WRI Market Insights: International lumber markets update

January 21, 2021

By: The Working Forest Staff

WRI — The United Kingdom is the largest importer and the second-largest consumer of softwood lumber in Europe. In 2019, the country imported 6.7 million m3, which was a y-o-y decline for the second consecutive year. Although lumber imports showed a substantial increase in the 3Q this year, the first nine months’ total volume was still 22% below the same period in 2019.

Shipments from Sweden, the largest lumber supplier to the UK, have fallen less than imports from other countries, including Latvia, Finland, Russia, and Germany. Import prices were generally higher in the fall than earlier in the year.

 Lumber Markets – China Lumber imports to China slowed in the 3Q/20, with total volumes falling 2% from the previous quarter and 4% from the 3Q/19. Total imports for the first nine months were 10% below the same period in 2019, according to the Wood Resource Quarterly.

China’s two largest supplying countries, Russia and Canada, collectively account for roughly two-thirds of total imported softwood lumber. They both lost market share in 2020.

 Predominantly European suppliers, including Ukraine, Sweden, Germany, Finland, and Belarus, have been increasing their presence in China to fill the need for wood in the world’s second-largest market this year.

Despite the reduced demand for lumber, import prices have moved up this year and in the third quarter were the highest they have been in two years. Russian prices were close to a record high. Russian lumber is also the supply source that has increased the most in price the past year.

 Lumber Markets – Japan Lumber imports to Japan fell by almost 10% during the first nine months of 2020 compared to the same period in 2019. The y-o-y changes were mixed for the four leading suppliers, with Canada, Finland, and Russia reducing shipments to Japan, while Sweden increased export volumes by 19% this year. Importation from smaller suppliers such as Austria, Chile, the United States, the Czech Republic, and Germany have fallen by 10-35% in 2020.

 Import prices have slowly trended downward the past two years, with the average price in the 3Q/20 being 13% lower than in the 3Q/18. According to the Japan Lumber Journal, the most significant changes from September 2019 to September 2020 were an increase of Canadian hemlock prices by 15% (in Yen terms) and the decrease in European whitewood prices by about 13%.

For more insights on the latest international forest product market trends, please go to www.WoodPrices.com

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