1. Report Industry Investment Rating - No industry investment rating is provided in the report. 2. Core Viewpoints of the Report - The weakening fundamentals of logs have been priced in the market, and the current valuation is low. It is expected to fluctuate at a low level [4]. - Log futures are expected to fluctuate at a low level, as the spot price fundamentals continue to weaken, the spot price has dropped to the lowest level of the year, the fourth - quarter shipment is expected to increase, and the median of the December foreign quotation is 116 US dollars [8]. 3. Summary by Relevant Catalogs 3.1 Main Viewpoints and Strategy Overview - **Supply**: From November 24 - 30, 2025, the number of pre - arriving New Zealand log ships at 13 Chinese ports was 6, a decrease of 7 from the previous week, a week - on - week decrease of 54%. The total arrival volume was about 217,000 cubic meters, a decrease of 201,000 cubic meters from the previous week, a week - on - week decrease of 48% [4]. - **Demand**: From November 17 - 23, 2025, the average daily outbound volume of coniferous logs at 13 ports in 7 Chinese provinces was 64,400 cubic meters, a decrease of 1.83% from the previous week [4]. - **Inventory**: As of November 21, 2025, the total domestic coniferous log inventory was 3.03 million cubic meters, an increase of 80,000 cubic meters from the previous week, a week - on - week increase of 2.71% [4]. - **Valuation**: The current log price is lower than the delivery cost, and the valuation is low [4]. - **Investment View**: The weakening fundamentals of logs have been priced in the market, and the current valuation is low. It is expected to fluctuate at a low level. The trading strategy for both single - side and arbitrage is not provided, and attention should be paid to the domestic demand situation [4]. 3.2 Futures and Spot Market Review - **Futures Price**: Log futures fluctuated at a low level this week. The spot price fundamentals continued to weaken, and the spot price dropped to the lowest level of the year. The December foreign quotation had a large span, with a median of 116 US dollars. The fourth - quarter shipment was expected to increase. Overall, the log futures and spot prices were expected to fluctuate at a low level [8]. - **Futures Position**: As of November 28, 2025, the total position of log futures contracts was 24,241 lots, a 2.2% increase from the previous week. The position of the main log futures contract 2601 was 16,638 lots, a 5.4% decrease from the previous week [13]. - **Spot Price**: As of November 28, 2025, in Shandong, the prices of 3.9 - meter small A/medium A/large A radiata pine were 690/750/850 yuan/m³, and the prices of 5.9 - meter small A/medium A/large A were 730/770/940 yuan/m³. In Jiangsu, the prices of 3.9 - meter small A/medium A/large A radiata pine were 690/750/800 yuan/m³, and the prices of 5.9 - meter small A/medium A/large A were 730/770/840 yuan/m³ [14]. 3.3 Log Supply and Demand Fundamental Data - **Import Volume**: In October 2025, China's total coniferous log import volume was about 1.9078 million cubic meters, a month - on - month decrease of 4.67% and a year - on - year decrease of 7.14%. From January - October 2025, China's total coniferous log import volume was about 19.9238 million cubic meters, a year - on - year decrease of 8.04%. In October 2025, China's total coniferous log imports from New Zealand were about 1.4958 million cubic meters, a month - on - month decrease of 0.23% and a year - on - year increase of 12.47%. From January - October 2025, China's total coniferous log imports from New Zealand were about 15.0078 million cubic meters, a year - on - year increase of 1.80% [19]. - **New Zealand Shipment**: In October 2025, about 54 New Zealand log ships left the port, an increase of 8 from the previous month. The total shipment volume was about 2.013 million cubic meters, a 14% increase from 1.766 million cubic meters in September. Among them, 41 ships were sent to China, with a shipment volume of about 1.502 million cubic meters, accounting for 75%, a 2% increase from 1.472 million cubic meters in September [22]. - **Import Cost and Profit**: As of December 2025, the CFR quotation of radiata pine was between 112 - 119 US dollars/JASm³, equivalent to 780 - 825 yuan/m³ in RMB, and the import profit was about - 45 yuan/m³. In November 2025, the AWG price at the New Zealand port warehouse was 126 New Zealand dollars/JASm³, the export cost was about 111 US dollars/JASm³, and the export profit was about 8.8 New Zealand dollars/JAS/m³ [26]. - **Domestic Inventory**: As of November 21, 2025, the total domestic coniferous log inventory was 3.03 million cubic meters, a 2.71% increase from the previous week. The total coniferous log inventory at Shandong ports was 2,065,000 cubic meters, a 5.68% increase from the previous week. The total coniferous log inventory at Jiangsu ports was 831,777 cubic meters, a 0.57% decrease from the previous week [29]. - **Domestic Outbound Volume**: From November 17 - 23, 2025, the average daily outbound volume of coniferous logs at 13 ports in 7 Chinese provinces was 64,400 cubic meters, a 1.83% decrease from the previous week. The average daily outbound volume of coniferous logs at Shandong ports was 35,900 cubic meters, a 2.18% decrease from the previous week. The average daily outbound volume of coniferous logs at Jiangsu ports was 23,600 cubic meters, a 3.28% decrease from the previous week [32]. - **Wooden Square Price and Processing Profit**: As of November 28, 2025, the wooden square price in Shandong was 1250 yuan/m³, with no change from the previous week. The wooden square price in Jiangsu was 1260 yuan/m³, with no change from the previous week. The processing profit in Shandong was - 3.8 yuan/m³, with no change from the previous week. The processing profit in Jiangsu was - 9.2 yuan/m³, with no change from the previous week [35].

Group 1: Report Summary - The report focuses on the log market, covering supply, demand, inventory, price, and cost aspects, and provides trading strategies [3][4][5] Group 2: Investment Rating - Not mentioned in the report Group 3: Core Views - The current log valuation is in a relatively weak range, short - term neutral. Spot prices are stable with some decline in radiata pine. The high New Zealand FOB price may be adjusted, providing limited import cost support. Short - term high inventory and weak demand suppress valuation, but price may stabilize due to factors like traders' price - holding intention, reduced arrivals next week, and restored US log imports. In the long - term, if demand remains weak and North American log supply increases, valuation may stay weakly stable. Further downward price space is limited [4] Group 4: Comprehensive Analysis and Trading Strategies Comprehensive Analysis - Supply: New Zealand log arrivals were 571,000 cubic meters this week, up 16% week - on - week, but expected to decrease next week. US log imports resumed on November 10, supplementing species like Douglas - fir. The New Zealand FOB price in November rose to $115 - 119, but high - price transactions were weak [3] - Demand: The average daily outbound volume of 13 ports was 62,800 cubic meters, down 2.48% week - on - week. Demand weakened but was above the annual average. Construction site fund availability was 59.82%, up 0.12 percentage points week - on - week, with better improvement in housing projects [3] - Inventory: Total inventory was 2.88 million cubic meters, up 1.41% week - on - week. Radiata pine accounted for 82% and continued to accumulate. Inventory was concentrated in Shandong and Jiangsu ports, with significant regional differentiation [3] Trading Strategies - Unilateral: It is recommended to wait and see, mainly using range - bound operations [5] - Arbitrage: Pay attention to the 1 - 3 reverse spread [5] - Options: Wait and see [5] Group 5: Core Logic Analysis - The current log valuation is short - term neutral. Spot prices are stable with some decline in radiata pine. The high New Zealand FOB price may be adjusted, providing limited cost support. Short - term high inventory and weak demand suppress valuation, but price may stabilize due to traders' price - holding intention, reduced arrivals next week, and restored US log imports. In the long - term, if demand remains weak and North American log supply increases, valuation may stay weakly stable. The current price has reflected some negative factors, and further downward space is limited. Attention should be paid to demand recovery rhythm and FOB price changes [4] Group 6: Weekly Data Tracking Log Supply - New Zealand log arrivals in 13 Chinese ports from November 3 - 9 were about 571,000 cubic meters, up 16% week - on - week, a recent high. Next - week arrivals are expected to decrease. New Zealand ports shipped 400,000 cubic meters on 10 ships this week, with 360,000 cubic meters on 9 ships to China. The recovery of US log imports on November 10 will increase North American log supply in the long - term. Currently, North American log inventory is 100,000 cubic meters, down 9.09% week - on - week [12] Log Inventory - As of October 31, total domestic coniferous log inventory was 2.88 million cubic meters, up 1.41% week - on - week. Radiata pine inventory was 2.36 million cubic meters, accounting for 82%, showing an obvious accumulation trend. North American log inventory was 100,000 cubic meters, down 9.09% week - on - week. Shandong and Jiangsu ports had concentrated inventory [12][15] Log Demand - As of October 31, the average daily outbound volume of 13 ports was 62,800 cubic meters, down 2.48% week - on - week, indicating weakening demand. Shandong's average daily outbound volume decreased by 9.89%, while Jiangsu's increased by 4.29%. As of November 4, construction site fund availability was 59.82%, up 0.12 percentage points week - on - week, but the improvement has not fully affected log procurement [21] Log Price - In Shandong, the price of 3.9 - meter medium - grade A radiata pine in Rizhao Port was 750 yuan/cubic meter, down 1.32% week - on - week and 7.41% year - on - year. In Jiangsu, the price of 4 - meter medium - grade A radiata pine in Taicang Port was 770 yuan/cubic meter, unchanged week - on - week and down 4.94% year - on - year. In Shandong, the price of 11.8 - meter spruce in Rizhao Port was 1,180 yuan/cubic meter, unchanged week - on - week and up 9.26% year - on - year [27] Downstream Timber Price - The mainstream transaction price of radiata pine timber was 1,270 yuan/cubic meter in Shandong and Jiangsu markets. The mainstream transaction price of spruce/white pine timber was 1,830 yuan/cubic meter in Shandong and 1,680 yuan/cubic meter in Jiangsu [32] Import Log Cost - New Zealand's November FOB price was quoted at $115 - 119, up $1 - 2 from October. Most traders thought it was high, and a price cut was possible within the month [38]

Report Industry Investment Rating No relevant content provided. Core Views of the Report - The marginal bullish factors under the influence of shipping sanctions are unstable. If the special port charges are mutually cancelled, the current price of the 01 contract may not support the log valuation and is likely to correct downward. [5] - Seasonal inventory reduction continues, but the downstream processing plants feel the market is not booming. The spot price has not increased, indicating a lack of prosperity in the spot market. [5] - The adjustment of delivery premium and discount in Chongqing and Penglai is unlikely to be realized in the 01 contract. If the impact of port charges fades, it may enter a rhythm of deep discount for delivery in mid - to late December. [5] - The near - term trading logic is that the repair of the discounted basis on the futures market is driven by the bullish factors in the far - term. [6] - The far - term trading expectation is the marginal bullish expectation caused by the increase in import costs or the reduction in import volume due to shipping sanctions, but this expectation has weakened. [8] Summary by Relevant Catalogs Chapter 1: Core Contradictions and Strategy Recommendations 1.1 Core Contradictions - The implementation of the special port charges for US ships since October 14, 2025, has led to a short - term price increase in the market. However, the far - term bullish factors may become unstable as the Sino - US trade consultation in Malaysia from October 24 - 27 may propose a phased solution. [5] - Seasonal inventory reduction continues, but the downstream market is not strong, and the spot price has not increased, indicating a weak spot market. [5] - The adjustment of delivery premium and discount in Chongqing and Penglai is unlikely to be realized in the 01 contract, and it may enter a deep - discount delivery rhythm in mid - to late December if the port charge impact fades. [5] 1.2 Trading - Type Strategy Recommendations - The 11 - contract is expected to enter delivery at a discount, and the 01 - contract is expected to rise and then fall, with a focus on short - selling on rallies. [9] - For basis and calendar - spread strategies, industrial customers can consider buying the basis, and the 11 - 01 calendar spread should be on the sidelines. The short 11 - 01 calendar spread has been stopped for profit, and the covered call strategy for the 01 contract has also been stopped for profit. [14] 1.3 Industrial Customer Operation Recommendations - For inventory management, when the log import volume is high and inventory is at a high level, enterprises can short log futures to lock in profits and make up for production costs, with a 25% hedging ratio and an entry range of 820 - 830. [12] - For procurement management, when the procurement inventory is low, enterprises can buy log futures to lock in procurement costs, with a 25% hedging ratio and an entry range of 780 - 800. [12] Chapter 2: This Week's Important Information and Next Week's Concerns 2.1 This Week's Important Information - Bullish information: Inventory is seasonally declining and at a historical low, and the collection of special port charges is bullish for far - term prices. [15] - Bearish information: Low willingness of buyers to take delivery and high delivery costs for sellers in the delivery process, and there is an expectation of Sino - US trade relaxation in the next week's consultation. [15] - Spot transaction information: The report provides the spot prices and basis of different log specifications on October 24, 2025. [16] Chapter 3: Disk Interpretation 3.1 Price - Volume and Fund Interpretation - The 01 - contract added 4520 lots this week, showing a pattern of breaking through and then rising and oscillating technically. [17] - In terms of the calendar - spread structure, the C - structure deepened this week, with the calendar spread reaching a maximum of - 44 from - 30 last week's close and returning to - 32 by Friday's close. No new positions should be added considering the limited trading days. [19] Chapter 4: Valuation and Profit Analysis 4.1 Valuation - The warehouse - receipt cost in the Yangtze River Delta region is around 831, and in Shandong region it is around 836. The willingness of buyers to take delivery is around 792. When the price approaches the warehouse - receipt cost, it is considered overvalued. [28] 4.2 Import Profit - The import profit has been repaired to some extent. Reducing the proportion of imported materials and increasing the proportion of integrated materials can improve the import profit of the whole ship. [29] Chapter 5: Supply - Demand and Inventory Projection - From October 25 to November 3, 16 ships are expected to arrive at the port, with a total cargo volume of 564,000 cubic meters. The trend of inventory reduction is expected to continue. [35] - As of October 17, the daily average outbound volume at the port reached 63,200 cubic meters, a month - on - month increase of 5,900 cubic meters. [35]