Log exports from US West Coast drop sharply

SEATTLE (Scrap Monster): The log shipments out of West Coast docks have reported sharp decline during this year. The demand from China- the primary destination of US lumber exports has slowed down significantly. Chinese importers have turned to Russia and New Zealand as rising strength in US dollar makes trade with the US less profitable for them. Consequently, harvest levels have also reported huge declines.

The log export market has been going through a rough patch for some time now. However, upbeat domestic log demand had been easily compensating for the continuing drop in exports. Currently, domestic demand has also started to wane, noted industry participants. According to statistics, the log export from the Port of Longview totaled 29.43 million board feet during the first quarter of the current year, 45% lower when compared with the exports during the corresponding quarter last year.

The export data released by the US Forest Service indicates that log exports dropped sharply by 20% in 2014, in comparison with the year before. The lumber and log exports from Washington, Oregon, Northern California and Alaska declined 13% year-on-year in 2014.

Despite the recent rise in Russian Ruble, export trade with US continues to remain expensive on account of rising strength in US Dollar. This has forced many Chinese importers to switch to Russia and New Zealand to meet their import requirement. Also, slowdown in Chinese housing sector has led to increased imports by China, which in turn has contributed to the substantial decline in log export volumes from US West Coasts.

The industry anticipates phenomenal recovery in US housing starts. This would propel the demand for finished wood products. As a result, more logs will land up in domestic sawmills rather than being exported to Asian destinations. The stability in US housing sector may lead to higher log prices, going forward.