Australia’s trade in wood products has grown strongly since 2012–13. The value of both exports and imports reached record levels in 2017–18 and total merchandise trade (exports plus imports) reached a record $9.2 billion.
Australia is a net importer of wood products in value terms and this is reflected in the types of products imported and exported. Australia tends to import lower volumes of more processed and higher value wood products to supplement domestic production and meet domestic demand, particularly for construction applications.
By contrast, Australia tends to export higher volumes of less processed and lower value wood products. Factors that influence Australia’s wood products markets overseas include international and country-specific economic drivers, such as housing construction (in response to factors such as population growth), income and preferences. Other drivers include production and transport costs, exchange rates, comparative prices of products from competing countries and volumes of supply.
Exports of wood products
The value of wood product exports increased for the fifth consecutive year in 2017–18 by 4.2 per cent to $3.6 billion (from $3.5 billion in 2016–17). Increases in the export value of woodchips, paper and paperboard (in particular, packaging and industrial paper, and newsprint), and roundwood contributed most to the overall growth in export value over the year (Figure 4).
Woodchip exports represent the largest component (over one-third) of Australia’s total exports, by value. The value of woodchip exports reached a record $1.3 billion in 2017–18, a 6.1 per cent increase from the previous year.
The value of paper and paperboard, and roundwood exports also reached record highs in 2017−18. Paper and paperboard exports increased by 5.8 per cent to $962 million, driven by 33.9 per cent growth in the value of newsprint paper exports (to $130 million). Roundwood exports increased by 7.6 per cent to $643 million, driven by 40.5 per cent higher hardwood roundwood export values (to $118 million) (Figure 4).
By contrast, the value of recovered paper and miscellaneous forest products exports decreased in 2017–18. Recovered paper exports decreased by 4.6 per cent to $248 million and miscellaneous forest products exports decreased by 8.2 per cent to $137 million.
Key export destinations
In value terms, Australia’s top export destinations in 2017–18 were China, Japan and New Zealand (Figure 5). Together these countries accounted for 70 per cent of Australia’s total wood product exports.
The value of wood product exports to China reached a record high in 2017–18, increasing by 4.2 per cent to $1.7 billion (from $1.6 billion in 2016–17), and represented most of the growth in total wood product exports over the year. In 2017–18 the total value of exports to China ($1.7 billion) exceeded the total value of imports from China ($1.6 billion). By value, exports to China accounted for 47 per cent of Australia’s total wood product exports, 59 per cent of total woodchip exports and 96 per cent of total roundwood exports in 2017–18.
Japan was Australia’s second-largest wood products export destination in value terms in 2017−18, with $510 million of total exports (up 11.1 per cent from $459 million in 2016–17). By value, exports to Japan consisted almost entirely of woodchips (97 per cent) and accounted for 14 per cent of Australia’s total wood product export value and 37 per cent of total woodchip export value in 2017–18.
Exports to New Zealand increased by 3.2 per cent in 2017–18 to $337 million and accounted for 9 per cent of Australia’s total wood products exports by value. Paper and paperboard ($221 million) and paper manufactures ($70 million) were the main commodities exported to New Zealand. Exports of these commodities to New Zealand accounted for 23 per cent of Australia’s total paper and paperboard export value and 59 per cent of Australia’s total paper manufactures export value in 2017–18.
In value terms, Australian wood products exports to Malaysia also increased in 2017–18, by 30.8 per cent to $116 million.
Imports of wood products
The value of wood product imports increased by 8.1 per cent in 2017–18 to $5.6 billion (from $5.2 billion in 2016–17). The value of all major wood product import categories increased. Increases in the import value of miscellaneous forest products and wood-based panels contributed most to the overall growth in import value over the year (Figure 6).
The value of miscellaneous forest product imports reached a record of around $1.5 billion in 2017−18 (Figure 6), increasing by 11.2 per cent, driven by increases in the value of builders’ carpentry, mouldings and essential oils. The value of wood-based panels imports reached a record high, increasing by 25.3 per cent to $684 million. Growth of 28.6 per cent in the value of plywood imports (to $449 million) drove this increase, while the import values of particleboard, medium density fibreboard and other panels also increased.
Increases in the value of sawnwood and pulp imports also contributed to the overall increase in total import value in 2017–18. Sawnwood imports increased by 21.1 per cent to $451 million, driven largely by higher softwood sawnwood values (up 27.5 per cent to $372 million). Pulp imports increased by 20.9 per cent to $260 million.
The value of paper and paperboard imports increased by 0.4 per cent to $2.1 billion, driven by 4.0 per cent growth in packaging and industrial paper imports (to $917 million). The value of paper manufactures increased by 0.8 per cent to $653 million.
Key import sources
Australia imports wood products from a broader range of countries than it exports wood products. In value terms, almost half of Australia’s total wood product imports in 2017–18 were from China, New Zealand and Indonesia (Figure 7).
The value of imports from China increased by 8.2 per cent to $1.6 billion in 2017–18 (from $1.5 billion in 2016–17). Increases in the value of wood-based panels (up 28.6 per cent to $234 million), miscellaneous forest products (up 7.4 per cent to $423 million), and paper and paperboard (up 5.0 per cent to $593 million) contributed primarily to this growth. In 2017–18 China accounted for 28 per cent of Australia’s total wood product imports, 28 per cent of total paper and paperboard imports, half of total paper manufactures imports and 29 per cent of total miscellaneous forest products imports.
New Zealand was Australia’s next largest wood products import source in value terms in 2017−18, with $628 million of total imports (up 0.9 per cent from $622 million). Miscellaneous forest products ($162 million), paper and paperboard ($152 million) and sawnwood ($116 million) were the main commodities imported from New Zealand.
Total wood product imports from Indonesia fell to $443 million in 2017−18 (down 1.0 per cent from $448 million). As with imports from China, the main commodities imported from Indonesia were miscellaneous forest products ($248 million), paper and paperboard ($91 million) and wood-based panels ($63 million).
Australian wood products imports from other countries increased in 2017−18, including from Malaysia (to $321 million), Germany (to $179 million), Finland (to $171 million), Canada (to $117 million) and the United States (to $391 million).