranaki head of commercial Allan Melhuish said the company was focusing on ensuring its forestry customers’ needs were being met.
“Although prices at the wharf gate have been steady, shipping rates have been lower and the exchange rate has been favourable, we have also been competitive and have been capturing the market through our pricing and facilities,” he said.
Mr Melhuish said an increased storage area had been allocated at Port Taranaki’s Blyde terminal, allowing log exporters to store a significant volume closer to the main log berths. Logs are also being stacked higher. There was also the ability to utilise the area in the former power station site for further log storage.
He said the proximity to the berths and log scaling operations had improved efficiencies and reduced supply chain costs for exporters.