In the United States lumber market, a ratio of lumber futures prices to gold futures prices is often used to gain insights into broader economic trends, investment strategies, and market behaviours. Gold is widely regarded as a reliable store of value over the long term and serves as a hedge against inflation driven by depreciating […]
Rob de Fégely, co-founder and director of Margules Groome, will retire on 30 June 2024. Rob’s career in consulting began in the 1980s when he joined Ray Margules, a pioneer in forestry consulting in Australia. Over the past four decades Rob undertook a countless number of consulting assignments for both the private sector in Australia […]
The latest edition of the index indicates margins moved slightly up in the March quarter 2024, following stabilisation in the December quarter 2023. Logistics costs decrease in line with moderating fuel prices was the main driver. Log prices remain flat to slightly declining over the March quarter 2024, although in reality forest owners would be seeing the peak in March as the delayed price increases from 2023 show. It is expected that log prices will continue their downward trend during 2024 and into 2025 following timber prices, but they will not fall as much as in past cyclic downturns.
Margules Groome’s quarterly harvest and haulage cost index for Australian plantation operations is based on price indexation mechanisms used by the industry, weighted by volume harvested (Figure 1). The index held its flat trajectory in the March quarter 2024 continuing its slightly downward trend from the recent September 2023 peak. Again, lower fuel prices were the key driver, outweighing increases in wages and CPI measures.
Forestry carbon investments have developed to become an important facet of the forestry landscape in New Zealand as investors have sought to jump on the bandwagon to decarbonise. For many investors it is an economic play where they are seeking to make economic profits as well as potentially offsetting carbon liabilities elsewhere.