FEA-Canada Forecasts 1.6% Surge in Global Lumber Output

SEATTLE (Scrap Monster): Russ Taylor, Managing Director  of Vancouver, B.C.-based Forest Economic Advisors LLC (FEA) predicts that global lumber production may likely grow by 1.6% in 2020.

The global softwood lumber production recorded marginal growth by 1% in 2019. Russia achieved production growth of 7%, whereas European production was up by 2%. However, most other regions, including the U.S., China and Japan reported production decline, mainly on account of reduced demand.

Going forward, the U.S. production is expected to witness modest gain of 1.5% in 2020, followed by a 2% gain in 2021. The Canadian production is expected to rise by 1% each in 2020 and 2021, impacted by U.S. lumber duties, reduced timber supply and ongoing mill closures in the B.C. region.

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In 2020, most leading softwood lumber consuming regions are likely to record gains. The U.S. and Chinese consumption may surge by 4% each. FEA predicts moderate consumption growth in Canada. On the contrary, Europe and Japan may see decline in lumber demand. Overall, global softwood demand may see 2.2-2.5% improvement in 2020, as compared with the previous year. The global demand for softwood lumber may witness a much healthier expansion of 2.4% in 2021.

The health of export markets in Asia, the Middle East and North Africa will determine the overall lumber market health in 2020 and 2021, as developments in these markets are critically important.