In Jan-Feb 2017, demand for Russian softwood lumber grew 19% to 3.6 million m3

Sales of Russian sawn softwood products to export markets demonstrate strong growth at the beginning of 2017. Traditional seasonal decrease of shipments of sawn wood resulting from the long New Year holidays this year had a slight impact on the dynamics of export volumes. In January-February 2017, the export volume of sawn softwood products from Russia amounted to 3.6 million m3 (+19% YoY) worth $448 million (+20% YoY).

Significant growth of sales was completely provided by the main consumer of Russian sawn softwood products — China, which in the two months of 2017 increased purchases from Russia by 41% to 2.1 million m3. Thus, the share of China in the total sales amount of sawn softwood products from Russia amounted to 58%.

Against the background of the decreasing supply of products on the part of Canadian producers (-6%, 2016 to 2015), Russian sawn wood products are increasingly being used by their Chinese consumers: the sphere of their application is extending, recognizability of the product is growing.

The largest exporters of sawn wood products in February 2017 were Ust-Ilimskiy LDZ (Branch of Ilim Timber in Ust-Ilimsk, Irkutsk region), LDK Igirma (part of GC Russian Timber Group (Russkaya Lesnaya Gruppa), Irkutsk region) and Ustyanskiy LPK (Arkhangelsk region).

Sales of Russian sawn wood products of Siberian spruce (Picea Obovata) from Siberian regions are growing at especially swift rates: in January-February 2017, the export amounted to 335 thousand m3, which is a 77% increase as compared to 2016. The demand for sawn wood products of Siberian spruce for the third month in a row exceeds sales of larch sawn wood products (Larix Sibirica), the demand for which in the two months of 2017 amounted to 238 thousand m3 (+48 YoY).

Favorable situation in the Chinese house building market, growth of sales of furniture and strengthening of CNY against US dollar since the beginning of January 2017 predetermine growth of the price for sawn wood products.

Chinese Caixin PMI and PMI indices in the first months of 2017 remain on relatively high levels (about 52 points), reaching the level of the beginning of 2014 for the first time. Increase of export orders against the background of signs of accelerating growth of the world economy is highlighted. Price growth in the Chinese economy accelerated in January 2017: consumer prices have grown by 2.5% (YoY) (2.1% YoY in December), producer prices — by 6.9% (YoY) (5.5% YoY in December).

Read the detailed report about the situation in export sales markets of Russian sawn softwood products in the latest issue of the WhatWood Monthly Lumber Report.