Global timber market review #22-2015

– The consensus at the International Softwood Conference was that the industry is still dealing with the consequences of global recession in many areas. The international speaker line-up at the recent Amsterdam event highlighted different countries emerging from downturn at different rates. The opening global market presentation from analyst Rupert Oliver of Forest Industries Intelligence clearly showed an industry in overall recovery. “Total softwood trade increased from 275 million m3 in 2010 to 315 million m3 in 2014, with consumption up from 272 million m3 to 313 million m3,” he said. “That’s a significant rebound.” Within these figures the key development was China’s growth. Europe remained the world’s top softwood producer, with 2014 output of 101 million m3, followed by the US and Russia, 95.7 million m3 and 36 million m3 respectively.

– The Softwood Lumber Agreement between Canada and the US expired in October and negotiations have not started for a new trade agreement. The softwood lumber dispute is one of the longest and largest trade disputes between the two countries, with US producers accusing Canada of subsidising soft sawnwood production. The US has shown little interest to sign a similar agreement because current market prices and limited Canadian wood supply have changed the trading environment. The US is Canada’s largest market for softwood sawnwood accounting for 66% of total exports in 2014, which accounts for about one third of total US consumption. The agreement included export charges for Canadian producers. It provided a stable trade environment that ended with the agreement’s expiry, although a clause prevents either country from taking trade action against the other until October 2016.

– New Zealand’s log export prices jumped to 7-month high in November on increasing Chinese demand, the country’s largest customer. The average wharf gate price for NZ’s A-grade logs increased to NZ$92 per tonne from NZ$83 in October, marking the highest level since April, according to AgriHQ’s monthly survey of exporters, forest owners and sawmillers.

– UPM Plywood plans to adjust the production of its Pellos softwood plywood mills due to increased imports of low-priced softwood plywood to Europe, especially from South America.

More detailed review of global market trends of roundwood, lumber, wood panels and pellets as well as news of the Russian timber industry; exclusive articles and interviews; over 25 pages of price charts are available in our digital Russian Timber Journal.