Forestry analyst forecasts global lumber supply crunch in the near term

Rubber and Wood  |  2013-05-16 02:40:32   |   By

According to leading forestry analyst, the global lumber market may face severe supply crunch in the years to come

VANCOUVER (Scrap Monster) : According to leading forestry analyst, the global lumber market may face severe supply crunch in the years to come.

Russ Taylor, president of consulting firm Wood Markets Group while speaking at the annual Global Softwood Log and Lumber Conference in Vancouver last week stated that Russia and Canada may face timber supply issues. He predicts that the shortage of lumber will escalate to 10 million board-feet by 2020.

The demand for lumber is expected to shoot up by 2016 as US housing sector is expected to show increased momentum. The demand from Asian countries especially China is also expected to reach its peak.

The devastating mountain pine beetle infestation of trees in B.C is believed to cut the supply to a large extent. On top of that, the government policies have placed limit on the area of forest land available for harvesting.

The story of Europe is entirely different. European saw mills are reported to be facing acute shortage of wood. The higher log prices have reduced the profits too. The economic crisis prevailing over the region had its impact on the lumber industry.

The Russian log exports have reduced by over 50%. The export tax imposed by the Russian government has curtailed the exports from the country.

Many saw mills in the BC are gearing up to reap the benefits of the booming US house market. The operating rates which earlier dropped to 50% during the time of global financial crisis are now catching up.