Russian lumber exports to China surged 81% in April; B.C’s exports slipped

VANCOUVER (Scrap Monster): The latest report released by the International Wood Markets Group suggest significant surge in Russian lumber exports to China during the initial four months of the current year. The exports are up by over 50% during this period in comparison with the corresponding four-month period in 2015. The exports during the month of April alone witnessed sharp rise of nearly 81% from the month before. On the other hand, the B.C lumber exports to China declined by 3% during January to April this year.

The Russian softwood lumber exports to China during the initial four-month period totaled 3.6 million cubic metres, which is almost 50% higher when matched with the exports of 2.4 million cubic metres during Jan-Apr ’15. The exports during the month of April touched record highs of 1.55 million cubic metres, the highest monthly exports to China by any country so far. The Apr ’16 exports were sharply higher by 81% relative to the exports of 853,000 cubic metres during March this year. The reason for the sudden surge in exports is primarily attributed to the spike in activity caused due to temporary disruption in sales to the Middle East and North African markets. In addition, shifting of exports from weaker markets like Egypt has also contributed to the rise in exports, the report noted.

Meantime, the lumber shipments from B.C to China totaled just below 2.2 million cubic metres, marginally down by almost 3% when matched with the previous year. The exports during the month of April alone were down significantly by over 16% year-on-year to 575,000 cubic metres.

According to International Wood Markets Group, Russia has made significant progress in developing supply chains into Asian markets, especially China. On the other hand, B.C is still seen continuing to build on its efforts to make deeper inroads into the region. The lumber producers had started diversifying their export destination since 2008, with the collapse of the US housing market. The lumber sales to China have witnessed steady increase since then. However, the exports have not grown much since 2011.

Softwood Price Index

According to the Wood Resource Quarterly (WRQ), the global wood fiber indices declined sharply during the first quarter of the year. The Softwood Wood Fiber Price Index (SFPI) dropped 1% during the quarter to touch the lowest level since 2006. The softwood fiber prices declined in a number of countries across the world, with Russia, Canada, France and New Zealand reporting the biggest quarter-on-quarter declines. In some markets, prices have shown signs of bottoming out. Only the US South region has witnessed increase in wood fiber costs over the past few years.

The Hardwood Wood Fiber Price Index (HFPI) dropped by 0.6% during the first quarter of the year. Russia, Eastern Canada, France and Germany reported drop in prices of hardwood pulplogs. The Index is currently down by 29% from its record highs in 2011.

About International Wood Markets Group

International Wood Markets Group is a consulting firm of experts specializing in research, analysis and assessments within the operational and marketing areas of the timber and solid wood products industry. Established in 1993, it also provides leading-edge market research and analysis in the form of monthly newsletters and a number of strategic industry, market and product multi-client reports.