EXPORTS DIP: Photo shows a worker counting logs. Sarawak’s exports to South Korea plunged after the Korean Trade Commission’s decision to impose anti-dumping duties on imports of Malaysian plywood, ranging from five per cent to 38 per cent for three years. — Reuters photo
KUCHING: The recent surge in Sarawak’s plywood export prices by an average of about 50 per cent this month was more than expected in such a short frame of time, highlighted analysts.
According to a report from AmResearch Sdn Bhd (AmResearch) yesterday, the research firm suspected that the surge was caused by the restocking of inventories in Japan and as such, importers were buying ahead for future requirements.
“Japan, the number one importer of Sarawak’s plywood, is buying more in preparation for the reconstruction of Sendal,” the research house noted in its report. Sendal is a Pacific coastal town that was destroyed by the devastating earthquake and tsunami last March.
AmResearch also attributed this increase to the lower production by mills in Sarawak as a result of wet weather affecting log supply and higher demand from traditional buyers in Japan and the US.
In other segments, the report further noted that Sarawak’s log production fell by 28 per cent to 1.81 million cubic metres in the first quarter of the calendar year 2011 (1QCY11) from 2.53 million cubic metres in 1QCY10, while exports dipped by nearly 20 per cent to 588,152 cubic metres (worth RM848 million) in 1QFY11 from 314,276 cubic metres in 1QCY10.
“In 1QCY11, Japan imported about 297,162 cubic metres of logs worth about RM475.8 million, which represented nearly 50 per cent of Sarawak’s total exports,” it added.
Meanwhile, AmResearch revealed that Sarawak’s exports to South Korea (its second highest buyer) plunged a hefty 42 per cent to 91,529 cubic metres, which went down after the Korean Trade Commission’s decision to impose anti-dumping duties on imports of Malaysian plywood, ranging from five per cent to 38 per cent for three years.
For the time being, AmResearch sustained its hold call on local timber players Ta Ann Holdings Bhd and Jaya Tiasa Holdings Bhd, with respective fair values at RM7 per share and RM7.11 per share.