Interview with the Japan Cross Laminated Timber Association

Transcription

1 Semi-Monthly ISSN Volume 56 Number 7 Interview with the Japan Cross Laminated Timber Association CLT, which could be said a mass of timber and is expected to become the pillar for expanding demand of domestic lumber, has many advantages such as light in weight, strong, fire-resistance, high heat insulation and seismic resistance, and quick assembly on site. Supported strongly by political aspect, which aims at reduction of CO 2 emissions and sustainable forest utilization, CLT is well on the way to utilization with unprecedented speed for lumber products. But within the industry, there are voices of bewilderments because they did not catch up with the unprecedented speed of developments. JLJ visited the Japan Cross Laminated Timber Association and interviewed Managing Director Makoto Kawai, and Manager Yoh Nakashima, for the current condition and prospect of CLT to summarize information. 1. First, could you tell us about the Japan CLT Association? This Association originally founded in January 2012, and then decided to become a general incorporated association on April 2014, so we started to gain members from February in advance. A company dorm of Ootoyo Seizai Co., Ltd. in Kochi Prefecture Hot Topic: In the 2nd quarter, the demand for domestic logs for lumber was forecast to increase from the previous year while the demand for domestic logs for plywood and imported wood was forecast to decline. >> Page 2 Copyright, JLJ Inc. We began to advertise for members with the Makoto Kawai ( right ), Managing Director and Yoh Nakashima ( left ), Manager target of 100 members. Now, the number of members is 189 companies (as of 8th December 2014), and we have received applications on a daily basis. The members are various organizations, such as lumber product manufacturers, distributors, general contractors, designers, glue manufacturers and machine manufacturers as well as universities and government administrations. 2. Why does CLT draw this much attention? CLT suits the politicians thought; Why isn t timber more utilized in Japan which has abundant forest resources? Can wood be used for regional revitalization? (creation of new jobs) The fact that the production of CLT is increasing in other forest countries also made an impact on politicians. As CLT is used as board, it consumes large amount of cedar compared with other methods. This is also draws attention. 3. How is the production situation of CLT? The Japanese Agricultural Standards (JAS) for CLT were established in December 2013, and there are two factories currently producing CLT as the JAS authorized factories: (Continued on Page 2)

2 Page 2 MEIKEN LAMWOOD CORPORA- TION in Okayama Prefecture and Yamasamokuzai Co. Ltd. in Kagoshima Prefecture. The production capacity of each factory is 4,000 cubic meters per year. In addition, the Length Cooperative Association is preparing to get JAS certification for 36mm J panel as CLT which already have been produced and been on the market. These three organizations have manufactured products from cedar, and acquired various data from cedar as well. On the other hand, in Hokkaido, CLT made from larch has been tested by government initiative. Our association hopes that factories are built in East Japan and North Japan. 4. Is the preparation for legal restrictions on the use of CLT in construction progressing? Currently, in the case of building with CLT construction method, the approval of the Minister of Land, Infrastructure, Transport and Tourism is necessary. However, in the roadmap to popularize CLT released by the Forestry Agency and the Ministry of Land, Infrastructure, Transport and Tourism, it aims to enable construction of building by relatively easy calculation without the Minister s approval by the end of 2016 fiscal year. It also aims to develop general ways for using CLT, to secure fire-resistant performance (burning margin design) by the time same year, and to enable use of CLT showing on the surface uncovered for a 3- story building or less. In addition, by developing the joining methods and technology, it aims to realize the partial use of CLT for floors, walls, and seismic strengthening. 5. What do you think about processing of CLT and distribution? CLT is the material that is easy to process at factories. Panels are processed to final stage in a factory, and then assemble it at a construction site. The steps of processing are as follows: First, cut the openings from large boards, next, drill holes for wiring and other equipment. As there is no difficult work, not only precut factories but also the factories producing CLT can do it. The advantages of CLT construction method are to be able to assemble quickly and easily. Compared with reinforced concrete construction, CLT needs fewer workers on-site. This is the point that draws general contractors attentions who are the members of our association. The method is said to be similar to the one using precast concrete boards. In construction industry, which is facing manpower shortage, CLT construction method has large potential with the advantages of fewer labors and shorter construction periods. :Forecast: Forecast of the supply and demand for major timber The Forestry Agency recently held a conference concerning the supply and demand of timber in Japan and compiled the short-term forecast for the supply and demand of major timber for the second quarter (April - June) of and the third quarter (July - September) of. New housing starts for fiscal (April - March 2016) that were used as the base for forecast were estimated to be 891,000 units, up by 1.3% from the previous year. As for the timber demand for the second quarter (April-June), the demand for domestic logs for lumber was forecast to increase from the same period in the previous year while the demand for domestic logs for plywood as well as the demand for imported logs, imported lumber products and imported plywood was forecast to decline from the same period in the previous year. As for the timber demand for the third quarter (July-September), the demand for domestic logs for lumber, imported logs and imported plywood was forecast to increase from the same period in the previous year while the demand for domestic logs for plywood and the imported lumber products was forecast to decline slightly. Due to the impact of the labor negotiations with port workers on the West Coast in the U.S, the supply of products of North American lumber which is the major foreign lumber was forecast to decline from the same month in the previous year until the second quarter. However, in the third quarter, the impact was forecast to be mostly gone, and the arrival was forecast to increase by around 10% from the same period in the previous year partly because the domestic inventory was low. As for the supply of European products, the arrival in the second quarter and third quarter was forecast (Continued on Page 4)

3 Page 3 Quarterly Supply & Demand for Major Timber (1,000 cubic meters) Total Total Total 1Q 2Q 3Q 4Q Total *1Q *2Q *3Q Domestic Logs demand for lumber 11,492 11,321 12,058 3,178 3,162 2,889 3,196 12,425 3,200 3,300 3,300 demand for plywood 2,524 2,602 3, , American Logs supply 3,078 3,048 3, , demand 3,129 3,059 3, , stock American Lumber supply 2,786 2,751 2, , demand 2,751 2,765 2, , stock European Lumber supply 2,485 2,443 3, , Southsea Logs supply demand (for lumber) (for plywood) stock Southsea Lumber supply demand stock Russian Logs supply demand stock Russian Lumber supply NZ-Chilean Logs supply demand stock NZ-Chilean Lumber supply demand stock Plywood supply 6,305 6,090 6,462 1,647 1,676 1,477 1,497 6,297 1,480 1,480 1,510 (domestic output) 2,639 2,564 2, , (imported) 3,666 3,526 3, , demand 6,160 6,074 6,517 1,680 1,552 1,465 1,513 6,211 1,450 1,480 1,500 (domestic output) 2,641 2,571 2, , (imported) 3,519 3,503 3, , stock ,121 1,245 1,257 1,240-1,270 1,270 1,280 (domestic output) (imported) Structural Laminated Lumber supply 1,977 2,048 2, , (domestic output) 1,306 1,374 1, , (imported) *The figures for 1Q are presumption; for 2Q and 3Q are estimates. *Source: Forestry Agency

4 Page 4 to continue to decline by 15-30% from the same period in the previous year due to a sluggish domestic demand. On the other hand, the supply of Russian lumber products was forecast to be firm as the local currency situation became relatively stable. As for logs, the supply of North American logs which are major logs in the second quarter and third quarter was forecast to decline from the same period in the previous year in response to the conditions of the U.S. housing market, weather in producing areas and the trend of demand in Japan. The import of logs from New Zealand which are used for packing was forecast to match the domestic demand. :Housing data: Housing Starts in February According to a report released by the Ministry of Land, Infrastructure, Transport and Tourism on March 31, Japan s housing starts in February (Continued on Page 5) Housing Starts by Region (unit of home / %) Tokyo metropolitan Chubu region Kinki region Other regions unit y/y unit y/y unit y/y unit y/y JAN 26, , , , FEB 27, , , , MAR TOTAL wooden Structure Housing Starts were 67,552 units (down 3.1% from the same month in the previous year), nonwooden owneroccupied (unit of home) Owner / Occupant built-forsale rent COH 2014 TOTAL 892, , , , ,191 7, ,428 YTD 135,265 72,195 63,070 41,095 52,528 1,155 40,487 Jan. 67,713 36,196 31,517 20,282 26, ,042 Feb. 67,552 35,999 31,553 20,813 25, ,445 Mar. Apr. May June July Aug. Sep. Oct. Nov. Dec. *source: Ministry of Land, Infrastructure, Transport and Tourism *COH=company owned houses to be rented to their employees, etc. Housing Starts of Built for Sale, Prefabricated and 2 x 4 homes (unit of home / %) Built for Sale Condominiums Single family homes Prefabricated homes 2 x 4 homes unit y/y unit y/y unit y/y unit y/y unit y/y Annual Starts , , , , , , , , , , , , , , , , , , , , Monthly Starts JAN. 20, , , , , FEB 20, , , , , MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

5 Page 5 falling below the previous year s results for twelve consecutive months. However, the decline is smaller compared to double digit decrease which continued for a while due to a reaction to the rush demand ahead of consumption tax hike. The seasonally-adjusted annual rate was 905,000 units (up 4.7% from the previous month), recovering to 900,000 units for the first time in ten months. Analyzing the results of February by owner/occupant, housing starts of owner-occupied houses dropped 9.1% from a year earlier to 20,813 units, decreasing for thirteen months in a row. Rental houses were down 7.5% to 25,672 units, falling for eight straight months. On the other hand, built-for-sale houses were up 11.2% to 20,445 units, increasing for the first time in four months. This is because condominiums increased 23.3% to 10,693 units, increasing for the first time in three months. For single-family houses, housing starts were down 0.2 % to 9,630 units, decreasing for ten successive months. The increase in condominiums was mainly contributed by the increase in building construction in Tokyo metropolitan area. By construction method, housing starts of prefabricated houses were 10,672 units (down 1.5%), decreasing for four consecutive months, while two-by-four houses were 8,132 units (up 2.4%), surpassing the previous year s results for the first time in twelve months. Wooden houses were 35,999 units (down 2.1%), and non-wooden houses were 31,553 units (down 4.2%). The ratio of wooden hoses by the number of units was 53.3 %. :Wholesalers view: Southsea timber market in March The monthly meeting of the Tokyo chapter of the Japan Southsea Lumber Conference was held on April 6, and domestic log prices at the end of March increased significantly for 3 consecutive months. Domestic log prices are maintaining a bullish tone due to the weak yen and the increase in prices caused by the decline in logging volume in producing areas. As for conditions in producing areas, in Sarawak, Malaysia, the government is strengthening its efforts to crack down on the illegal logging. An import company said, Due to the crackdown, the logging volume of wood might have declined by 40-50%. The government is FOB of Southsea Logs expected to maintain a stern attitude toward the illegal logging. The log purchase by India is steady, and plywood factories in Malaysia are also purchasing high-priced logs as their inventory of logs is low. As a result, log prices in producing areas remain high, and the price of logs for Japan is also stuck at a high level. As for logs for Japan, the number of shippers handling logs for Japan in local areas is on the decline due to the time and efforts required for selecting trees. In Papua New Guinea and Solomon, while the log purchase by China is low, Indian buyers who cannot purchase logs in Myanmar started purchasing logs there. The freight cost is declining in general due to the decline in oil prices. However, the (Continued on Page 7) Wholesale Price of Southsea Logs (1,000 yen / 'koku' ) 2014 Nov Dec Jan Feb Mar Logs for plywood (lauan) Sarawak Solomon PNG Logs for lumber Sabah Apitong/Keruing Melapi Exchange rate / USD *Due to transaction volum of logs for lumber is derceasing, the prices are largely affected by the quality of logs sold in the month. (US$ per cubic meter) 2014 Highest Lowest Feb Mar April 1st Week 1st Week 1st Week Sarawak Logs Meranti SQ-up Meranti Small (Small 70%, S.S. 30%) Ocean Freight Sarawak Yen/US$ *SQ = second quality, S.S. = super small

6 Page 6 Imports of Southsea Logs by Origin (1,000 cubic meter) Southsea Logs Import Total Sabah SRWK Slmn. PNG YTD Jan Feb Mar. Apr. May June July Aug. Sep. Oct. Nov. Dec. Supply/Demand of Southsea Logs (1,000 cubic meter) Southsea Logs Import Demand Stock Total Total for PW for Lbr YTD Jan Feb Mar. Apr. May June July Aug. Sep. Oct. Nov. Dec. Import Results of Southsea Lumber Products (unit: cubic meter; %) Overall Lumber Products Lumber Processed lumber Free boards YTD y/y YTD y/y YTD y/y YTD y/y Feb China 18,433 39, , ,022 13, ,835 25, Malaysia 8,631 17, ,451 11, ,822 5, Indonesia 10,127 24, , ,211 6, ,078 16, Vietnam 3,564 7, , ,450 5, Philippines 1,199 2, , Canadian SPF Dimension Lumber The import prices of Canadian SPF dimension lumber in early April were $510/mfbm for 2x4, 2x6 and 2x8 items and $600/mfbm for 2x10 with both prices down by 10 dollars from the end of last month. Local prices of dimension lumber for Japan have been declining by 10 dollars every month from 540 dollars and 630 dollars, prices recorded at the beginning of the year (January). The weakness in local prices is mainly caused by the decline in the number of offers from Japanese buyers. Local factories are reducing the production volume in order to cope with the decline in orders received, said an importer. Japanese importers who cannot make offers are also struggling. However, according to the statistics in February, new housing starts for the 2x4 housing, which kept declining from the previous year level for one year, finally increased to 8,132 units. The increase in housing starts for the 2x4 housing ahead of housing built by other methods was the bright news for people in the industry. At the meeting for those involved in the 2x4 business which was held in Osaka in March, one of participants said, New housing starts in 2014 declined by 9% from the previous year, but the housing starts for the 2x4 housing declined as little as 7.2% to 111,500 units. This year, we would like to aim at 150,000 units by taking advantage of a strong trust toward the housing performance. In recent years, there is an expectation toward the increase in demand for the 2x4 housing especially in the category of residential houses with rentals.

7 Page 7 freight cost for Japan is unchanged as the number of shipping companies is limited. As for the import of locally-sawn Southsea lumber products, the log shortage in local areas and the shutdown of the factory operation continue, and people are worried about the stable supply of products to Japan. In Japan, the price of stiffener rose to as high as 80,000 yen per cubic meter due to the inventory shortage, and customers have become unable to afford all products including first-class and secondclass lumber. Moreover, the quality of products is deteriorating with the deterioration in the quality of logs, and wholesalers are concerned that they may lose customers. As for the deck materials, the movement of products is expected to recover in future because the number of requests for estimates for large-scale constructions started increasing at the end of March. The movement of Merkus pine laminated lumber is not poor, but the profit for wholesalers is down as the domestic market prices fail to increase. The arrival cost of red-pine laminated lumber is higher than Merkus pine laminated lumber, and it is difficult to set domestic selling prices of red-pine laminated lumber. :Statistics: Plywood supply in February Compiled by the Japan Plywood Manufacturers Association from the Trade Statistics of the Ministry of Finance, the amount of imported plywood in February was 263,000 m³ (1.4% increase compared to the same month last year) exceeding the results of the same month in the previous year for the first time in 8 months. The amount of plywood received from Malaysia, the country with the largest imports, decreased for the 3rd consecutive month to 118,000 m³ (5.1% decrease), and the amount from Indonesia decreased for the 5 th consecutive month to 72, 000 m³ (4.3% decrease), but because the amount received from China largely increased to 59,000 m³ (27.5% Amount of Imported Plywood by Countries m 3 ; % Overall Amount of Imported Plywood Malaysia Indonesia China New Zealand Taiwan y/y y/y y/y y/y y/y y/y JAN 298, , , , , , FEB 263, , , , , MAR YTD 561, , , , , , Supply and Demand of Softwood Plywood Domestic Production increase), the total amount of imports increased. The value of imported plywood (CIF) was billion yen (13.7% increase); due to the rise in prices in the producing regions and the falling yen, the value greatly increased. According to Plywood Statistics compiled by the Ministry of Agriculture, Forestry and Fisheries, the amount of production (domestic supply) of regular plywood in February was 228,000 m³ (0.8% decrease compared to the same month last year) decreasing for the 8 th consecutive month. Because the amount of shipments greatly declined to 193,000 m³ (18.3% decrease), the amount of stocks at the end of February increased for the first time in 3 months to 285,000 m³ (13.8% increase). Within the amount of (Continued on Page 10) Shipment m 3 ; % Inventory 3mm & below 3-6mm 6-12mm 12mm & over y/y y/y y/y y/y y/y y/y y/y JAN 211, , , , , , FEB 213, , , , , , MAR YTD 424, , , , , Supply and Demand of Regular Plywood m 3 ; % Domestic Production Shipment Inventory Imports Total Supply 3mm & below 3-6mm 6-12mm 12mm & over in Japan y/y y/y y/y y/y y/y y/y y/y y/y y/y JAN 226, , , , , , , , , FEB 228, , , , , , , , , MAR YTD 454, , , , , , , ,015,

8 Page 8 North American 2014 April March April Logs Hemlock Coast No.3, 12" up 23,400 23,400 23,400 p.c.m Douglas Fir SS No.3, 12" up 27,720 28,800 28,800 " Douglas Fir Coast No.3, 12" up 25,920 26,640 26,640 " Douglas Fir mid-dia., 8/11, J-sort 24,120 24,840 24,840 " Lumber Hemlock 105mm sq., roof beam, std. 50,000 52,000 52,000 p.c.m Hemlock 105mm sq., roof beam, KD 58,000 60,000 60,000 " Hemlock 90mm sq., purlin, std. 50,000 52,000 52,000 " Hemlock 90mm sq., purlin, KD 58,000 60,000 60,000 " Hemlock 45x105mm, KD, floor joist, 4m 48,000 49,000 49,000 " Hemlock 105mm sq., preserved sill, 4m 49,000 51,000 51,000 " Douglas Fir 90mm sq., purlin, KD 60,000 62,000 60,000 " Douglas Fir 45x45mm, KD, rafter, 4m 59,000 57,000 56,000 " Douglas Fir 45x105mm, solid, KD, floor joist, 4m 56,000 56,000 55,000 " Douglas Fir 120mm sq., laminated, 6m 125, , ,000 " Douglas Fir hirakaku, KD, 3, 4m 59,000 57,000 55,000 " Douglas Fir hirakaku, laminated, 3, 4m 125, , ,000 " Yellow Cedar 5" x 6W BC Clear 150, , ,000 " Yellow Cedar 120mm, sill (pithless), 4m 75,000 71,000 70,000 " Spruce 8"3/4, board, Clear 240, , ,000 " European Whitewood 105mm sq., 5-ply kudabashira, home-sawn 2,000 1,900 1,880 per piece Whitewood 105mm sq., 5-ply kudabashira, imported 2,000 1,850 1,850 " Whitewood 27x105mm, solid, 3m, Central 51,000 48,000 48,000 p.c.m Whitewood 27x105mm, solid, 3m, Nordic 51,000 48,000 48,000 " Whitewood 30x105mm, solid, 3m, Central 51,000 48,000 48,000 " Whitewood 30x105mm, solid, 3m, Nordic 51,000 48,000 48,000 " Whitewood rough lamina, randam length, Central 44,000 39,000 39,000 " Whitewood rough lamina, randam length, Nordic 45,000 40,000 40,000 " Redwood hirakaku, laminated, 3~6m 65,000 60,000 59,000 " Dimension Lumber (Yen; wholesale prices, on truck; green count) SPF 2x4~8", KD 10~20' J-grade 43,500 42,500 41,500 p.c.m SPF 2x10", KD 10~20' J-grade 48,500 47,500 46,500 " Whitewood 2x4~8", KD 10~16' J-grade 45,000 44,500 44,000 " Whitewood 2x10", KD 10~16' J-grade 50,000 49,500 49,000 " Japanese Logs Japanese Market Indications p.c.m=per cubic meter Japanese Cedar (Akita) m, 14-22cm dia. 11,600 11,500 11,400 p.c.m Japanese Cedar (Fukushima) m, 14-22cm dia. 11,100 10,400 10,400 " Japanese Cypress (Gifu) m, 14-22cm dia. 22,700 16,900 - "

9 Page 9 Japanese Market Indications 2014 April March April Japanese Lumber Japanese Cedar post 10.5cm sq., 3m 57,900 58,500 58,400 p.c.m Japanese Cedar post 10.5cm sq., 3m KD 70,600 66,800 66,300 " Japanese Cedar roof beam 10.5cm sq., m 54,200 53,000 53,000 " Japanese Cypress post 10.5cm sq., 3m 84,400 80,300 79,400 " Japanese Cypress post 10.5cm sq., 3m, KD 100,700 90,400 87,500 " Japanese Cedar kowari lumber (Akita) per piece Japanese Cedar 2.7 x 10.5cm, KD (Kyushu) 62,000 56,000 54,000 p.c.m Russian Logs *Whitewood mid-dia., short-length in Toyama market 7,500 6,100 6,100 per koku *Larch mid-dia., short-length in Toyama market 7,500 5,800 5,700 " *Red Pine mid-dia., short-length in Toyama market 7,800 6,800 6,800 " Lumber Whitewood rafter in Chukyo market, Green 56,000 50,000 50,000 p.c.m Whitewood rafter in Chukyo market, KD 70,000 63,000 63,000 " Whitewood rail in Chukyo market 57,000 51,000 51,000 " Radiata Pine Logs New Zealand, A-sort 5,100 5,000 5,000 per koku Lumber board, Chile 12.0mm x 4m, random width (120,150, 180, 210mm) 37,000 40,000 41,000 p.c.m Southsea Logs for plywood Meranti (Hill SRWK) ordinary lot 10,530 12,470 12,700 per koku Meranti (Hill SRWK) small lot 9,530 11,200 11,500 " Kapur (SRWK) 13,000 14,700 15,000 " Plywood Type II 2.3mm x 910 x 1820, F4-star per sheet Type II 4.0mm x 910 x 1820, F4-star " Type II 5.5mm x 910 x 1820, F4-star " Concrete form (CF) Type I 12.0mm x 900 x ,360 1,340 1,320 " Imported CF JAS 12.0mm x 900 x ,370 1,400 1,400 " Imported structural PW JAS 12.0mm x 910 x 1820, F4-star 1,450 1,420 1,420 " Structural Softwood PW 12.0mm x 910 x 1820, F4-star 1, " Structural Softwood PW 24.0mm x 910 x 1820, F4-star 2,550 2,430 2,200 " OSB JAS 9.5mm x 910 x per sheet JAS 12.0mm x 910 x " *The prices have been revised since July 2014 due to a change of the company offering prices and the quality of logs.

10 Page 10 regular plywood, the amount of production of softwood plywood was 214,000 m³ (0.7% decrease), the amount of shipments was 179,000 m³ (19.2% decrease), and the amount of stocks at the end of the month was 244,000 m³ (168.0% increase). Because of the increase in stocks of domestic softwood plywood, maintaining product prices has become difficult. Plywood market 1 st Week April The movement of domestic softwood plywood started becoming slightly active in the middle of March as it was a month for the account settlement and also as the largest manufacturer announced that it would raise products prices in April. However, as the active movement of products did not stem from actual demand, the market situation became sluggish again in April. While the actual demand is poor, users and distributors are trying to see manufacturers stance on the price increase, and it is not clear if the price increase announced will be accepted. Plywood manufacturers are reducing the production volume, but the inventory is increasing as the shipment fails to increase. The inventory at the end of February was 244,000 cubic meters, increasing to 2.5 times the volume in the same month in the previous year. As for the imported plywood, though March was a month for the account settlement, there were no products sold at extremely low prices, which had been a concern. The imported plywood products, whose purchasing prices are higher than market prices, started being distributed and while importers want to have the price increase accepted at any cost, prices barely manage to stay at the current level as the actual demand is low. Port inventory remains high. There is an extreme gap between the price of imported plywood and domestic softwood plywood especially for 12 mm items for the structural use, which has never been seen before. As the gap is so large, there is a concern among those involved in the business that the shift in demand may take place. News in Brief The Forestry and Forest Products Research Institute, an incorporated administrative agency, recently announced the discovery that in tropical rain forests the capacity of leaves to conduct photosynthesis increases as the height of the tree becomes taller. Tropical rain forests, which accumulate a large amount of CO2, contribute to the alleviating climate change. The research institute sees the need to clarify the process one by one beginning with the photosynthesis capacity of leaves in order to precisely evaluate this capacity and to predict the response of tropical rain forests when temperature and amount of rainfall change in the future, so the institute is conducting various kinds of research. For this current research, the photosynthesis capacity of leaves was measured from more than 100 kinds of trees with a height from small trees of 1 meter to large trees of over 50 meters in the rain forests of Malaysia. From these measurements, the institute found that as the height of the tree rises, the photosynthesis rate also increases and that even large trees can fix a large amount of carbon. Research in temperate regions found that photosynthesis capacity decreases after going over a certain height because of the difficulty of tall trees to draw up water to leaves in temperate zones. As a cause for the photosynthesis capacity not decreasing even in tall trees in rain forests, the institute believes that the year-round damp climate of rain forests seems to be related. The Real Estate Economic Institute Co., Ltd. (Tokyo) recently announced the nationwide condominium market trends for The number of condominiums sold in the major cities nationwide in 2014 was 83,205 units (21% decrease compared to the previous year) decreasing for the first time in 5 years. Based on region, the number of condominiums sold was 44,913 units (20.5% decrease) in the Tokyo Metropolitan area, 18,814 units (23.8% decrease) in the Kinki region, and 4,363 units (26.8% decrease) in the Tokai-Chukyo region decreasing more than 20% in all 3 major metropolitan areas. In other regions, the decrease was conspicuous with a 3.3% decrease in Tohoku, a 4.2% decrease in Kanto, an 11% decrease in Kyushu, and a 35.6% decrease in Chugoku. Only the Hokuriku-Sanin region had an increase (58.1% increase). The amount of supply based on company showed Sumitomo Realty and Development Co., Ltd, (6,308 units) at the top followed by Mitsubishi Jisho Residence Co., Ltd. (5,300 units) and Nomura Real Estate Development (Continued on Page 11)

11 Page 11 Co., Ltd. (4,818 units). On the other hand, the amount of sales this year is expected to increase for the first time in 2 years to 90,000 units. Many regions are expected to have an increase, and the Tokyo Metropolitan area is expected to increase 0.2% to 45,000 units with a 50% share, and no change is expected in the conditions of the market that is heavily concentrated with major companies. Recently compiled by the Gypsum Board Association of Japan (10 member companies), the supply and demand of gypsum board for 2014 (January to December) showed the amount of production at 528,842,000 m² (2.6% increase compared to the previous year) and the amount of shipments at 526,963,000 m² (2% increase) exceeding the results of the previous year for the 5 th consecutive year for the amount of production and the 4 th consecutive year for the amount of shipments. In 2014, overall housing construction starts underwent a contraction, but the supply and demand of gypsum boards exceeded the results of the previous year because of the shift in construction starts of rental homes to a comparatively bullish tone due to inheritance tax measures and because of the rising trend of installing high quality heat and sound insulation. However, when construction starts of rental homes began to decline from July, the months in which the amount of supply and demand fell below the results of the previous year became conspicuous, and although the amount of shipments in the first half of the year from January to June rose 8.6% compared to the same period in the previous year, it fell 3.7% in the second half from July to December showing a clear contrast. Based on the thickness of the boards, the amount of production of 9.5 mm had a 32.3% share (0.5 point increase compared to the previous year) while 12.5 mm had a 61.3% share (1 point decrease) and over 15 mm had a 6.4% share (0.5 point increase). The share of the main item of 12.5 mm decreased for the first time in 7 years, but over 15 mm increased for the 4 th consecutive year showing that the needs of items with a certain amount of thickness is continuing to be on a rising trend. As of February 26, Sumitomo Corporation (Tokyo) has sold its shares of Seven Industries Co., Ltd., a consolidated subsidiary, to Tsuzuki Corporation (Ina City, Nagano Prefecture) and Nishigaki Lumber, Inc. (Sakurai city, Nara Prefecture). With this sale, Seven Industries moved away from its consolidated ties with Sumitomo and shifts from a subsidiary company to an affiliated company. Tsuzuki Corporation and Nishigaki Lumber became major shareholders of Seven Industries. Among the shares that were sold, Tsuzuki Corporation acquired about 2.36 million shares (16%), and Nishigaki Lumber acquired about 2.07 million shares (14%). The largest shareholder remains Sumitomo Corporation (20.6%). The sale was conducted with the purpose of allowing Sumitomo Corporation to bring Tsuzuki Corporation, which has achieved results in the precut lumber business, and Nishigaki Lumber, which is developing domestic wood material business, into the operations of Seven Industries. In the future, Sumitomo Corporation will work as a business resource for both companies and is seen as promoting the growth of Seven Industries. NIKKEI MESSE: Shop, Office, House & Urban Innovation Exhibition Japan (sponsored by Nikkei Inc.), which simultaneously holds 6 exhibitions such as JAPAN SHOP and ARCHITECTURE + CONSTRUCTION MATERIALS covering 4 fields including design and architecture, successfully took place from March 3 to 6 at Tokyo Big Sight. Establishing itself as a big event in spring, the exhibition attracted 210,610 visitors during the 4 days, and among those visitors, 102,908 people visited the two exhibitions, JAPAN SHOP and ARCHITECTURE + CONSTRUCTION MATERIALS, where wood related products were on display. Canada Wood introduced the products of Structurlam Products LP, a company based in British Columbia, which has continued to lead the heavy timber industry for over 50 years. The company manufactures Glulam, Parallam products, and cross laminated timber (CLT) at 2 factories, and the Glulam is supplied from a JAS certified factory. CLT, which has gained attention as a new generation of engineered wood, has up to now been seen in many examples and is becoming recognized as a world leader. Compiled by the Aichi Wooden Housing Precut Council, the results of precut lumber processing for traditional wooden homes (17 factories) in February was 52,609 tsubo (1 tsubo = about 3.3 m²; 1,450 homes) decreasing 15.6% (Continued on Page 12)

12 Page 12 compared to the same month last year and 1.9% compared to the previous month. Among new housing construction starts, wood constructed, single-family homes especially confronted a severe environment due to the reactionary decrease to the rush-in-demand prior to the rise in consumption tax rate, so the processing results of the association members in February fell largely below the results of the same month last year. The cumulative result for January and February was 106,237 tsubo (2,900 homes) decreasing 17.5% compared to the same period last year. In March, there is work to hand over homes to owners within the fiscal year, but compared to the usual year, the amount of this work is also small with an expected processing of 57,230 tsubo (1,557 homes). On the other hand, one view sees being inactive in January and February and taking off in March, and there is a wide variation among each factory. The decrease in construction starts will continue, and the price competition will become more intense, and the pressure on profits is causing anxiety. The processing forecast for April is increase for 2 factories, slight increase for 2 factories, unchanged for 12 factories, and slight decrease for 1 factory. Compiled by the Tokai 2x4 Council (12 company members), which is comprised of companies supplying components for houses built under the 2x4 construction method, the processing results of its members for February showed panel processing of 285 homes (10,724 tsubo; 1 tsubo = about 3.3 m²) and fixed size shipments of 24 homes (955 tsubo) for a total of 309 homes (11,679 tsubo) falling below the results of the same month last year by 84 homes. The cumulative total for January and February of this year showed panel processing of 555 homes (21,826 tsubo) and fixed size shipments of 46 homes (1,818 tsubo) for a total of 601 homes (23,644 tsubo) falling below the results of the same term last year by 136 homes. The dullness is continuing as before. The amount of decrease was large even after considering the point that in February of last year factories were very busy at the final stage of the rush-in-demand prior to the rise in consumption tax rate. Furthermore, the amount of decrease was large when compared to February in the year before last, and the situation is as if activity has come to a stop. Even in the outlook for the near future, many factory members see a condition of there being no homes for March and April, and with a feeling of no signs of improvement, building materials are starting to see a phase of a rise in prices. A price competition is beginning in one area, and factory members can be heard expressing concern over an extremely difficult condition. A basic policy of the association is not to fall into a price competition, but in the current business scene, adhering to this policy is not easy. The Forestry and Forest Products Research Institute recently held a ceremony for the completion of an experimental building constructed on its site in Tsukuba City, Ibaraki Prefecture. In order to spread the general use of cross laminated timber (CLT) as a construction material, the experimental building will make clear the long term, strength performance of CLT announced on notices related to construction standards law (Forestry Agency commissioned project). The experimental building is a one-story structure built under the wood frame construction method with a construction area of 132 square meters. The roof of the building is made with color coating galvanized steel sheets, the exterior wall consists of ceramic siding, and the walls and ceiling use structural plywood. The building was equipped with a power substation, telecommunications equipment, water supply and drainage equipment, and other equipment, and the construction cost was about 44 million yen. 5 creep testing machines were installed in the building, so the long term performance of CLT will be evaluated. Last year in October, the Forestry Agency and the Ministry of Land, Infrastructure, Transport and Tourism drew up Road map leading to the spread of CLT effective until 2016, and the building is expected to lead to the collection of necessary data concerning strength performance for the preparation of building standards of CLT, which is seen as an important part of the road map. JLJ Website Address Subscription rates (including postage): One year, Japan 38,800; Overseas US$ Publisher: JLJ Inc. Office: 25 Sankyo Bldg. #523, Higashi-Ikebukuro, Toshima-ku, Tokyo JAPAN Phone: Fax: editor@jlj.gr.jp Website