Futuris Corporation subsidiary, ITC Ltd, together with Timbercorp Ltd, have negotiated a record increase in the benchmark sale price of certified plantation grown hardwood woodchip with the Japanese.
The negotiations were undertaken by Plantation Pulpwood Exports, 50:50 a joint venture woodchip marketing entity between ITC and Timbercorp.
An agreed price of AUD$207.40 per bone dry metric tonne, free on board, was achieved for certified plantation grown E.Globulus exported from Albany, Australia, a 10 per cent increase on the 2007 benchmark of $189.40 per BDMT.
ITC chief executive Vince Erasmus, who led negotiations on behalf of PPE, said the increase of AUD$18.00 per BDMT was the most significant price rise secured for Australian hardwood plantation woodchip in 25 years and the second consecutive annual increase in real terms.
"These outcomes highlight the growing strategic significance of Australian forestry production for Asian commodity markets."
Timbercorp executive director John Vaughan said the increase reflected continued demand growth for Australia's premium quality, sustainable forest products and was good news for investors in the companies' forestry projects.
"The negotiations were conducted in the context of a tighter global supply outlook and the outcome achieved reflects this market view," he concluded.
The agreed price will apply to all certified plantation grown woodchip exports for 2008 from Albany, Australia, backdated to January 1.
