by Web Editor | Dec 18, 2017 | News
In WOOD MARKETS’ new five-year softwood lumber forecast, the continuation of U.S. duties on Canadian lumber exports to the U.S. are expected to cause more short-term market and price volatility. The preliminary duties launched earlier in 2017 rocked the U.S. market and more of the same is expected in 2018. As we predicted one year ago, the headline for last year’s WOOD MARKETS 2017 news release was bang on: “U.S. Import Duties on Canadian Lumber to Cause Market Chaos and Soaring Prices.” Indeed, they did. The WOOD MARKETS 2018 Outlook Report predicts more chaos and the chance of further record-breaking prices.
These details and further analysis of commodity lumber and structural panels was released earlier this week in the report, WOOD MARKETS 2018 – The Solid Wood Products Outlook: 2018 to 2022 by WOOD MARKETS/FEA Canada, Vancouver BC.
The recent announcement of final countervailing (CVD) and anti-dumping (ADD) duties on Canadian lumber exports to the U.S. will cause lumber prices to remain near record levels in 2018 and even higher at various points over the next five years. This is because Canadian exports to the U.S. are forecast to ease in 2018.
“Simply put,” indicated Russ Taylor, Managing Director, WOOD MARKETS/FEA Canada, “by restricting incremental Canadian lumber exports via import duties, there may not appear to be enough lumber supplies to adequately balance with projected U.S. demand. There will need to major increases in U.S. lumber capacity (which is starting to build), more offshore imports, and/or record-level prices to stimulate more supply. The question that we have seen coming for a number of years is: Where will the U.S. get all of the lumber it needs, and at what price?”
The impact of U.S. import duties on Canadian lumber production and exports has been developed from building a cost curve of Canadian producing regions from WOOD MARKETS’ Global Timber/Sawmill/Lumber Cost Benchmarking Report. From this, WOOD MARKETS has overlaid a cross-Canada timber supply availability map with delivered log and sawmill costs to determine which producing regions (and mills) are most impacted by 20.23% (“all-others”) import duties.
Read more on this from International Wood Markets at https://www.woodmarkets.com/news-release-record-level-lumber-prices-expected-2018-u-s-import-duties/.
by Web Editor | Dec 13, 2017 | News
The likelihood of strong profits from the wood products business, alongside higher prices and growth in paper packaging from increased e-commerce demand, will help to offset the secular declines in the printing and writing paper segment, says Moody’s Investors Service in its annual sector outlook published recently. As a result, the outlook for the global paper and forest products sector will remain stable in 2018.
“The stable outlook for paper and forest products globally next year is underpinned by an expected 2%-4% growth of our rated paper and forest products companies, as strength in the wood products and paper packaging subsectors offset decreased demand for commodity paper as the shift to digital-first alternatives continues,” says Ed Sustar, a Moody’s Senior Vice President and author of the report.
On a subsector basis, the positive outlook for wood products and timberland is buoyed by improving strong end-market demand for timber, lumber, oriented strand board (OSB) and engineered wood products as US housing starts increase about 6%, or approximately 1.28 million units, in 2018.
Bolstered by the robust demand emanating from the US homebuilding market, average lumber prices are expected to remain strong, with increased production capacity aligning to support the demand, Moody’s says. Nevertheless, analysts caution that the tight lumber markets will allow countervailing anti-dumping duties assessed on Canadian lumber exported to the US to be passed on to consumers. The issuers most expected to benefit from a combination of higher lumber prices and little-to-no lumber tariffs include Potlatch Corporation, Georgia-Pacific, Weyerhaeuser Company and Rayonier Inc.
From Moody’s Investors Service: https://www.moodys.com/research/Moodys-Wood-product-growth-supports-2018-stable-outlook-offsetting-commodity–PR_377021
by Web Editor | Dec 11, 2017 | News
The United States International Trade Commission (ITC) ruled that the U.S. lumber industry is materially injured by Canadian government subsidies of their softwood lumber industry.
Voting 4-0 in favor of the U.S. lumber industry, the ITC ruling follows a U.S. Department of Commerce determination that imports of softwood lumber from Canada are sold in the United States at less than fair value and subsidized by the government of Canada. The antidumping and countervailing duties on imports of Canadian softwood lumber products have been collected pending the final demermination of the ITC.
“The U.S. Lumber Coalition fully supports the enforcement of America’s trade laws. The evidence presented to the ITC was clear – the massive subsidies that the Canadian government provides to its lumber industry and the dumping of lumber products into the U.S. market by Canadian companies cause real harm to U.S. producers and workers,” said U.S. Lumber Coalition Co-Chair and Co-President of Pleasant River Lumber Company, Jason Brochu.
“Now, with a level playing field, the U.S. lumber industry, and the 350,000 hardworking men and women who support it, can have the chance to compete fairly.” Pleasant River stamps each board with a Made in USA label at its Sanford, Maine sawmill.
Under the Trump Administration, the Department of Commerce, which operates the International Trade Commission, has been ratcheting up pressure on U.S. trading partners over what it sees as subsidies across several industries, beginning the forest products sector. Last week China was hit with a formal determination by the ITC that it subsidized plywood exports to the U.S., effectively dumping low-priced plywood to the detriment of the domestic manufacturers. The Department of Commerce is expected to pursue solar panel manufacturers in China in coming weeks.
From Woodworking Network: https://www.woodworkingnetwork.com/news/woodworking-industry-news/canadian-lumber-subsidies-harmed-us-producers-trade-commission-rules?ss=news,news,woodworking_industry_news,news,almanac_market_data,news,canadian_news
by Web Editor | Dec 6, 2017 | News
The International Trade Commission (ITC) issued its final determination, activating significant tariffs – nearly 200 percent – on some on imports of Chinese hardwood plywood, voting 4-0 that the domestic industry is materially injured, or threatened with material injury, by reason of these dumped and subsidized imports.
The trade group Coalition for the Fair Trade of Hardwood Plywood, which initiated efforts to get tariffs on Chinese plywood twice before times, commended the unanimous decision by the ITC, as “meaningful relief” for the U.S. hardwood plywood manufacturers. The Coalition says 42 mills have closed many more have had to reduce capacity, with a loss of 52,000 jobs in the U.S., and $2 billion in wages.
“Today’s decision demonstrates that the U.S. Government will not tolerate unfair trade practices and will support American manufacturing and workers,” said Kip Howlett, president of the Hardwood Plywood Veneer Association. “This puts American interests first by standing up to the illegal imports of Chinese hardwood plywood.”
Less exuberant are furniture and kitchen cabinet makers that favor the less expensive plywood from China, including members of Kitchen Cabinet Manufacturers Association (KCMA), and other buyers who have lobbied against the ITC decision, which will lead to high tariffs. KCMA and other members of American Alliance for Hardwood Plywood – mostly distributors of Chinese plywood – expressed shock at the punitive tariffs that were not disclosed until President Trump returned from his recent trip to Asia following meetings with China’s President Xi.
From Woodworking Network: https://www.woodworkingnetwork.com/news/woodworking-industry-news/verdict-china-dumped-subsidized-plywood-injuring-usmills-says-itc?ss=news,news,woodworking_industry_news,news,almanac_market_data,news,canadian_news
by Web Editor | Dec 4, 2017 | News
Congress Gears Up For A Fight Over Mass Timber Legislation
The battle over the 2017 Timber Innovation Act is gaining momentum in Washington, D.C., where two new Senate sponsors and four new Congress members have signed on to it since this past May. The pending legislation would provide funding for research into innovative wood materials and mass timber structures above 85 feet. The bill’s proponents are hoping that it will be an impetus for transforming cities and towns across the country with a bevy of mid-rise and high-rise mass timber buildings.
“I am very impressed with the large cross-aisle support,” Chadwick Oliver, director of Yale University’s Global Institute of Sustainable Forestry, said. “You have Bruce Westerman, a Republican congressman from Arkansas and Peter DeFazio, a Democrat from Oregon who has been on the side of environmental groups. This looks like a bill that is quite serious about moving forward.”
However, the concrete and steel industries are vigorously lobbying to derail the legislation, and have established a website called Build with Strength that contains a detailed critique of the new generation of wood buildings. “It is a piece of legislation that props up one industry over another and we think that it is misguided and dangerous,” Kevin Lawlor, a spokesperson from Build with Strength, said. “We don’t think that it is safe in three-to-five story buildings, and we don’t think that it is safer in taller buildings.”
The wood products industry, the U.S. Forest Service, and other advocates claim that technological advances make the new generation of tall timber buildings more fire resistant. In fact, according to Dr. Patricia A. Layton, director of the Wood Utilization + Design Institute at Clemson University, that is because of the way it chars in a fire: By insulating its interior, an exposed wood beam can actually be structurally stronger than a steel one. “Steel loses its strength at a lower temperature than does wood,” she explained. “If you expose concrete or steel it is combustible, and it does feel the effects of fire.”
Many of the act’s supporters say that allowing buildings to be built from wood technologies such as cross-laminated timber (CLT) will result in a host of economic and environmental benefits. Most of the Timber Innovation Act’s sponsors hail from states where the wood industry is struggling to recoup from the recent housing downturn and also suffering from the decrease in demand for paper that is a result of the increasing digitalization of the economy.
From The Architects Newspaper: archpaper.com
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by Web Editor | Nov 29, 2017 | News
“It’s in time for Thanksgiving, and that’s a good deal.” Kyle Freres imparted sentiments around Lyons based Freres Lumber Company as it announced that Plant 4 is back up and running, roughly four months since a fire destroyed the building amid the hot days of last summer.
“Getting this plant up and going in 3 to 4 months is somewhat of a miracle, especially since we are dedicating a lot of resources to getting our other (mass-plywood panel) plant going,” he said.
Freres, the company’s vice president of operations, said getting back to full operation wasn’t without obstacles. The company started Plant 4 operations more than a month ago, but a major electrical failure scuttled the process, leaving them limping through the past month until they could get all aspects into full working order.
“Looking at pictures of the fires blazing in the building, and the charred inventory, and realizing how recent the fire was illustrates the extraordinary accomplishment of everyone who worked on the project. We want to say ‘thank you’ to those who made this rebuild possible.”
After the fire, Freres offered employees of that plant positions in other locations, such as the company’s plywood mill. Many took the company up on the new, temporary jobs. Some did not but have returned now that the rebuilt facility is up and running. At full capacity, the plant can employ up to 40 workers, and Freres said it’s at about 23 right now, and they are looking to hire more.
From the Statesman Journal: https://www.statesmanjournal.com/story/news/local/stayton/2017/11/27/freres-reopens-plant-destroyed-summer-fire/887774001/
