Excerpts from the Wood Resource Quarterly (www.WoodPrices.com)
Global Timber Markets
- A plentiful supply of logs coupled with declining demand moved sawlog prices
downward in most major markets around the world in the 3Q/19. The biggest price
reductions came in Central Europe, where storm-damaged logs flooded the market.
- With falling sawlog prices throughout the world, the Global Sawlog Price Index
(GSPI) took a hit in the 3Q/19 and had its third-largest q-o-q decline in ten years.
- The European Sawlog Price Index (ESPI), which has been in steady decline for
two years, fell another 5.0% in the 3Q/19, as reported in the latest issue of the WRQ.
Global Pulpwood Prices
- Prices for softwood pulplogs and wood chips either remained unchanged or
declined in the 3Q/19 compared to the previous year. The biggest price reductions were
seen in Austria, Germany, and Sweden. The only region with higher prices in the
3Q/19 was Western Canada, where pulplog prices increased by 10% from the
previous quarter. The Softwood Fiber Price Index (SFPI) fell by 2.2% q-o-q in
the 3Q/19 and hit its lowest level in two years.
- The Hardwood Fiber Price Index (HFPI) has been fairly stable over the past two
years. In the 3Q/19, the HFPI experienced a slight decline from the previous quarter
but increased about one percent from the 3Q/18.
Global Pulp Markets
- Pulp prices have continued their decline that started in the 4Q/18. In October, the
NBSK price in Europe ranged from $820-850/ton, down from $1300/ton in
October last year. With pulp inventories coming down to levels similar to last year,
resistance to further price reductions is becoming stronger.
Global Lumber Markets
- Russia has surpassed Canada to become the world’s largest exporter of softwood
lumber in 2019 and is on track to ship almost 32 million m3 of lumber this year,
representing 23% of globally traded lumber.
- Lumber production has fallen in both the US and Canada in 2019 because of
disappointingly low activity in the US housing market and meager demand for
North American lumber in overseas markets.
- Lumber import prices to China have fallen for three consecutive quarters and in
the 3Q/19 hit their lowest level since 2016.
- Germany’s exports of softwood lumber are likely to reach a ten-year high in 2019.
The biggest increases in shipments have been to China, the US, the UK, and India.
- The gross margins for lumber producers in Finland, as reported in the WRQ, have
fallen more rapidly than those of their Swedish competitors during 2018 and 2019.
Global Biomass Markets
- The European Pellet Price Index (EPPI), a weighted import price for industrial
pellets in Europe has trended upward over the past two years to reach over €160/ton
North America exported 2.5 million tons of pellets in the 3Q/19, representing a
6% increase from the 3Q/18. The almost 1.8 million tons exported from the United
States to Europe in the 3Q/19 was the highest volume on record.