The log market in Japan is reportedly weakening with log prices falling by between 50-100 yen per koku. For once in a long time the plywood market has firmed for domestic production and with log prices softening, plywood mills see a favorable business environment and are seeking further reductions in log prices. Late January and early February prices for Sarawak Meranti regular were yen 6,250-6,300 per koku CIF, 50-100 yen lower than a month ago. A year ago prices were yen 5,050. Today, prices are up more than 20% on the year so it is no wonder plywood mills have been facing very difficult times. Meranti small prices were yen 5,600-5,700 while Super Small were yen 5,400-5,500 per Koku, down due to weaker FOB prices. Log importers say that future prices will depend on FOB prices, exchange rates and ocean freight cost which have been rising rather fast as bunker costs have gone up. With a lack of domestic demand for logs, tropical producers are reportedly easing prices and FOB prices are down slightly with Meranti Regular at about US$149-150. Small Meranti FOB is about US$126, US$2-3 lower than in December. This is a welcome adjustment of prices from the point of view of Japanese importers and plywood manufactures since Meranti Regular FOB prices went up last year from US$115 in January to US$155. FOB Prices for kapur are said to be softening in Sarawak, along with prices for Meranti, but the prices in Japan are unchanged at about yen 6,500-6,600 yen per koku CIF. PNG Taun/Calophyllum log FOB prices for plywood manufacture have also dropped by yen 50-100 yen to around 5,300-5,400 yen per Koku.
