Global softwood lumber trade continued uptrend in 2014

VANCOUVER (Scrap Monster): Majority of key lumber exporting countries in the world increased their exports during the year 2014. Export volumes of these countries were up anywhere between 5% and 8% during the year. Canada, Russia and Nordic countries reported higher export volumes. On the other hand, Austria, the U.S., New Zealand and the Czech Republic witnessed decline in softwood lumber exports. The strength in US Dollar coupled with market weakness in Europe and Asia led to decline in lumber prices towards the end of the year.

Lumber consumption by the US improved 6.9% in 2014, mainly on account of rise in consumer confidence and visible improvements in the country’s housing market. Higher demand led to improved production levels at Western and Southern sawmills. Meantime, lumber production dropped in the B.C area. The prices of southern yellow pine remained in the range between $198/m3 and $284/m3 during the past two years.

The weakness in export market resulted in sharp fall in lumber prices in Sweden and Finland during H2 2014. The lumber market ended in a surplus due to Nordic countries declining to cut back production despite reduced demand from overseas markets. Consequently, lumber prices saw sharp cut of almost 13% during the fall.

The higher tax rates introduced by Japanese administration impacted the country’s housing market. The wooden housing starts plunged by 11% during 2014. The huge fall in demand affected lumber production in the country. The lumber imports by the country too declined considerably during the year. The lumber prices witnessed sharp cuts on account of weaker yen.

In China, the demand for lumber weakened during the second half of the year. The imports during Q4 2014 fell nearly 9% from the previous quarter. When compared with Q4 2013, the softwood lumber imports by China were down 6%. The average import prices remained mostly flat during 2014.