The Global Forest Industry in the 2Q/2017

In September 5, 2017

The Global Forest Industry in the 2Q/2017
Excerpts from the Wood Resource Quarterly (www.woodprices.com)

– 30 Years of Global Wood Price Reporting

Global Timber Markets

  • Sawlog prices were up quarter-over-quarter in practically all regions of the world
    in the 2Q/17. The biggest increases were seen in Central and Eastern Europe while
    there were modest price declines in the US South, Coastal British Columbia,
    Quebec and Brazil.
  • Although European sawmills continue to have some of the world’s highest rawmaterial
    costs, the discrepancy between the Global Sawlog Price Index (GSPI)
    and the European Sawlog Price Index (in US dollar terms) has fallen, bottoming
    out in the first quarter of 2017 to reach its lowest level in more than ten years,
    according to the WRQ.

Global Pulpwood Prices

  • Both the WRI global wood fiber price indices inched up in the 2Q/17 because of a
    weaker US dollar and higher prices in the local currencies in many of the 17 regions
    that the two indices are comprised of.
  • In the 2Q/17, the Global Softwood Fiber Price Index (SFPI) was up 0.1% from
    the previous quarter to $85.10/odmt, which was the first qo-q increase since the
    2Q/16. The biggest price increases (in dollar terms) occurred in the US Northwest,
    the Nordic countries, Spain, Russia and Chile.
  • The Global Hardwood Fiber Price Index (HFPI) also experienced a modest
    increase in the 2Q/17, mainly because of higher prices of hardwood pulplogs
    throughout Europe and Russia, as reported in the Wood Resource Quarterly.

Global Pulp Markets

  • Higher pulp production in Latin America contributed to a rise global market pulp
    production by about 0.5% during the first five months of 2017 as compared to the
    same period in 2016. During the same period, production fell in North America
    partly because of the seasonal maintenance downtime at the pulp industry during
    the spring.
  • Strong demand and tighter supply during the spring pushed pulp prices upward in
    Europe, North America and China, with hardwood pulp price increasing the most.
    The price discrepancy between NBSK and BHK has tightened considerably
    compared to 2016.

Global Lumber Markets

  • International trade of softwood lumber is on pace to a new record high in 2017 if
    the trend from the first six months of 2017 continues in the second half of the year.
  • Of the ten largest lumber-exporting countries in the world, Russia, Finland, Austria
    and Ukraine increased shipments the most year-over-year during the first half of
    2017. Russia alone, has accounted for 22% of global lumber trade so far in 2017,
    which is up from 15% ten years ago.
  • During the first five months of 2017, lumber production in the US South bounced
    back after having declined during the second half of 2016. The total production
    output from January through May was 7.3% higher this year as compared to the
    same period in 2016.
  • Lumber prices in both the US and Canada have trended upward for almost two
    years and reached 13-year highs in July.
  • Prices for lumber prices in the Nordic countries continue to be depressed in US
    dollar terms, although they have moved up slightly during the 2Q/17. Current price
    levels are close to the lowest they have been in eight years.
  • Demand for softwood lumber has picked up in China in 2017 with import volumes
    during the first seven months being 16% higher than during the same period in 2016.
    By far, the biggest jump in supply sources has been from Russia.

Global Biomass Markets

  • Global trade of wood pellets has experienced a dramatic growth with a doubling
    of shipments to 16 million tons in 2016. There are four countries, the United
    Kingdom, Denmark, South Korea and Italy, that currently consume almost 80% of
    the world’s traded pellets.

Global timber and wood market reporting is included in the 52-page quarterly publication
Wood Resource Quarterly (WRQ). The report, established in 1988 and with subscribers in
over 30 countries, tracks sawlog, pulpwood, lumber and pellet prices and trade, and
market developments in most key regions around the world.

To subscribe to the WRQ,
please go to www.woodprices.com
Contact Information
Wood Resources International LLC
Hakan Ekstrom
Seattle, USA
info@woodprices.com

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