Manufacturing volumes up, but wood workers worried

Friday 1st April 2011

The volume of manufacturing sales rose in the three months to December following three quarters of decreases, yet the union representing wood processing workers warned of further job losses in its industry.

Overall, the seasonally adjusted volume of manufacturing sales rose 3.3% in the December quarter from the previous three months, Statistics New Zealand said.

Meat and dairy product volumes were up 7.9% but wood and paper product manufacturing volumes fell 4.2%, and textile, leather, clothing, and footwear manufacturing was down 5.7%.

The volume of manufacturing sales trend has generally been in decline since the December 2007 quarter.

The volume of sales, excluding meat and dairy product manufacturing, rose 0.5% in the December 2010 quarter, following two consecutive quarters of decline.

The volume of sales for the wood and paper product manufacturing industry has fallen for three consecutive quarters. Volumes for the industry have fallen 6.8% since the March 2010 quarter.

The union for wood processing workers today sounded an alarm at the data, saying further jobs will be lost from an industry that has shed 1129 jobs since 2008.

The price of A grade unpruned logs has risen to between NZ$125 per tonne and NZ$130 per tonne from around NZ$60 per tonne in 2008, which is too expensive for local wood processors.

"These prices may be great for the raw exporters of logs, but they are unsustainable for New Zealand value-added wood processors," National Distribution Union general secretary Robert Reid said.

"Even at the first quarter 2011 price of NZ$100 per tonne, many wood processing companies told us that they will have to cut back production and lay off workers if the log price does not return to a realistic level."

Manufacturing values were up 3.1%, with meat and dairy up 7.3%, while the rest gained 0.8%.

Metal product manufacturing volumes gained a seasonally adjusted 7% in the December quarter, with the chemical, polymer and rubber product sector up 10.1%, metal products up 7%, the transport equipment, machinery and equipment manufacturing sector rose 2.7%, and beverage and tobacco volumes lifted 4.2%.

Sectors, other than meat and dairy, that contributed to the seasonally adjusted rise in manufacturing sales values in the December quarter, included a 5.5% rise in metal product values and a 7.2% gain in chemical, polymer, and rubber products.

Beverage and tobacco product values gained 4.9% and wood and paper products were down 5.2%.

The volume of finished goods stocks, which was not seasonally adjusted, was 8.8% lower in the December quarter than a year earlier, with the biggest fall being a 36.9% drop in the petroleum and coal industry, SNZ said.

NZPA

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