Processing and Marketing Timber Clears NZIF Conference 2016

Executive Summary Sawmillers are constantly improving their conversions > Cutting patterns and methods > CRI versus PLI KPIs track progress > Green Sawn Realisations models profitability by log source More efficient pruned log conversion equates to better pricing Markets are more stable than they have been dominated by: 1.USA Board Market 2.European Chemical Modification 3.Asian Manufacturing 4.Domestic Market Domestic Sawmilling of pruned logs looks competitive for the foreseeable future

Sawmillers’ view of Pruned Log Quality PLI is the traditional and “absolute measure of pruned log quality” CRI = %Outturn of [Clears, #2 Clears & Dressing] % of pruned logs consumed By log source By production shift Weekly and Monthly Over several months, even years

Green Sawn Realisations (GSR) Need to understand where money is made or lost especially when cutting from multiple sources Maintain log source identity Maintain timber grade identity for pricing

Conversion of Pruned Logs Optimisation Technology CRI and GSR performance is tracked when developing testing and deploying these cutting strategies and technologies

Market Doldrums Clear markets have been depressed for a period Rise of Chilean volume Use in long length mouldings diminished due to substitution by primed MDF, finger jointing, low European exchange rate Availability of cheap labour

US Board Market Retail Product Southern Yellow Pine, Eastern White Pine and Ponderosa.

Chemical Modification Kebony & Accoya currently dominate

Chemical Modification Modified Radiata can be used to substitute for some suspected illegal wood based products Comparison between estimates of the roundwood equivalent volume of illegal wood-based products directly imported from producing countries by China and specific other countries Note: this excludes those other countries' imports from China. Source 9

Domestic Market Varied applications Small order quantities but important

Asian Markets China alone is a big market Flexible sizes

Is there a future in pruning? More efficient pruned log conversion equates to better pricing Markets are more stable than they have been dominated by: 1.USA Board Market 2.European Chemical Modification 3.Asian Manufacturing 4.Domestic Market Domestic Sawmilling of pruned logs looks competitive for the foreseeable future