Outlook for Sawlog, Pulplog and Wood Chip Prices in Western US and Canada

Transcription

1 Outlook for Sawlog, Pulplog and Wood Chip Prices in Western US and Canada Mapping the Course Annual Conference January 28, 216 Vancouver, Washington Håkan Ekström and Tim Gammell LLC LLC Forest industry consulting services WRI serves the forest sector and forest organizations worldwide. Clients include international forest companies, energy companies, pension funds, TIMO s, the World Bank, AF&PA, FAO, EU, WWF, ITTO and IIED. WRI, established 1987, specializes in supply/demand analysis of forest resources, forest products trade trends, forest industry developments and wood price outlook. The company has conducted consulting work in over 25 countries on six continents. Subscription services Wood Resource Quarterly: a market report, with subscribers in over 3 countries, tracks global wood markets including prices of pulpwood and sawlogs in 23 regions around the world. North American Wood Fiber Review: a quarterly report established in the 198 s follows sawlog, pulpwood, lumber and biomass markets in all major regions in Canada and the US.

2 Outline Timber Harvests and Log End-Uses Log Exports Sawlog Prices Trends Pulplog and chip price trends in Western N.A. Outlook for 216/ Timber Harvests in the US Northwest mmbf Sources: DNR and WRI estimates

3 End-uses of Timber in the PNW Pulp 9% Other, domestic 6% Log exports 14% Lumber 71% 1 Log Exports From Western US to Asia million m China Japan S. Korea 2 Sources: Customs data and WRI estimates

4 Log Price Drivers - US Northwest - Sawlog demand in Asia - Log prices in Russia and New Zealand - Lumber demand in Asia and the US - Competitiveness of the sawmill sector - Lumber production in BC - Pulp and paper prices 125 Sawlog Prices US Northwest Price Index, US$ (1Q/5 = 1) Douglas-fir Hem-fir Source: North American Wood Fiber Review

5 Timber Harvests in British Columbia 1 8 million m End-Uses of Timber in BC Panels 8% Pulp 7% Other, domestic 2% Log exports 1% Lumber 73%

6 million m Log Exports From British Columbia China Japan S. Korea US 1 Sources: Customs data and WRI estimates Log Price Drivers - Canada, West - Lumber demand in Asia and the US - Log prices in the US - Competition from US sawmills - Impact of pine beetle infestation - Log exports to Asia - Operating rates by the sawmilling sector

7 15 Sawlog Prices British Columbia Price Index, US$ (1Q/5 = 1) Douglas-fir Hem-fir SPF Source: North American Wood Fiber Review Some pulplog and chip price trends (and a few drivers that push these values)

8 British Columbia Indexed BC Coast Hemlock = BC SPF/Hemlock Pulplog Indexed Prices Source: NAWFR Coast South Interior North Interior Index BC N Interior SPF = Western Canada Residual Chip Indexed Prices Source: NAWFR Hemlock SPF SPF SPF Pacific Northwest Indexed Douglas-fir residual chip = Douglas-fir and hemlock indexed chip prices at the Lower Columbia River pulpmills DF Residual Chips Hem Residual Chips DF Whole-log Chips Hem Whole-log Chips Western Washington indexed pulplog prices Indexed - Douglas-fir, LCR = Puget Sound Lower Columbia River Puget Sound Lower Columbia River

9 Drivers in 216 In the PNW China and Japan demand for logs and lumber and US housing starts affects PNW lumber production and residual chip generation Wildfire and salvage affects operating hours and short term unscheduled log availability In British Columbia China and Japan demand for logs and lumber, lower annual allowable cuts and degrading sawlog quality affects lumber production and residual chip generation US lumber demand and currency exchange rate, while BC corporations invest in the U.S. South Indexed - Not real pricing,, US$ Indexed Softwood Residual Chip Prices by Region???? Indexed - US South = 85, US $ Indexed Softwood Residual Chip Prices by Region PNW BC Eastern ON/QC US South

10 Questions? Håkan Ekström and Tim Gammell, LLC Seattle and Vancouver, Washington Publisher of the Wood Resource Quarterly and North American Wood Fiber Review