3/28/2008
Significant Increases in Chip Costs for Western US.
Statistics from the Wood Resources Institute show a 12% increase in US SW chip prices for export to Japan, and a corresponding 18% increase in Canadian prices for the same. In part a response to the overall lumber production decline, industry analysts note that Japanese buyers will either have to accept higher prices for residual chips or seek a higher fraction of chips produced from round wood. Observers also note that rising chip prices in Australia/New Zealand have already shifted demand towards the US over the last year, limiting the ability of other producers to capitalize on this price shift.
3/27/2008
Housing Starts Not Expected to Recover in 2008.
The Charlotte Observer quotes an estimate by the Building Materials Reuse Association that the number of businesses involved in salvage for resale has doubled in the last ten years to 1200 firms. They note in particular the shift in the reclaimed materials market from repair and remodel use to new and custom home construction, as well as increased interest in green construction practices.
3/17/2008
Declines Seen in Plywood Exports from China.
The ITTO notes that the withdrawl of tax benefits for exporters in China is impacting plywood exports, particularly for small mills. Additional factors factors noted in this decline include the availability of raw materials, increasing labor and fuel costs, and problems with sourcing certified feedstocks for export to European markets. While an increase in fuel costs will affect all markets, US producers who can supply certified products should look to Europe, particularly while the dollar remains weak.
3/6/2008
Large Log Prices Fell, Pulpwood Rose in 2007.
The University of Georgia’s measures of economic activity show a decline in large log prices for Southern pine. The impact of this on landowners was somewhat offset by strong international demand for pulpwood, which was itself bolstered by the falling dollar. Of particular note was the impact on mill owners, as the fall in the price of timber lagged the fall in the price of lumber, squeezing operating margins..
3/5/2008
Boom in Reclaimed Wood and Salvaged Building Materials.
The Western Wood Products Association, cited in the Prince George Citizen, estimate that housing starts in 2008 will not exceed 970,000, just half the numbers attained in 2005 and the worst new construction year since WWII. They note that this decline is greater still in the single family home sector, off 60% from the 2005 peak. Sector analysts increasingly agree that a turnaround will not occur until 2009.
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