Booming Lumber Prices Drive Sawlog to Fresh Peak Levels

SEATTLE (Scrap Monster): The demand and sawlog values hit the highest levels, mainly driven by record-high lumber prices in North America and Europe, said Wood Resources Quarterly (WRQ) report. The log prices in Nordic countries, the Baltic States, Central Europe, Western Canada and the Western U.S. in their local currencies surged to new highs during Q3 this year.

The sawlog costs in Latvia, Estonia, the Czech Republic, Austria, and Germany surged by 60%-95% over the past one-year period. This has made sawmills in these regions, come of the highest-cost lumber manufacturers across the globe. The principal lumber exporting countries including Finland and Sweden witnessed notable surge in log costs. The lowest wood costs in Europe during the third quarter were recorded in Norway and Sweden.

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The European Sawlog Price Index (ESPI) surged by almost 50% in one year, hitting new all-time high during the quarter. The Nordic prices increased by 16%, whereas the log costs in the Baltic States and Central Europe were up by 62% and 79% respectively.

The lumber prices reached record levels in the past year. The sawmills were willing to pay prices in order to ensure that they would be able to run at full capacity. However, the dip in prices during summer has resulted in stabilization of log markets during the fall and early winter, WRQ noted.