Global softwood lumber trade down 7% in 2018

Wood Resources International LLC
April 25, 2019
By Wood Resources International LLC
Global softwood lumber trade fell seven per cent in 2018, U.S. lumber prices took a roller coaster ride and China’s wood demand slowed in the 2H/18, reports the Wood Resource Quarterly.

In 2018, global trade of lumber fell for the first time in five years, with total trade down seven per cent year-over-year. The four largest importing countries, the US (down 18 percent), China (down 5 percent), the United Kingdom (down 13 percent) and Japan (down 6 percent) all imported less in 2018 than in the previous year. Much of the decline was the result of weaker economic prospects and reduced housing starts.

U.S. lumber prices have gone through a historical roller-coaster ride over the past 12 months. Random Lengths’ composite index for southern yellow pine was at $420/m3 in January 2018, peaked at $554/m3 in June and fell to $372/m3 in January 2019.

2018 softwood lumber exports from Canada were down five per cent from 2017, with the biggest decline being in shipments to China. A three-year high of 80 percent of total exports were destined for the U.S. market in the 3Q/18 despite efforts by Canada’s lumber industry to diversify its export shipments. China’s share has fallen from 13 percent in 2017 to 12 percent in 2018. The average export price from Canada declined by 28 percent this fall.

Sawmills in the Nordic countries had a very good second half of 2018 with lumber prices in the local currencies reaching their highest levels since 2007. Because of the weakening Euro and the Swedish Krona, prices in U.S. dollar terms fell to their lowest levels in almost a year, with average prices in November for Finland and Sweden being $240/m3 and $260/m3, respectively.

Global lumber, sawlog and pulpwood market reporting is included in the 56-page quarterly publication Wood Resource Quarterly (WRQ). The report, which was established in 1988 and has subscribers in over 30 countries, tracks sawlog, pulpwood, wood chip, lumber and pellet prices, trade and market developments in most key regions around the world.

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