Forestry South Africa Roundwood Sales Analysis for the 2015 Financial Year Roger Godsmark Forestry South Africa February 2016

Analysis of Roundwood Sales and Income Generated 2015

Salient Points to Note Total of 15 830 000t was up 330 000 tons (+2.1%) on the budgeted tonnage of 15.5mt and 117 000t (+0.7%) up on last year.   Of concern was that after good figures for the first three quarters of the year, sales in the last quarter slumped – being 405 000t or 10.5% below budget. Estimated product sales in 2015 compared to those in 2014. Sawlogs of 4.6mt up 198 000 tons (+4.5%) Pulpwood of 10.3mt down 29 000 tons (-0.3%) Other of 0.8mt down 52 000 tons (-5.8%) Income of R28.0 million was down R183 000 (-0.6%) on the budgeted amount of R28 210 000. Compared to 2014, this represents a R1.5 million or 5.8% increase.

Roundwood Sales by Species 2015 Total Sales – 15 830 000 tons

Roundwood Sales by Product 2015 Total Sales – 15 830 000 tons

Roundwood Sales by Levy Category 2015 Total Sales – 15 830 000 tons

Pulpwood Sales by Species 2015 Total Sales – 10 345 000 tons

Sawlog Sales by Species 2015 Total Sales – 4 636 000 tons

Other Roundwood Sales by Species 2015 Total Sales – 849 000 tons

Sales Comparisons 2015 vs. 2014 Product 2014 2015 Diff tons Diff % Sawlogs: Soft 3 821 046 3 878 185 57 139 1.5% Sawlogs: Hard 616 955 757 967 141 012 22.9% Sawlogs 4 438 001 4 636 152 198 151 4.5% Pulpwood: Soft 1 788 472 1 967 333 178 861 10.0% Pulpwood: Hard 8 585 329 8 377 256 -208 073 -2.4% Pulpwood 10 373 802 10 344 588 -29 214 -0.3% Mng: Timber : 271 290 303 555 32 265 11.9% Poles :Soft 112 853 152 625 39 772 35.2% Poles: Hard 315 067 225 281 -89 786 -28.5% Poles 427 920 377 906 -50 014 -11.7% Woodchips: Soft 123 389 90 624 -32 765 -26.6% Other: Hard 78 958 77 062 -1 896 Grand Total 15 713 359 15 829 888 116 529 0.7%

Roundwood Sales by Contributor 2015 Total Sales – 15 830 000 tons

Roundwood Sales per Month 2015 by Species Highest sales - June 1 484 000 t Lowest sales - December 1 067 000 t

Roundwood Sales per Month 2015 by Product Sales in 2015 117 000 t (+0.7%) higher than in 2014 and 330 000 t (+2.1%) more than budget

Roundwood Sales per Month 2015 Budget vs. Actual Highest surplus - June + 193 000 t Highest deficit - December - 225 000 t

Contributions Generated by Levy Category - 2015 Total Income Generated – R28 027 000

Levy Income Comparison 2015 Budget vs. Actual Income in 2015 R 1 546 000 (+5.8%) higher than in 2014 but R183 000 (-0.6%) less than budget

Analysis of Roundwood Sales and Income Generated 2002* - 2015 * Year in which FSA formed

Roundwood Sales per Year 2002 - 2015 Full levy tonnage increased by 0.2% between 2014 & 2015 Lower levy tonnage increased by 8.4% over same period

Sales Comparisons per Species 2002 - 2015

Roundwood Sales 2002 - 2015 Eucalyptus

Roundwood Sales 2002 - 2015 Softwood

Roundwood Sales 2002 - 2015 Wattle

Roundwood Sale Comparisons per Species 2015 vs. 2014 Down 108 000t -6.6% Up 253 000t +4.3% Down 3 000t -0.4% Overall increase of 117 000 000t or +0.7%

Sales Comparisons per Product 2002 - 2015 Pulpwood growth over period + 24 000 tons + 0.2% Sawlog growth over period + 1 349 000 tons + 41.0% MT & Other growth over period + 152 000 tons + 21.7%

Roundwood Sales 2002 - 2015 Pulpwood

Roundwood Sales 2002 - 2015 Sawlogs

Roundwood Sales 2002 - 2015 Mining Timber & Other

Roundwood Sale Comparisons per Product 2015 vs. 2014 Down 52 000t -5.8% Up 198 000t +4.5% Down 29 000t -0.3% Overall increase 117 000t or +0.7%

Levy Income Generated per Year 2002 - 2015 Levy income in 2015 R1 546 000 (+5.8%) more than in 2014 but R183 000 (-0.6%) less than budget

Levy Income Comparisons 2010 - 2015 Surpluses have only occurred in 3 of the last 6 years. Accumulated deficit over period – R726 000

Sales Tonnage Comparisons 2010 - 2015 Surpluses have occurred in 4 of the last 6 years. Biggest deficit in 2012 – 865 000 tons

Sales Tonnage per Contributor 2015 vs. 2014 Down 144 000t -1.2% Up 209 000t +6.3% Up 52 000t +8.4% Overall increase of 117 000t or +0.7%

Income Generation per Contributor 2015 vs. 2014 Up R217 000 +1.1% Up R525 000 +9.2% Up R115 000 +11.0% Overall increase of R857 000 or +3.2%