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B.C. invests in the growth of global wood markets

Posted on by GWMI Admin

The Government of British Columbia announced last week that it is investing CA$6.2 million to support the forest sector in expanding global markets for B.C. wood products.
Minister of Forests, Lands and Natural Resource Operations Steve Thomson made the announcement on behalf of International Trade Minister Teresa Wat, while attending the Council of Forest Industries annual meeting in Prince George.
The funding is being made available to nine industry trade associations that deliver market development programs on behalf of government and industry. Association activities will focus on expanding markets for B.C.’s solid wood products, with investment priorities reflecting evolving market opportunities in Asia, the U.S.A. and Europe. Activities will be delivered on a cost-shared basis, with additional funding provided by industry and the federal government, through Natural Resources Canada.
B.C.’s contribution is being managed through Forestry Innovation Investment (FII), the Province’s market development agency for forest products. FII also administers the Wood First program, which fosters the innovative use of wood and wood building systems in B.C., and other programs that promote the many environmental benefits of B.C. forest products.
More than 60,000 British Columbians throughout the province work directly in the forest sector and its 7,300 companies. The government is committed to supporting these jobs and businesses by partnering with the forest industry to build on its success in Asia and to explore new niches in the recovering U.S. market.
Quick Facts:

  • B.C. is a world leader in softwood lumber production and exports, with 80% of industry output sold outside the province.
  • In 2014, B.C. exported $5.8 billion in softwood lumber exports.

China stops timber imports from 3 countries

Posted on by GWMI Admin

On 8 April China's National Endangered Species Office issued a directive suspending imports of CITES listed timber species (Pericopsis elata) and (Dalbergia cochinchinensis) from the Democratic Republic of Congo (DRC) and Laos.
The Office reminded timber importers not import CITES listed timber from the two countries until the restriction is lifted.
This restriction follows a directive from CITES Secretariat recommending all signatory countries to suspend trade in CITES-listed species from the DRC, the Lao People's Democratic Republic and Nigeria until further notice due to the failure of these three countries to submit a National Ivory Action Plan.

Average roundwood purchase prices in Latvia in 2014

Posted on by GWMI Admin

During the second half of 2014 the average cost of birch veneer logs in Latvia was up 13 per cent compared to the first six months of the year. On average, Latvian category A veneer logs cost €86.56 per cubic metre during this period, according to figures released by the Latvian Central Statistical Bureau (CSB).
The notable growth in the purchase prices of veneer logs can be explained with the increasing demand for this type of timber in production of birch plywood, sawn timber and furniture. Veneer logs have reached large sales volumes both on the Latvian and foreign markets due to the development of the construction sector and availability of credits, CSB informs.
Compared to the 2nd half of 2013, purchase prices of category A veneer logs have increased on average by 22 euros/m3 without VAT or by 33%. Purchase prices of category B veneer logs in the 2nd half of 2014 compared to the 1st half of 2014 grew on average by 2% or by 1 euro/m3 without VAT.
In the 2nd half of 2014 (vs. H1/2014) the greatest drop in the coniferous roundwood sector was recorded for pine sawlogs with the diameter over 26 cm - on average of 5% or 4 euros/m3 without VAT. Purchase prices of pine sawlogs diameter of 14 - 18 cm did not change and were 69 euros/m3 without VAT. Compared to the previous period purchase prices of spruce sawlogs with the diameter of 18 – 26 cm and 14 - 18 cm decreased by 2% or on average by 1 - 2 euros/m3 without VAT depending on the roundwood diameter.
Compared to the 1st half of 2014 the average purchase prices of birch sawlogs with the diameter of 18 - 24 cm in the 2nd half of 2014 grew on average by 4% or by 2 euros/m3 without VAT.
Purchase prices of black alder sawlogs with the diameter over 24 cm grew by 7% or on average by 3 euros/m3 without VAT. In turn, purchase prices of black alder sawlogs with the diameter of 18 - 24 cm dropped by 6% or on average by 2 euros/ m3 without VAT. Purchase prices of aspen sawlogs have increased slightly - on average by 2%.

Average purchase prices of roundwood in Latvia (euros/m3 without VAT)

Roundwood assortments

2013

2014

H1

H2

H1

H2
Pine diameter up to 14 cm

43.21

45.60

50.16

48.32
diameter 14 -18 cm

64.37

65.55

69.68

69.37
diameter 18 -26 cm

67.39

68.18

73.60

72.31
diameter over 26 cm

73.92

76.11

78.48

74.50
Spruce diameter up to 14 cm

46.77

47.71

52.61

48.09
diameter 14 -18 cm

66.19

67.52

71.21

70.05
diameter 18 -26 cm

74.22

71.30

74.04

72.27
diameter over 26 cm

75.08

76.44

75.08

74.27
Birch diameter 18 -24 cm

49.26

49.53

53.19

55.54
diameter over 24 cm

59.08

59.45

64.63

65.24
Black alder diameter 18 -24 cm

37.02

38.73

37.13

34.88
diameter over 24 cm

43.51

43.54

39.50

42.17
Aspen diameter 18 -24 cm

37.34

38.32

38.30

36.53
diameter over 24 cm

43.44

44.17

43.67

44.55
Birch veneer logs Category A

59.53

65.11

76.76

86.56
Category B

54.47

58.95

62.69

63.87

Data source: Central Statistical Bureau of Latvia

Tropical importers from Europe are optimistic for 2015

Posted on by GWMI Admin

European demand for various tropical timber products and species in the first quarter of 2015 is described as satisfactory to good by several importers. The UK market remains good, even if demand in some instances is reported to be slightly less buoyant than the same time last year.
Some importers report signs of recovery in France and Scandinavia. Some Eastern European markets, especially Poland, are described as relatively active at the moment. The German market is described as stable.
As regards the different products and regions of origin, African timber, especially sapele, wawa, framire, and in some European markets also sipo are in relatively strong demand.
However, importers also report continuing difficulties in sourcing enough timber in Africa. Framire is reported to be very hard to get hold of at the moment and importers suggest they could sell more if there were any extra supply.
Sourcing of other African wood species is made difficult by on-going logistical problems. European importers suggest that truck shortages are causing delays in overland transport in some parts of Africa. In addition to the abovementioned delays in the port of Douala in Cameroon, some importers also mention delays in shipping from Pointe Noire in the Congo.
Competition for supply from Asian and American buyers is mentioned as another challenge by European importers. Some importers said the EUTR and related documentation was still making it hard to compete with their Asian counterparts, as African sawmills would frequently prefer selling to Asia, where less documentation was required and where customers are less picky when it comes to specifications.
American buyers are also finding it relatively easy to outbid their competitors from the Eurozone at the moment due to the strong US dollar and the weakening euro value.
Demand for bangkirai and meranti from Indonesia and Malaysia was also relatively good in February and March of this year, as traders stocked up in anticipation of exchange-rate related price hikes. Importers with large inventories, who were able to offer material at mixed prices, profited from this in particular.
A similar trend was observed for tropical timber from South America. However, the costs of South American tropical wood products had not only increased due to unfavourable exchange rate trends but also due to price hikes instituted by various producers at the end of last year. As a result, importers report that they have been very cautious in placing new orders for shipping this spring.
The strong US dollar represents a factor of uncertainty for sales of tropical wood products traded in this currency in the Eurozone. Whether sales will continue at their current, satisfactory level will largely depend on future currency trends as well as on suppliers‟ willingness to adjust prices. The minor price concessions made by Indonesian and Malaysian suppliers at the beginning of this year were insufficient to offset the loss in value of the euro over the last twelve months and in particular since December 2014.
Moreover, some importers expect those reductions to be temporary in nature and that producers will go back to their old prices in the next few weeks. On the other hand, some sources believe that Brazilian producers may lower their prices in the next few weeks, as the real has also weakened against the US dollar.

Latvia: CLT production plant to start functioning

Posted on by GWMI Admin

The Latvian company Cross Timber Systems has launched a cross-laminated timber (CLT) production facility in Jelgava, Latvia. The company confirmed that it has already received the first orders, the Latvian portal Novaja.lv reported.
To confirm the quality of the products, the company will conduct several tests: test of strength for CE marking, the fortress compounds boards, adhesive properties and the rate of combustion. Testing may take approximately three months.
CLT is made from local pine and spruce and larch imported from Russia. Currently, the company employs 10 employees, in the future, plans to increase staff to 30 people.

Investments for the new production amounted to about 10 million euros. Cross Timber Systems plans to produce up to 25 thousand cubic meters of CLT-panels per year.

 

Huge variations in average plywood export prices in China

Posted on by GWMI Admin

China's plywood exports totalled 11.71 million cubic metres, valued at US$5,810 million in 2014, up 14% in volume and 15% in value from 2013. The average unit price for exported plywood in 2014 was US$496 per cubic metre, a year on year increase of 1.4%. China's plywood was exported mainly to the following markets:

  • USA (1,678,000 cu.m, up 25%)
  • Japan (829,000 cu.m, up 1.7%)
  • UK (716,000 cu.m, up 10%)
  • South Korea (711,000 cu.m, down 8%)
  • UAE (698,000 cu.m, up 64%)
  • Philippines (678,000 cu.m, up 69%)
  • Saudi Arabia (600,000 cu.m, up 41%)

The average export price for plywood was US$764 per cubic metre in the US, US$498 per cubic metre in Japan, US$489 per cubic metre in the UK, US$390 per cubic metre in South Korea, US$367 per cubic metre in UAE, US$429 per cubic metre in Philippine and US$309 per cubic metre in Saudi Arabia.
Around 85% of China's plywood is exported by manufacturers in Shandong, Jiangsu, Guangdong and Guangxi but these manufacturers face tough price competition and complain average prices have only risen by around 10% in 5 years.
Average plywood export price

2013 2014 Change in %
USA 733 764 4.2%
Japan 527 498 -5.5%
UK 458 489 6.8%
South Korea 361 390 8%
UAE 387 367 -5.2%
Philippines 392 429 9.4%
Saudi rabia 353 309 -12.5%

Softwood lumber prices in the U.S. still low in April

Posted on by GWMI Admin

U.S. softwood lumber traders were relieved to put March behind them, but sales in the first couple days of April were nothing to shout about. Dealers across the U.S. and Canada remained cautious. With wet ground stalling work at many job sites, the focus was on clearing inventory rather than forward purchases.
Sputtering movement of loads through the distribution system put traders on edge, and some said the market was oversupplied. Some traders surmised that the holiday-shortened work week, the end of the month and the end of the quarter all contributed to the uneven sales pace.

Week Apr 3
Week Mar 27
Year Ago
2014
Random Lengths Framing Lumber Composite Price*
$337
$336
$370
KD Western S-P-F #2&Btr 2x4 R/L Mill Price
279
282
 344
KD Eastern S-P-F #1&2 2x4 R/L, delivered Great Lakes
381
381
445
Green Douglas Fir Std&Btr 2x4 R/L (Portland)
300
300
 335
Southern Pine (Westside) #2 2x4 R/L
402
399
387
KD Coast Hem-Fir Std&Btr 2x4 R/L
310
310
390
Ponderosa Pine (Inland) #2&Btr 1x12 R/L
670
670
725
* Weighted average of 15 key items

 
Random Lengths Panel Market Report
Structural panel sales were lethargic, and prices slipped. Open-market sales remained
unremarkable in OSB, especially late in the week with many traders out for Easter and Passover observances. Prices were in a flat-to-down mode. Trading in Southern Pine plywood was subdued, and prices of rated sheathing eroded.
Urgency was lacking among buyers at all levels of the market. After a slow start, western Fir plywood sales picked up unevenly as the week progressed.

(f.o.b. mill prices)
Week Apr 3
Week Mar 27
Year Ago
2014
Random Lengths Structural Panel Composite Price*
$371
$374
$355
Southern (west-east) 15/32-inch 3-ply exterior sheathing plywood 435-495 442-500
368-395
Southern (west-east) 15/32-inch 4-ply exterior sheathing plywood
440-500
447-508
368-395
Western 1/2-inch 4-ply exterior sheathing plywood 422 425
372
North Central 7/16-inch Oriented Strand Board 180 180 208
*Weighted average of 11 key items

Russia becomes top sawn softwood supplier to China before Canada

Posted on by GWMI Admin

China's sawnwood imports totalled 25.65 million cubic metres in 2014 and were valued at US$8.0 billion, up 7% in volume and 19% in value on the previous year. The average price for imported sawnwood was US$373 per cubic metre, a year on year increase of 13%.
Of the total, coniferous sawnwood imports rose 4% to 17.64 million cubic metres, at a similar level with 2013. Coniferous sawnwood imports were mainly from the following top 10 countries: Russia (7.21 million cu.m, up 12%), Canada (6.57 million cu.m, down 3.4%), Chile (0.85 million cu.m, down 3.1%), USA (0.84 million cu.m, down 4.2%), Sweden (0.44 million cu.m, up 20%), Finland (0.39 million cu.m,down 2.5%), New Zealand (0.37 million cu.m, down 26%), Germany (0.29 million cu.m, up 38%), Brazil (0.10 million cu.m, up 44%) France (0.09 million cu.m, up 3.4%).
Imports from the top 10 suppliers accounted for 97% of all coniferous sawnwood imports. Coniferous sawnwood imports from Russia and Canada together accounted for 78% of sawn softwood imports.
Coniferous sawnwood imports in 2014 from Russia were higher than from Canada for the first time. The average price for coniferous sawnwood imports was about US$217 per cubic metre in 2014, a year on year increase of 1.4% slightly.
The pace of coniferous sawnwood imports from Sweden, Germany and Brazil was significantly higher than in 2013 while imports from New Zealand were dramatically lower than in 2013.
The main species of coniferous sawnwood imports were spruce, fir (40%) and scots pine (31%).

While tree cover loss remains high globally, it spikes in Russia and Canada

Posted on by GWMI Admin

New, high-resolution satellite-based maps released today by the University of Maryland and Google on Global Forest Watch, a partnership of over 60 organizations convened by the World Resources Institute, reveal a significant recent surge in tree cover loss largely in Russia and Canada during 2013. There is also some good news, with a slowing of tree cover loss in Indonesia, though rates of loss continue a troubling rise across the tropics as a whole. These 2013 data are the first annual update to the influential “High-Resolution Global Maps of 21st-Century Forest Cover Change” published in Science, and are the latest globally consistent estimates of tree cover loss available.
So what do the data say? Much analysis remains to be done, but here are five immediate highlights:
Tree Cover Loss Remains High Globally, Surges in Russia and Canada
Global tree cover loss in 2013 continued to be high at over 18 million hectares (69,500 square miles)—about twice the size of Portugal—slightly lower than 2012, but a troubling 5.2 percent increase over the 2000-2012 average. In 2011-2013, Russia and Canada topped the list (mostly due to forest fires), jointly accounting for 34 percent of total loss.
Tree cover loss is a measure of the total loss of all trees within a
specific area regardless of the cause. It includes human-driven deforestation, forest fires both natural and manmade, clearing trees for agriculture, logging, plantation harvesting, and tree mortality due to disease and other natural causes. Tree cover gain also happened during 2013, but is not included in the 2013 update or this analysis as it is more difficult to monitor than loss. Much of the tree cover loss is only temporary, as forests regenerate after disturbances such as fire, though in the boreal region this is a very slow process.
Boreal Forests Experience the Greatest Increase in Tree Cover Loss of Any Region
The new maps show a recent increase in tree cover loss in parts of the world’s boreal
forests in Russia, Canada and Alaska. Although the tropics had more tree cover loss overall, the boreal region showed the steepest increase of loss of any region. Russia (which at 882 million hectares has the biggest area of tree cover in the world) lost an average of 4.3 million hectares (16,600 square miles) of tree cover per year between 2011 and 2013, an area larger than Switzerland. Fires in the boreal are partly natural (natural fire dynamics play an important role in boreal forests) and partly man-made, with climate change and infrastructure increasingly having an impact. The forest will grow back, but this process takes centuries.
Although the new data do not identify the direct causes of tree cover loss, studies found fires in recent years accounted for around 70 percent of total tree cover loss in Canada and Russia. The area and number of fires in boreal regions vary widely from year to year.
The Natural Resources Canada’s Canadian Forest Service estimated forest fires burned 4.2 million hectares (16,216 square miles) in 2013. Russia’s United Interagency Statistical Information System reported between 3.9 and 6.2 million hectares of burned forest area each year from 2010 to 2014, with a spike of 11 million hectares in 2012. These areas are larger than the tree cover loss estimate from the University of Maryland, possibly due to different mapping methods, different definitions of forest, re-burning of areas where trees have already been killed, and because not all fires kill trees.
Researchers have predicted that climate change could increase the frequency and intensity of boreal wildfires in the 21st century, producing more late-season fires that kill trees and result in greenhouse gas emissions. In some boreal forests, fires are already burning more now than at any time in the last 10,000 years.
Forest fires can also influence the climate. Although the exact relationship between boreal forest fires and the climate is still uncertain (for example, removing trees may also potentially increase albedo and lead to cooler temperatures), larger and more frequent forest fires do generate more greenhouse gas emissions from burning trees and peat soils. Leading scientists at NASA and elsewhere estimatethat the overall effect will be to warm the climate.
It is too early to call this spike a trend. Further research is needed to determine the drivers and estimate impacts of the forest fires, which tend to be highly variable over time and affect some boreal areas more than others. Fires can be tracked daily through Global Forest Watch.
In addition to fires, logging and pests also account for some of the spike in tree cover loss in the boreal region.
Indonesia’s Tree Cover Loss Slows Substantially after Previous Highs
Indonesia’s annual tree cover loss declined in 2013 to the lowest point in almost a decade, pulling the three-year average down to 1.6 million hectares (6,200 square miles) of annual tree cover loss. In addition to a slowing of total tree cover loss, Indonesia’s loss of primary forests slowed to an average of less than half a million hectares per year from 2011-2013, the lowest in the last decade. Primary forests are mature, natural forests that have not been cleared in the past 30 years, and Indonesia’s represent some of the most biodiverse and carbon-rich forests on earth. The drop is surprising, since research published last year by the University of Maryland and WRI showed Indonesia’s loss of primary forests increased rapidly from 2001-2012. A single year, however, does not make a trend. Global Forest Watch will soon publish 2014 data, key to further interpreting the 2013 information.
It is also too soon to say what may have triggered the decrease. A deeper examination into many potential factors is warranted, including the effects of a much-applauded moratorium on new licenses for forest conversion, a significant decline in agricultural commodity prices (especially for palm oil), corporate zero-deforestation commitments and the fact that much of the most accessible forests have been already cleared.

2014 brought price decline for sawlog in many countries

Posted on by GWMI Admin

Sawlog prices were generally lower throughout the world both in the local currencies and in US dollar terms in the 4Q/14 as compared to earlier in the year. The Global Sawlog Price Index (GSPI) fell for the third consecutive quarter to $83.12/m3, which was down 2.6 % from the previous quarter and 6.3% lower than the same quarter in 2013, according to the Wood Resource Quarterly (WRQ). The GSPI is currently at the lowest level in two years.
Over the past year, sawlog prices have fallen the most in Northern and Central Europe in US dollar terms, predominantly as a result of a weakening Euro. Domestic log price also declined in Latin America and Oceania. The only continent where prices did not decline was North America, where healthy US domestic lumber demand and respectable export volumes from both the US and Canada kept consumption of logs as high as in 2013.
The west coast of the US, British Columbia and New Zealand have expanded log and lumber exports to China quite substantially over the past few years, and these are also the regions that currently have the highest sawlog prices as compared to their respective ten-year averages. In the northwestern US, there has been a steady increase in log costs since 2009 and the 4Q/14 prices for Douglas-fir and hemlock sawlogs were 25% higher than their ten-year averages.
On the other end of the spectrum are Russia and Brazil, two regions that currently have substantially lower sawlog prices as compared to the average for the period 2005-2014. For both countries, prices have fallen because of a stronger dollar. In their local currencies, current prices are actually higher than the average price over the past decade.
Countries that had the highest and lowest domestic sawlog costs in the 4Q/14 as compared to the average costs for the past ten years were:

4Q/14 higher then 10 y avg  4Q/14 lower than 10 y avg
US, Northwest (+25%) Sweden (-4%)
New Zealand (+21%) Finland (-6%)
Canada, West (+19%) Canada, East (-8%)
Latvia (+14%) Brazil (-17%)
Estonia (+12%) Russia, NW (-31%)

 
In its latest issue, the WRQ reported that sawmills in Central Europe had some of the highest wood raw-material costs in the world in the 4Q/14, while sawmills in Russia and Latin America enjoyed quite competitive wood costs.

Avedøre power plant in Denmark converts to biomass

Posted on by GWMI Admin

Starting 2016, the last combined heat-and-power (CHP) unit at Avedøre power plant in Denmark is to be converted, and will generate power instead of coal and gas from 2016.
According to copp.com, the conversion will be initiated in April this year and is financed by DONG Energy and VEKS. Completion is expected during the autumn of 2016.
With this conversion, the coal-fired unit 1 will also be able to use wood pellets and in future, wood pellets will be used as primary fuel for heat generation.
When Unit 1 is converted, the heat provided will supply an additional 65,000 households in the Greater Copenhagen area, to around 215,000 households in total.

The decision to convert unit 1 at Avedøre Power Station means that we'll now be in a position to abandon coal and gas entirely when we're generating heat in the Greater Copenhagen area. It's a significant step in the green conversion, taken in a cost-effective way," said Thomas Dalsgaard, executive vice president at DONG Energy, as quoted by copp.com.

VEKS and DONG Energy have just signed a new agreement which means that from 2016 until 2033, unit 1 at Avedøre Power Station will be able to supply green heat to VEKS' customers.
The agreement forms the basis of the investment in converting and prolonging the lifetime of the CHP unit and is a significant contribution to the Danish capital's ambition of being CO2 neutral in 2025.

Sweden: Setra to upgrade two sawmills

Posted on by GWMI Admin

During autumn 2015, Setra will make technology investments at the sawmills in Malå and Färila, both located in Sweden.
At Setra Malå the investment involves upgrading the trimmer and includes a camera for automated sorting and a new control system. Exactly as at Setra’s sawmills in Färila and Nyby, where similar investments were made in 2014, the goal is to improve the efficiency of timber sorting with more consistent quality, lower production costs and improved flexibility to meet customer demands, as the company says in a press release.
At Setra Färila the investment includes a saw line and sawing equipment. This will result in a higher yield due to thinner cuts and more precise measurement of goods produced. The investment will also provide greater market flexibility as well as increased productivity due to more sophisticated control of the machinery.
“Both Malå and Färila are units within Setra that have been conducting successful improvement work for several years. The organisations are now ready to take the next step and with the help of these investments they will be able to shift into a higher gear for enhanced competitiveness,” says Jonas Björnståhl, Head of the Sawn Wood Products business area.
Both investments are scheduled to take place in autumn 2015.
Setra Group has a total of nine sawmills, three processing units and two modular building factories. Setra Malå is a redwood sawmill with integrated processing. The number of employees is approximately 80 and production volume in 2014 totalled 174,000 cubic metres. Setra Färila is a whitewood sawmill with 55 employees and production in 2014 of 151,000 cubic metres of sawn product.

Canadian sawmills continue to expand in the U.S.; Top North American lumber producers in 2014

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Canadian and U.S. softwood lumber producers reported modest gains in 2014 as lumber demand continues to rise slowly (but steadily) in the U.S. as well as in key export markets. Total U.S. softwood lumber shipments increased 4.1% to 31.3 billion bf (73,1 million m3) and Canadian production recorded smaller gains, or +3.1% to 24.2 billion bf (57,1 million m3). Corporate acquisitions were again a big part of the story as the Canadian buying frenzy continued in the U.S. South – since 2004 when only 2 U.S. sawmills were owned by Canadian companies (only West Fraser), there are now more than 35 mills that have been purchased by Canadian firms in the South as well as the U.S. West.
“In fact”, commented Russ Taylor, President of Wood Markets, “the combined sawmill count owned by West Fraser, Canfor and Interfor is now higher in the U.S. than it is in Canada, reflecting the tight availability of timber and limited lumber growth prospects in Western Canada!”
The latest Wood Markets (WM) annual survey of the Top 20 North American softwood lumber producers shows that although the top 20 Canadian companies increased production slightly in 2014 (+0.6%), they recorded a decrease in their market share of total Canadian lumber shipments, slipping to 78% in 2014 from 80% in 2013. The top 5 Canadian producers were Canfor, West Fraser, Tolko, Resolute and Interfor, with their order unchanged from 2013. However, output was lower for the top 3 Canadian companies due to their B.C. interior mills feeling the impact of the mountain pine beetle infestation. In 2014, these top 5 Canadian lumber companies produced a total of 11.6 billion bf (27,3 million m3)-48.0% of Canadian lumber output-, versus 12.1 billion bf (28,5 million m3)-51.4% in 2013.
According to Wood Markets, Canfor retained its lead spot despite its output dropping by 11% (to 3.74 billion bf or 8,8 million m3) due to the sale of its Daaquam mill (Quebec) and the closure of its Quesnel mill. In close second spot was West Fraser at 3.48 billion bf (8,2 million m3) (-3%, due in part to the closure of its Houston mill).
The top 20 U.S. firms produced 60.8% of all American softwood lumber shipments in 2014, versus 58.2% in 2013. This growth indicates that the largest U.S. producers (including Canadian firms) are continuing with their investment strategies aimed at increasing their capabilities and mill efficiencies in preparation for the ongoing U.S. lumber market recovery.
Unlike Canada, the order of the top 5 U.S. companies shifted in 2014. While Weyerhaeuser (+12% to 3.3 billion bf or 7,7 million m3) retained first place, Georgia-Pacific moved into second at 2.27 billion bf or 5,3 mil. m3 (+42%) following the complete addition of Temple-Inland’s five sawmills.
Slipping from second to third was Sierra Pacific (-2% to 1.95 billion bf or 4,6 mil. m3) as the company worked on the rebuild of its Quincy sawmill and commissioned work on a new sawmill in Frederickson, WA. West Fraser kept its fourth spot, with output up 15% to 1.82 billion bf (4,2 mil. m3) and Hampton remained in fifth spot.
According to Wood Markets, the top 5 U.S. firms produced 35.1% (11.0 billion bf or 25 mil. m3; +10.4% over 2013) of U.S. lumber shipments, up from 33.2% in 2013; Canada’s top 5 produced 48.0% (11.6 billion bf or 27,3 mil. m3; -3.6% vs. 2013) of Canadian lumber shipments, down from 51.4% in 2013.

CANADA TOP SOFTWOOD LUMBER PRODUCERS IN 2014 (Million BF)
Rank Company No. of Mills Production %Change
2013 2014
2013 2014
1 1 Canfor 13 4,207 3,735 -11%
2 2 West Fraser 12 3,571 3,476 -3%
3 3 Tolko 8 1,935 1,886 -3%
4 4 Resolute FP 14 1,480 1,585 7%
5 5 Interfor 5 872 943 8%
Total Top 5 55 12,065 11,625 -3,6%
Total Top 20 106 18,801 18,906 0,6%
Total Canada 23,491 24,226 3.1%
Top 5 as a % of Canada Shipments 51,4% 48,0%
Top 20 as a % of Canada Shipments 80,0% 78,0%

Notes: Includes lumber produced only at primary sawmills and excludes U.S. production. (Source: Wood Markets)

USA TOP SOFTWOOD LUMBER PRODUCERS IN 2014 (Million BF)
Rank Company No. of Mills Production %Change
2013 2014
2013 2014
1 1 Weyerhaeuser 15 3,290 3,679 12%
3 2 Georgia-Pacific 16 1,602 2,270 42%
2 3 Sierra Pacific 12 1,984 1,951 -2%
4 4 West Fraser 15 1,582 1,817 15%
5 5 Hampton 6 1,500 1,275 -15%
Total Top 5 64 9,958 10.992 10,4%
Total Top 20 124 17,478 19,024 8,8%
Total US
 30,040 31,277 4.1%
Top 5 as a % of US Shipments 33,2% 35,1%
Top 20 as a % of US Shipments 58,2% 60,8%

Notes: Includes lumber produced only at primary sawmills and excludes all Canadian and offshore production. (Source: Wood Markets)  

Gällö Timber ugrades sawmill

Posted on by GWMI Admin
Gällö Timber invests SEK 10 millions (EUR 1,07 million) in a new control system for the saw line, in a new three dimension log measuring system and in a system for turning and optimizing the yield of every single log.
“This investment gives us the technology for making the best possible use of the wood raw material”, says Urban Wiklund, president of Gällö Timber. “We will be able to get the highest possible value out of every single sawlog.”
Urban Wiklund took on the position of president of Gällö Timber on 1 March, 2015. He succeeded Johan Olofsson, who was appointed manager of SCA’s sawmill in Bollsta.
Gällö Timber is jointly owned by Persson Invest and SCA Timber and has since the start in 2010 invested more than SEK 60 million (EUR 6,5 million) in the sawmill in Gällö and during the same time increased the production by 100 per cent. Gällö Timber has a production capacity of 320 000 cubic metres of sawn timber of pine and spruce.

8% more furniture imported in US

Posted on by GWMI Admin

Following a 7% growth in 2013, US wooden furniture imports increased by 8% in 2014. Wooden furniture imports were worth $14.65 billion in 2014. Imports from all major suppliers increased. The largest growth was in imports from Vietnam and Mexico.
Furniture imports from China grew by 5% in 2014 to $6.99 billion. China's share in total US furniture imports fell by one percentage point to 48%. Imports from Vietnam gained significantly in 2014. They were worth $2.52 billion, up 26% from 2013. As a result, Vietnam's import share grew from 15% in 2013 to 17% in 2014.
Canada's import share remained unchanged in 2014, with imports at $1.20 billion (+5%). Wooden
furniture imports from Mexico were worth $0.66 billion (+27%). Mexico‟s share in total furniture imports increased one percentage point to 5%.
Malaysian furniture shipments were up 4% in 2014 ($0.56 billion). Imports from Indonesia increased by 8% to also $0.56 billion. Both countries‟ imports share was unchanged at 4%.
Wooden furniture imports from other countries were down in 2014, despite higher shipments from Europe last summer

Global hardwood chips prices trending downwards

Posted on by GWMI Admin

Prices for hardwood chip shipped over the Pacific Rim and the Atlantic to markets in Asia and Europe have trended downwards for more than three years. However, in December 2014 and January 15, prices moved slightly upward, according to the FOEX price index PIX-HCG.
Overseas traded softwood chip have experienced declining prices since last summer and were 8.1% lower in January 2015 than in August of 2014.
Globally traded hardwood chips for the manufacturing of pulp and wood-based panels have trended downward for much of the past three and a half years. However, this trend broke in late 2014 and early 2015 when prices slowly started to increase.
The FOEX global hardwood chip price index, PIX-HCG, increased by 1.3% in January as compared to the previous month, and was 1.8% higher than in November last year. The index, which is based on prices for hardwood chips traded overseas to markets in Asia and Europe, reached a four-year low in November 2014 when it was 16.6% below the all-time-high in November of 2011. The PIX-HCG reached US$180.58/odmt (CIF) in January 2015, with the biggest price increases being those of hardwood chips shipped from Latin America and Vietnam to Japan and China.
The softwood chip price index, PIX-SCG, fell sharply during the fall of 2014, from US$185.73/odmt in August 2014 to US$170.67/odmt in January 2015. This 8.1% decline over just five months was partly the result of a stronger US dollar, as well as because of reduced costs for the ocean freight.

Wood flooring consumption weakens in Europe

Posted on by GWMI Admin

While total EU wood flooring imports increased in 2014, the European Wood Flooring Federation (FEP) reports that consumption probably declined last year in many European countries.
According to an FEP estimate published by the international parquet federation Global Flooring Alliance (GFA), European wood flooring consumption fell 3.8% in 2014, after slipping 2.6% the year before. Consumption was 82.7 million sq.m in 2013 and is believed to have been around 80 million sq.m in 2014.
Considering the various European countries, the negative trend identified by FEP in France and Italy in its September market review has apparently continued through the final quarter of the year.
Wood flooring consumption in Germany and Austria was also slightly down from 2013 levels, after Germany had shown a positive trend in the early months of 2014. Swiss consumption was static last year, whereas Sweden and Hungary showed slight increases.
When it comes to wood species, the FEP sees a continuing dominance of oak in the overall sales mix, while the share of exotic woods has declined further. Wider boards and “natural look” flooring remains very popular, according to the FEP.

Softwood lumber prices fell in some key global markets

Posted on by GWMI Admin

Global trade of softwood lumber has continued to trend upward ever since the global financial crises in 2008. In 2014, export volumes were up 5-8 percent for a majority of the largest lumber-exporting countries in the world, including Canada, Russia, Finland, Sweden and Germany, according to the Wood Resource Quarterly (WRQ).
Of the top fifteen exporting countries, only Austria, the US, New Zealand and the Czech Republic reduced their export volumes in 2014 as compared to the previous year.
Lumber market update – North America
Lumber consumption in the US increased 6.9% in 2014 as compared the previous year, according to WWPA. This increase came because of a rise in consumer confidence and an improved housing market. Higher demand for lumber resulted in increases in lumber production in the Western and Southern states, while sawmills in British Columbia reduced production in 2014.
In the US, lumber prices have gone through some ups-and-downs the past two years with southern yellow pine prices having fluctuated between $198/m3 (actual size) and $284/m3 over the period. Prices averaged around $250/m3 in February, 2015.
Lumber market update – Northern Europe
Lumber prices declined during much of the fall of 2014 in both Sweden and Finland because of the weakening of the export market during the second half of the year. Despite the reduced demand from the foreign markets, the sawmill sectors in the Nordic countries did not cut back production as much as needed to keep the prices at the high levels reached in the first half of the year. As a consequence of a surplus of lumber in the market, prices fell about 13% during the fall.
Lumber market update - Japan
The higher sales tax that was implemented in the spring of 2014 in Japan had a major impact on consumer spending, including the investments in new housing. The wooden housing starts were down 11 percent in 2014 from 2013. Lower demand for lumber impacted both lumber production in Japan and the importation of wood products in 2014. With the reduced demand and weaker Yen, lumber prices in US dollar terms fell quite substantially during 2014.
Lumber market update – China
The demand for lumber in China weakened during the second half of 2014 with import volumes of softwood lumber in the last quarter of the year falling nine percent from the 3Q/14 and six percent from the same quarter in 2013. The average import price for softwood lumber stayed fairly flat for most of the summer and fall of 2014.

Norbord and Ainsworth OSB mega-merger to be completed this month

Posted on by GWMI Admin

Norbord Inc. and Ainsworth Lumber Co. Ltd. announced that they have been informed by the Antitrust Division of the United States Department of Justice that it has closed its review of the previously announced combination of Norbord and Ainsworth. Norbord and Ainsworth expect the transaction to be completed on March 31, 2015. 

On December 8, 2014, Norbord and Ainsworth announced that they had entered into an arrangement agreement under which Norbord and Ainsworth would merge to create a leading global wood products company focused on oriented strand board (OSB) across North America , Europe and Asia.  Under the terms of the transaction, Norbord will acquire all of the outstanding common shares of Ainsworth in an all-share transaction.

On January 27, 2015 , the transaction was approved by the shareholders of each of Norbord and Ainsworth. On January 30, 2015, the Supreme Court of British Columbia granted a final order approving the combination of Norbord and Ainsworth by way of a plan of arrangement under the Business Corporations Act (British Columbia).
On a pro forma basis, the combined company generated USD $1.63 billion in sales and USD $143 million in Adjusted EBITDAfor the 12 months ended September 27, 2014.
Norbord operates seven North American mills, principally in the U.S. southeast with one mill in Quebec, along with four mills in Europe principally serving the United Kingdom, Germany and the Benelux region. Ainsworth operates four Canadian mills, three in Western Canada and one in Ontario. With total OSB capacity of approximately 7.7 billion square feet (3/8 inch basis), the combined company will be the largest in the global OSB industry.
The newly formed company plans to increase capacity through the expansion of Norbord's OSB production in Western Europe, the restart of Norbord's two idled mills in North America and the completion of Ainsworth's second line in Grand Prairie, Alberta.

China establishes strategic forest reserves

Posted on by GWMI Admin

The Chinese State Forestry Administration (SFA) has reported that it will begin work on establishing strategic forest reserves this year. The aim is to establish an additional 14 million hectares of national forests by 2020.
The concept of strategic forest reserves was piloted in 15 provinces but will now be expanded nationally. The central government will provide a RMB300 per mu subsidy for „common forests‟ and RMB500 per mu subsidy for „rare forests‟. (10 mu = approx. 0.7 ha.)
„Common‟ forests include fast growing tree species such as poplar and eucalyptus for example while „rare‟ forests include high value redwood species for example.
There is a strong demand in China for large diameter logs and at present these are sourced from the domestic natural forests or imports but with the logging restrictions in China's natural forests and with overseas suppliers scaling back harvests in natural forests, especially in the tropics, there will be a huge gap in between Chinese demand for timber and supply.
The SFA notes that 86 countries have introduced policies to restrict or prohibit export of high value and rare timbers which are in demand in China and it is this that has prompted the SFA to consider the establishment of strategic forests.

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