Dec. 1, 2010, Seattle, WA – Wood Resources
International provides an update on the 2010 forest products markets, including global timber,
pulpwood, pulp, lumber, and biomass.
Global timber markets
Global sawlog prices have trended upward in
almost all regions of the world for the past two years. The Global Sawlog Price
Index (GSPI) reached $80.88/m3 in the third quarter, which was the highest
level since the beginning of the financial crisis in late 2008, according to
the Wood Resource Quarterly (WRQ). Western and
eastern Canada are the only two regions that currently have lower log costs in
the local currency than a year ago. The biggest increases have been in the U.S.
Northwest, Germany, Sweden, and northwest Russia.
Global pulpwood price
After a temporary drop in the second
quarter, the Softwood Wood Fiber Price Index (SFPI) increased again in the
third quarter to the highest level during the financial crisis. The SFPI was
US$99.80/oven-dryied tonne (odt) in the third quarter, up US$1.51/odt from the
previous quarter and US$6.68/odt from the same quarter in 2009. Prices went up
not only because the U.S. dollar weakened against most other currencies, but
also because prices in the local currencies were up in Europe, western United
States, and western Canada.
Global hardwood fibre prices also trended
upward, both in local currencies and U.S. dollar terms, in most regions covered
by the WRQ. The biggest increases occurred in Europe, where prices were up
5–10% from the previous quarter. As a result, the Hardwood Wood Fiber Price
Index (HFPI) was up US$1.51/odt to US$104.88/odt.
Global pulp markets
This year has been a very good year for the
world’s producers of market pulp. World production for the first eight months
was 8% higher than last year. During the third quarter, global production was
close to the record high and probably peaked in June or July. Market pulp
producers in western Europe have so far increased production by 18% as compared
to last year. Latin America is still lagging because of the large production
outages early in the year when an earthquake hit the country.
Global lumber markets
Lumber markets were mixed around the world.
In Sweden and Finland, lumber prices trended downward during the first half of
2010. They picked up temporarily in the summer, but are expected to fall again
in the coming months. In the United States, lumber prices saw a dramatic
decline as the result of continued weak demand for lumber in the domestic
market, higher imports from Canada, and limited opportunities for sawmills in
the south to expand exports.
Canadian sawmills have had an eventful
autumn with very volatile price movements. In early October, lumber prices
jumped 8% in one week. Such large price adjustments are unusual in the fall.
West coast spruce-pine-fir prices went up the most and were 14% higher in
September than in June.
Prices for softwood lumber imported to
Japan increased during most of 2010, and in September, reached their highest levels
since early 2009.
Global biomass markets
Woody biomass prices in the United States
peaked in late 2008 and early 2009 and then fell until the second quarter 2010,
when they probably bottomed out for this cycle. Currently, costs for biomass
are the lowest in California and the U.S. Northwest, averaging about US$35/odt
for biomass sourced from the forest industry. Demand for woody biomass in the
U.S. South has slowly increased; as a result, biomass prices have trended
upward the past four years.
Pellet prices in Sweden have gone up every
quarter since late 2008 and are now substantially higher than in central
Europe.
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