Products and Services Overview

Transcription

1

2 Products and Services Overview Our Belief The only way to achieve a true measure and understanding of the market is to collect transactional data. An Exponentially Better Business Model Transaction data is the foundation of all our products and services (opened sales orders, purchase orders, scale tickets). 50,000,000 transactions collected annually. Slide 2

3 A History of Positive Change Our customers make better-informed decisions and thrive because they have reliable and consistent measures of their performance compared to the broader market. Our commitment to deliver the most accurate, credible and quantitative market insight to our customers has never wavered. 2015, Forest2Market, Inc. Slide 2014, Forest2Market, Inc. Slide 3

4 Market Coverage Helsinki, FI Eugene, OR and Coure d Alene, ID Charlotte, NC Curitiba, PR Slide 4

5 Delivered Raw Material Cost Benchmarks Lake States Pulp/chips - 75% Northeast Pulp/chips - 70% Northwest Pulp/chips 90% Logs 70% US South Pulp/chips 85% Sawlogs 75% Brazil Pinus - 45% Eucalyptus 35% Slide 5

6 Fundamental Drivers for Southeast U.S. Long Fiber (pine/conifer) demand growth Growth outside of North America Millennial behavior dampening housing demand Eroding hardwood fiber markets Slide 6

7 Long Fiber (pine/conifer) demand growth Slide 7

8 Growth in Demand by Grade and Market Africa Asia Pacific Europe Latin America Middle East North America Global Market Pulp 1.00% 4.55% -0.97% 7.80% -0.48% 2.38% Newsprint -8.25% 1.09% -2.93% -2.55% 1.18% -6.49% -2.99% Packaging 3.19% 8.50% 1.22% 3.76% 7.73% -0.26% 4.02% Printing and Writing -0.75% 4.95% -1.45% 0.00% 2.26% -4.20% 0.13% Specialties 3.93% 8.93% -1.47% -2.47% 0.13% 1.81% Tissue and Towel 8.34% 12.01% 2.56% 3.92% 9.86% 0.37% 6.18% Courtesy of Fisher International Slide 8

9 Paper A Growing Industry 500 Global Paper Production = 450 million tons 450 Millions of ST Slide Middle East Africa Latin America North America Europe Asia Pacific Courtesy of Fisher International

10 New Pellet Demand - A Significant Increase Softwood Fiber Demand Forest2Market Pellet Production Allocation Model Demand/Production (Year 2020) Million Metric Tons Global Demand 48.9 Less 80% of Asian Demand (Supplied by Asia and Western North America) (4.5) Less 50% of North American Heating Demand (Supplied by Northern US/Canada) (2.6) Net Global Demand 41.8 Less South Production (Operating + Construction, Year 2015) (8.8) Less Other Global Production (Operating, Current) (17.9) Remaining Production Capacity Needed to Meet Global Demand 15.1 Less Assumed Incremental US South Production Capacity (30% of Announced Projects) (3.1) Less Assumed Other Incremental Global Production Capacity (30% of Current Other Global Capacity) (6.0) = 6.0 remaining for US South = 12 million tons of fiber Potential Incremental Production Capacity from US South , Forest2Market, Inc. Slide 10

11 Strong Pulp Demand, Plus OSB Rebound Coupled with Age Class Squeeze, Drives Fiber Prices Higher 140 MM 160 MM 2015, Forest2Market, Inc. Slide 11 Expect pellet demand to add another million tons of pine pulpwood demand by 2020.

12 Strong Pulp Demand, Plus OSB Rebound Coupled with Age Class Squeeze, Drives Fiber Prices Higher Young pine acres are diminishing, driving down effective supply. 2015, Forest2Market, Inc. Slide 12

13 Strong Pulp Demand, Plus OSB Rebound Coupled with Age Class Squeeze, Drives Fiber Prices Higher Young pine acres are diminishing, driving down effective supply. 2015, Forest2Market, Inc. Slide 13

14 FL trends inconsistent with US South Eastern counties Slide 14

15 Growth outside of North America Slide 15

16 Growth in Demand by Grade and Market Africa Asia Pacific Europe Latin America Middle East North America Global Market Pulp 1.00% 4.55% -0.97% 7.80% -0.48% 2.38% Newsprint -8.25% 1.09% -2.93% -2.55% 1.18% -6.49% -2.99% Packaging 3.19% 8.50% 1.22% 3.76% 7.73% -0.26% 4.02% Printing and Writing -0.75% 4.95% -1.45% 0.00% 2.26% -4.20% 0.13% Specialties 3.93% 8.93% -1.47% -2.47% 0.13% 1.81% Tissue and Towel 8.34% 12.01% 2.56% 3.92% 9.86% 0.37% 6.18% Courtesy of Fisher International Slide 16

17 Population Growth Is Far from North America By billion; 4-7% GDP +125 million; 2-4% GDP +400 million; 7% GDP And -34 million; 7% GDP Increasingly urbanized population (1.3 billion) will drive consumption. Slide 17

18 Millennial behavior dampening housing demand Slide 18

19 Modest Population Growth at Home By 2050 Theoretically should add ,000 new single family starts annually to baseline, but +70 million; 2-3% GDP Slide 19

20 Millennials 92 Million Between Peak home buying years years Marriage years old years old Married and own a home (18-31 years) % % % Urban Centric 93% want to own their own homes, but the financials may not make sense: 41% work full-time 50% have less than $5,000 in savings Average student loan debt $33,000 Slide 20

21 Housing Market has Rebalanced Slide 21

22 Housing Market Forecast Slide 22

23 Housing Market Forecast 1.5 MM is our mid range forecast Slide 23

24 Price and Volume Recovery in FL Florida all products 20% $5 15% $4 10% 5% 0% -5% -10% $3 $2 $1 $- -15% Volume % Price $/ton $(1) -20% $(2) Slide 24

25 Pine Sawtimber Production Rebounds in FL Florida Pine sawtimber production (millions of tons) Slide 25

26 Global competition is fierce Global Conifer Wood Fiber Prices Western Hemisphere - Quarterly $55 $50 $45 $10 per ton wood fiber = $40 per finished ton USD per Green Short Ton $40 $35 $30 $25 Brazil US South $ Q Q Q Q Q Q Q Q Q Q Source: Forest2Market, Inc. Slide 26

27 Achieving SC s growth goals Strengths Resource abundance Sawlogs Port infrastructure Competitive pine fiber and sawlog cost World class lumber conversion Forestry friendly environment Weaknesses Global positioning of pulp mills Low replanting rates Slide 27

28 Achieving growth plans Opportunities Export market access Hardwood fiber excess growth Cross Laminated Timbers Biofuels (hardwood focus) Threats Ports Erosion of hardwood fiber markets No/little stumpage price lift Slow domestic economy will provide little demand stimulus Strength of USD Slide 28

29 Forest2Market, Inc Brixham Hill Ave, Suite 550 Charlotte, NC Peter Stewart President/CEO Office: