Global Timber and Wood Products Market Update - a news brief from Wood Resources International LLC
Lumber and log imports to China slowed in early 2014 but picked up in the 2Q to reach close to record highs; Russian
lumber and New Zealand logs increased the most, reports the Wood Resource Quarterly
Wood buyers in China were more active in the late spring after a slowdown during the winter months. This resulted in
increased importation of logs and lumber during the 2Q, reports the Wood Resource Quarterly. The biggest gains were in
lumber from Russia and softwood logs from New Zealand.
Seattle, USA. A slowdown in the Chinese economy impacted the construction sector in early 2014 resulting in a decline in lumber import
volumes by 16% in the 1Q/14 as compared to the previous quarter. The biggest drop was in Canadian lumber shipments,
which fell to their lowest levels in two years, according to the Wood Resource Quarterly (WRQ). The reduced activities
in the building sector during the winter months also impacted log import volumes to China, but it was more of a break in
the upward trend rather than a decline, with the 1Q/14 imports being about the same as in the 4Q/13.
Later in the spring the economy picked up steam and the GDP rose by 2.0% in the 2Q, up from 1.4% in the 1Q/14. The
annual growth rate is now on target to reach close to 7.5%, which would be slightly lower than in 2013 but still
considerable growth compared to most other major economies around the world. Most of the positive news in the 2Q came
from the industry and retail sectors, while the real-estate market continued to be weak with housing sales being more
than nine percent lower the first half of this year compared to the same period in 2013.
Despite the reduction in house sales, China increased the importation of both lumber and logs in the 2Q with lumber
volumes climbing 19% from the 1Q/14. Russia, which currently supplies about 40% of softwood lumber to the Chinese
market, increased shipments by as much as 32% from the first to second quarter this year. The second largest lumber
supplier Canada, only shipped two percent more volume quarter-overquarter, as reported in the WRQ (www.wodprices.com).
Although Canada and Russia are by far the largest suppliers of lumber to China, other countries are expanding their
sales to this growing market. The biggest gains have been in shipments from Chile and Europe.
Log importation reached an all-time high in the 2Q/14 with New Zealand, the number one supplier, increasing volumes by
15% from the previous quarter. Shipment from the US and Canada were also higher, while log supply from Australia and
Russia fell about five percent in the 2Q. Much uncertainty hovers over how the Chinese economy will do for the rest of
the year but it is not likely that we will see the same bump in wood imports in the third quarter as was the seen in the
second quarter. Rather, the short-term forecast is for a flat line, or even decline in log and lumber volumes landed at
Chinese ports in the 3Q/14.
Global pulpwood and timber market reporting is included in the 52-page quarterly publication Wood Resource Quarterly
The report, which was established in 1988 and has subscribers in over 30 countries, tracks sawlog, pulpwood, lumber and
pellet prices, trade and market developments in most key regions around the world.
To subscribe to the WRQ, please go to www.woodprices.com