-- Delivered by Feed43 service
LINX Cargo Care Group, and its subsidiary C3 Limited, has announced that it has been successful in its bid to acquire Pedersen Group, a market leading provider of wood chipping and woodyard management services to pulp and paper mills, and forest owners in Australia and New Zealand.
Pedersen Group handles over 8.3 million tonnes per annum of wood fibre across its operations, in the form of logs, wood chip and hog fuel. The company employs 140 people across Australia and New Zealand and has an existing joint venture with C3 Limited, which provides wood yard management services to customers.
LINX Cargo Care Group is delighted to enter into a purchase agreement with Pedersen Group and take the next step in the evolution of both companies, which is expected to be completed mid-August.
Pedersen Group CEO Gavin Hudson said the conditional agreement reached this week will provide the Pedersen Group with an aligned and committed long-term owner, which will enable Pedersen Group to continue to focus on providing critical services to its customers.
“We are delighted to finalise this agreement with LINX Cargo Care Group. The acquisition of Pedersen Group by LINX Cargo Care Group will provide long-term stability for our employees and customers, and the operational and financial capacity to allow our business to pursue its growth aspirations”, Mr Hudson said.
Anthony Jones, Group CEO for LINX Cargo Care Group and Chairman of C3 Limited said the acquisition of Pedersen Group brings a complementary service offering to customers, including a highly skilled workforce who specialise in wood chipping and woodyard management.
“LINX, C3 and Pedersen share a long and rich history in the forestry industry. Our combined expertise and experience will provide an enhanced customer offering, further access to capital, and the opportunityto collaborate and collectively grow into the future,” he said.
“We are very excited to welcome Pedersen Group to LINX Cargo Care’s group of companies. Pedersen’swill enable our organisation to grow its services to forest owners and wood processing businesses. In addition, Pedersen’s capabilities and services complement C3’s existing customer offering and willextend our reach to a customer base in diversified global markets.
“The synergies and strategic alignment between Pedersen’s and C3’s forestry business is significant. Importantly, our company values are closely aligned, and we very much look forward to welcomingPedersen’s talented and highly skilled workforce to the team,” Mr Jones said.
Pedersen Group will continue to operate independently under the Pedersen brand following the completion of the acquisition, and all Pedersen employees will be retained by the new owner.
The Indian log market has reached China price parity with ‘A’ longs now selling for USD 159-160/JASm3. While volumes delivered to this market are 14% down year on year to May 2018, it has been a steady market and exporters still expect an increase in demand in Q4.
There is an increased schedule of ship arrivals from NZ over the next six weeks, so this will be a good test of this market. Containers of logs are also arriving from Germany, South Africa and southern yellow pine from the USA.
The labour shortage mentioned in previous Wood Matters continues, but some labour has returned to the mills from agricultural work. Log stocks are about 120,000m3 in Kandla and 30,000m3 in Tuticorin. The cash flow of log buyers is still tight after the introduction of GST and the increased scrutiny on bank lending compounding the weakening of the Indian Rupee against the US dollar.
Source: PF Olsen Wood Matters
The domestic market is still relatively flat for structural sawn timber and there are a few mills around the country reducing production slightly by undertaking maintenance etc. Sales of clear-wood timber are still relatively strong, with stable domestic demand and very strong demand from export markets.
The PF Olsen Log Price Index remained at $132 for July. While prices for pruned logs decreased in a couple of regions around the country, this was balanced by an increase in sale prices for structural logs, as well as pulp logs in the CNI. The index is currently $11 above the three-year average.
Domestic Log Market
Mills report that their markets are the same as last month with good demand for clear-wood sawn timber. Domestic demand has been steady and export markets have been very stable with increasing demand due to strong construction figures in both Europe and the USA. Some mills are actually oversupplied with pruned logs and are having to limit log supply, as many forest managers have scheduled winter harvesting in the flatter blocks with easier access that tend to be pruned.
The domestic demand for structural timber is still flat. Actual housing starts in New Zealand seem to be about 20% behind consents granted. Market commentators aren’t too sure of the reason(s) why this is the case. Many mills in NZ aren’t “busting a gut” with production and some are taking extra days off for worker rotation and maintenance etc.
Overseas, the prices for lumber in Maine, USA have doubled in the last six months. The US construction industry has rebounded with pent up demand for new houses and renovations after the recession and rebuilds and renovations required after recent hurricanes and other weather events that require. This surge in demand has coincided with a restricted supply of lumber. This restricted supply is caused by a combination of some significant forest fires in western Canada last year that caused some mills to close for two months, the trade dispute between the United States and Canada, and a shortage of railcars and trucks to move the product.
The European Organisation of the Sawmill Industry (EOS) held its Summer General Assembly in Oslo in June. Their softwood sawn-wood markets were in general described as ‘rosy’ due to healthy construction in Europe and lively demand from importers with the two main markets being the US and China. Collectively their main concerns were around log supply (Sound similar to NZ?). This lack of raw supply is even more pronounced for hardwood mills as hardwood logs are exported to China. (As an example, in 2013 the EU exported 200,000m3 of oak logs to China, and in 2017 exported 600,000m3). These factors indicate there is unlikely to be any significant increase in production and export to countries to which NZ sawmills export sawn timber. European sawmills actually see a window of opportunity to supply the US.
Exporters of NZ sawn timber have not yet seen any reduction in demand from China due to the weakening of the Chinese Yuan (CNY). The chart below shows the deprecation of the CNY against the YSD over the last month.
Report: Scott Downs Business Development Manager PF OLSEN
Södra reported sustained strong operating profit of SEK 1,318 million ($149 million) for the 2Q, the best quarterly result ever. The market trend was positive for all of the company product categories and completed investments, efficiency improvements and restructuring are reflected in the result.
Consolidated net sales for the 2Q rose 26% year-on-year to SEK 6,626 million ($751 million), and the operating margin strengthened to 20%. For the first half-year, operating profit totalled SEK 2,257 million ($256 million) – the strongest half-year figure in Södra’s history. Return on capital employed rose to 26% and the equity ratio was 57%.
In the Södra Skog business area, operating profit totalled SEK 49 million ($5.6 million) for the period. The result was impacted by continued weather challenges. Following a cold and snowy winter that made transportation difficult, the dry conditions of recent months have increased the fire danger and significantly impacted forest operations.
In the Södra Wood business area, operating profit totalled SEK 210 million ($23.8 million) for the period, mainly reflecting the positive price level for sawn timber but also the ongoing restructuring process. The result refers solely to the sawmill operations, since the Interior Wood segment has largely been discontinued and is now reported under Other segments.
In the Södra Cell business area, operating profit totalled SEK 1,196 million ($136 million) for the 2Q. The profit trend was mainly attributable to the high price level, a favourable USD exchange rate and the higher volumes enabled by expansion of the pulp mill at Värö.
In the State of Mato Grosso, Brazil, there are some 3.2 million hectares of sustainably managed forests and this is expected to rise to 6 million hectares by 2030, as ITTO reports.
In all 44 municipalities in Mato Grosso the domestic economy is driven by the forestry sector which ranks 4th amongst all economic sectors. In 2017 the forestry sector contributed more than R$47 million ($12.6 million) in taxes and over R$16 million ($4.3 million) towards the State Fund for Transportation and Housing (FETHAB).
Forest management in Mato Grosso is very complex and involves compliance with numerous regulations. In addition, authorisations and supervision of forestry activities, including harvesting, transportation and trade, involves several government agencies and the Brazilian Federal Highway Police making management overly bureaucratic.
The post Brazil: Mato Grosso to double forest management area by 2030 appeared first on International Forest Industries.
Sveaskog’s 2Q 2018 net sales rose to SEK 1,918 million ($216 million), an increase of 13%. Sales of wood raw material amounted to 2.9 million cubic metres.
Operating profit from continuing operations increased by 12% and amounted to SEK 382 million ($43 million). The improvement in earnings is mainly an effect of higher prices. Difficult soil scarification and planting conditions led to a lower level of silvicultural activity. This had a negative effect on external sales of seeds and seedlings.
Profit for the 2Q 2018 increased by 108% and amounted to SEK 914 million ($103 million). New corporate tax rules resulted in lower deferred tax and therefore a lower tax expense which improved earnings by SEK 477 million ($53.7 million).
1H 2018 net sales, which comprise both deliveries from Sveaskog’s own forests and externally procured wood raw material, increased by 8% to SEK 3,567 million ($402 million). Sales of wood raw material amounted to 5.8 million cubic metres.
Operating profit from continuing operations increased by 7% and amounted to SEK 775 million ($87.3 million). Higher prices were offset to some extent by a 7% decrease in delivery volumes from own forests.
The main cause was the extremely snowy winter and record-dry early summer which had a negative impact on felling, soil scarification, planting and external sales of seedlings and seed. This has led to a delivery mix with a lower proportion of deliveries from own forests. On an annual basis, the delivery mix is expected to normalize.
Profit for the first six months of 2018 increased by 67% and amounted to SEK 1,301 million ($146 million).
Sveaskog is Sweden’s leading forest company and sells sawlogs, pulpwood, biofuel, forest seedlings and silvicultural services.
West Fraser Timber Co. Ltd. reports 2Q 2018 sales of $1,834 million, compared to $1,322 million in the 2Q 2017. Adjusted EBITDA was $593 million, compared to $305 in the 2Q 2017.
Lumber segment generated operating earnings of $358 million and Adjusted EBITDA of $467 million. Improved product pricing and increased shipments of 416 million board feet were largely responsible for the improved results. Countervailing and antidumping duties charged in the quarter were $81 million, of which $68 million was recorded as export duties expense in the earnings statement and $13 was recorded as a long-term duty receivable on the balance sheet.
Panels segment generated operating earnings in the 2Q 2018 $52 million and Adjusted EBITDA of $56 million. Improved plywood pricing and higher shipments boosted results.
Pulp & paper segment generated operating earnings of $56 million and Adjusted EBITDA of $68 million. Higher pulp prices were offset by lost production from a planned maintenance shutdown at Cariboo NBSK mill, transportation related production curtailments at Quesnel BCTMP mill, and a series of operational challenges at Hinton NBSK mill.
West Fraser is a diversified wood products company producing lumber, LVL, MDF, plywood, pulp, newsprint, wood chips and energy with facilities in western Canada and the southern United States.
The post West Fraser Timber reports 2Q Adjusted EBITDA of $593 million appeared first on International Forest Industries.
Tigercat has announced Mark Tourand has been appointed to the position of product support representative for British Columbia.
Tourand will be primarily involved with product support for Tigercat’s extensive customer base in western Canada.
Based in Merritt, British Columbia, Tourand has been involved in the equipment industry for over 25 years, previously working as a heavy-duty equipment technician in the manufacturing industry. he also has experience in the forestry and mining sectors.
“Along with Kushiah McCullough and Damien Donoher, I am very excited to add Mark to the support team for western Canada and the United States. We continue to have many new opportunities and applications for Tigercat machines. With new innovation and increased productivity comes increased complexity of machines. The importance of a top-notch support team is critical,” explains Rob Selby, Tigercat District Manager, also based in BC.
Tourand has strong technical knowledge related to diesel engines and electronic systems with professional training in power generation and diesel electric systems. He also has his Red Seal certification as a heavy-duty equipment technician.
“I am extremely excited to join an innovative and cutting edge team like Tigercat Industries. I am looking forward to supporting our dealers and customers in the west,” says Tourand.
The post Tigercat – More Factory Support For British Columbia appeared first on International Forest Industries.