New Zealand – Harvest & Haul Cost Index – 2nd Quarter 2024 Update

17th September 2024

This is the second release of Margules Groome’s biannual harvest and haulage cost index for New Zealand plantation operations (Figure 1). The methodology used is similar to Margules Groome’s approach in Australia where we have published harvest and haulage cost indices for almost a decade. The indices are the sum of different weighted economic indicators. The indicator weightings differ for harvesting and haulage.

Figure 1: New Zealand Harvest & Haulage Cost Index June 2024, Nominal

Sources: Infoshare, MBIE, Margules Groome

The indices have never dipped below 100 over the observation period and have shown on average a steady increase prior to COVID. As of December 2020, prices started to increase rapidly. As can be expected, there is a strong correlation with fuel price changes although this is only one of the indicators used in the indexation. Over this same period wages also rose rapidly. In the past two quarters (Q1 & Q2 2024) both the harvesting and haulage indices have started to level off. This is mostly driven by fuel prices that have been dropping over the last three quarters. Inflation is also dropping quite quickly, as was expected. It is forecast to be 3.1% and 2.2% for 2024 and 2025 respectively.

For further information and analysis on the indices, and forestry cost benchmarking, contact Margules Groome.

Our recent work on this topic covers cost components for harvesting, roading and haulage, however the cost items can be tailor-made based on your company’s needs. In addition, our cost benchmark data does not only cover New Zealand but also most of the main forestry regions around the world.

[1] Consensus Economics September 2024