U.S. South Log Costs Slumped to Lowest Levels
The major lumber producers in Europe reported 15-65% rise in log costs over the previous year.
SEATTLE (Scrap Monster): The Wood Resources International (WRI) Market Insights noted that log costs for sawmills in the U.S. South haven continued to remain at lowest level over the past decade. The demand for forest products is expected to increase, corresponding to the fast growth in population in the Southern states.
The softwood fiber costs for pulp mills in the US South are currently the third-lowest in the world, behind Latin America and Russia. Not only have they been low, but they have also been relatively stable for a long time. The steady trend is in contrast with price trends in other regions such as North America and Europe, where sawlog prices edged higher significantly in Q3 this year, compared to corresponding third quarter in 2020.
The average sawlog prices surged around 50% year-on-year in Western Canada, whereas it was up by 12% in the U.S. Northwest. The major lumber producers in Europe reported 15-65% rise in log costs over the previous year.
The U.S. South region has witnessed significant investments in forest production capacity during recent times. Also, the region has continued to record positive growth-to-harvest ratio, unlike other regions. The U.S. South region has already announced plans to boost its manufacturing capacity, which in turn will reduce dependence on imports and boost export opportunities.
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