by Web Editor | Mar 19, 2018 | News
Forisk projects U.S. softwood lumber consumption of 49.8 BBFT in 2018. This represents a 3.7% increase from our 2017 forecast of 48.1 BBFT and is 5.4% higher than 2016 actuals of 47.3 BBFT. Softwood lumber consumption increased every year since 2009, but remained 26.4% below the 2005 consumption high of 64.2 BBFT. U.S. softwood lumber production is forecasted to increase 5.0% to 35.6 billion board feet in 2018. The South drives this growth with production expected to rise 6.4% for the year, reaching 19.5 BBFT. This would be a new high for the region, surpassing the 19.0 BBFT of production in 2005. In the Base Case, the South’s share of national lumber production increases 0.8% to 55% in 2018.
We project U.S. softwood lumber self-sufficiency to reach 71.4% in 2018 as imports level off, and U.S. softwood production increases relative to consumption. We expect net imports to remain stable in 2018 due to physical constraints on Canadian lumber producers and their inability to grow exports to the U.S.: raging wildfires; stagnant softwood lumber capacity; increasing domestic softwood consumption; two new tariffs imposed on Canadian softwood lumber imports in 2017; and reductions in annual allowable cuts.
In the Forisk Base Case, total structural panel consumption increases from 31.2 billion square feet in 2017 to 36.6 billion square feet by 2022, increasing at a compound annual growth rate of 3.3%. OSB consumption is forecasted to rise 3.1% over 2017, while plywood consumption is forecast to increase 2.1%. For context, our October 2017 forecast was 3.5% lower than actuals, while our initial January 2017 forecast came in at 0.9% below actuals.
Each year we update a multi-phased study for estimating U.S. structural panel consumption. We test variables such as housing starts, GDP, population and others. Outputs from all approaches – regardless of the approach, variables, or form – tend to correlate highly with each other. Simpler models performed better; our final model had an R-squared of 0.97. Then, we evaluate results of our model relative to history and research by the USDA Forest Service and APA-The Engineered Wood Association prior to incorporating the projections into price forecasts for timber and delivered logs across the U.S.
From FORISK Consulting: https://forisk.com/blog/2018/03/15/forisk-research-quarterly-frq-excerpt-2018-lumber-structural-panel-projections/
by Web Editor | Oct 12, 2016 | News
From: Panel World Staff
A report conducted by Forest Economic Advisors and released by Composite Panel Association says that in 2015, the total (direct, indirect and induced) impacts of U.S. CPA-member composite panel manufacturing on the U.S. economy were $7.05 billion in output, employment of more than 22,500 and wages of $1.45 billion. The Canadian composite mills’ impact on the Canadian economy were $3.41 billion (Can), employment of almost 11,500 and $724 (Can) in wages.
“Economic Impact of U.S. and Canadian Composite Panel Mills” also reveals that in 2015 37 U.S. CPA-member mills had sales of $2.30 billion and 12 Canadian mills had sales of $1.34 billion (Can).
The report estimates that U.S. and Canadian composite panel facilities consumed 8.3 million dry tons of residual fiber in 2015, out of total residual supply of 76 million dry tons. On a regional basis, composite panel mills in the U.S. South consumed the most wood fiber, accounting for 2.8 million dry tons, 34% of the total in 2015.
Other findings:
— Resin costs account for 30% of composite panel production costs.
— Energy costs account for 10-20% of costs.
— Value-added shipments accounted for 31% of North American particleboard ships in 2014 and 18% of MDF shipments. For particleboard, the biggest value-added product was thermally fused laminate panels, accounting for 66% of value-added particleboard shipments.
— In 2015, the 42 composite panel mills operating in the U.S. and 12 in Canada had total capacity of 8.15 billion SF (five of these U.S. mills were not CPA members).
— In 2015, North American composite panel shipments hit 5.97 billion SF, 31% below the pre-recession mark of 8.64 billion SF, but a gradual improvement over 5.23 billion SF in 2009.
Read more in the November issue of Panel World magazine…
by Web Editor | Dec 21, 2015 | News
New WOOD MARKETS five-year forecast calls for continued volatility as North American and global lumber markets continue to recover and grow.
In WOOD MARKETS’ new five-year forecast, the short-term outlook is that North American and global economies, as well as softwood lumber and panel markets, are all forecast to improve, but at a much slower pace than has been expected. What has also short-circuited the prospects of stronger demand is a slowdown in China and Japan, impacting export markets. And the new wildcard that caused U.S. dollar prices to plunge in 2015, especially in softwood lumber, was the rapid currency devaluations of almost all major lumber producers as compared to the U.S. dollar. All of these factors have changed the WOOD MARKETS outlook to one that expects more lacklustre demand and corresponding price growth through 2018. After that, it starts to look very good.
These details and further analysis of commodity lumber and panels was released last week in the report, WOOD MARKETS 2016 – The Solid Wood Products Outlook: 2016 to 2020 by International WOOD MARKETS Group, Vancouver BC.
The supply-side dynamics feature eroding sustainable timber harvests in key provinces in Canada, resulting in dramatically lower lumber production than in the previous decade. Canada’s total lumber output will start to flatten out by 2018 with no further increases expected – just as U.S. and global demand are expected to gain momentum.
On the U.S. side, the U.S. West Coast region continues to watch log export prices in China and Japan, as many domestic log prices are correlated with export prices – this can quickly tighten the wood supply for sawmills and plywood mills as export prices rise. The U.S. South is forecast to be the only region where any significant lumber and panel production will occur, mainly due its ample, under-utilized timberland base of southern yellow pine. As lumber and panel demand increases, it is forecast that the current depressed log prices will start to move higher to feed incremental wood consumption of the expected additional panel and sawmill production.
From Wood Markets: https://www.woodmarkets.com/global-malaise-in-demand-coupled-with-rising-production-stalls-price-movement-in-north-america/
by Web Editor | Dec 9, 2015 | News
Massive U.S. industrial wood pellet exports to meet green energy goals in Europe is not a threat to the sustainability of U.S. Southern forests, says a new report from the pellet manufacturers.
Drawing from U.S. government and available market data, the report was commissioned by the U.S. Endowment for Forestry and Communities, National Alliance of Forest Owners (NAFO) and the U.S. Industrial Pellet Association (USIPA) – three organizations representing the producers of wood pellets and their suppliers.
The report reveals that industrial pellet exports represent a very small part of forest harvests in the U.S. South, the groups say. Panel manufacturers have expressed concern that drawing too much wood pulp for fuel will raise prices on raw material for OSB and plywood.
• Total removal of wood in the U.S. South for all markets is 3.3% of the total forest inventory.
• Pellet exports represent 0.08% of the total inventory.
• In 2014, pine removals for industrial pellet production totaled 3.7 million tons or 0.3% of the pine pulpwood inventory and 0.09% of the total pine inventory.
• In 2014, hardwood removals for industrial pellet production totaled approximately 2.4 million tons or 0.2% of the hardwood pulpwood and 0.06% of the total hardwood inventory.
• In 2014, pellet exports from the U.S. South to Europe, which represent the vast majority of U.S. pellet exports, were 3.6 million metric tons, or 40% of Europe’s 9 million metric ton industrial pellet consumption.
• Future industrial demand for U.S. pellets overseas represents 0.3% of total forest inventory in the U.S. South.
From Woodworking Network: https://www.woodworkingnetwork.com/wood/pricing-supply/infographic-using-wood-pellets-fuel-no-threat-forests-or-panel-makers?ss=wood,wood,wood_of_the_month,wood,pricing_supply,wood,components_sourcing,wood,panel_supply,wood,wood_veneer,wood,lumber_quotes_charts
by Web Editor | Feb 11, 2015 | News
From: Panel World Staff
Norbord Inc. and Ainsworth Lumber Co. Ltd. announced that the Supreme Court of British Columbia has granted a final order approving the previously announced merger of Norbord and Ainsworth. Meanwhile Norbord and Ainsworth are providing the U.S. Dept. of Justice with the information it has requested about the transaction. Subject to the satisfaction of all closing conditions, the transaction is expected to close by the end of the first quarter.
The merger would create the largest OSB producer in the world with an OSB production capacity of 7.7 billion SF, according to the companies.
Norbord, based in Toronto, operates seven OSB North American mills, (six of them in the U.S. South) with one mill in Quebec, along with four mills in Europe. Ainsworth, based in Vancouver, BC, operates four Canadian OSB mills—three in Western Canada and one in Ontario. Prior to this transaction, Norbord reported it was third in OSB production capacity behind Louisiana-Pacific and Georgia-Pacific.
The new company will have opportunities to increase capacity through the expansion of Norbord’s OSB production in Western Europe, the restart of Norbord’s two idled mills in North America, and the completion of Ainsworth’s second line in Grand Prairie, Alberta.
The combined company will operate under the Norbord name. Upon completion of the transaction, Norbord shareholders will own 63% and Ainsworth shareholders will own 37% of the combined company.
Read more on this story in the March issue of Panel World…
