Sawlog prices in British Columbia fell to two-year lows in the 4Q/19, but remained higher than those in many competing regions of North America
Wood raw-material costs in British Columbia fell for both sawmills and pulpmills in the second half of 2019. This fall comes after a seven-year period of record high costs on two fronts – high log costs for the sawmilling sector, and high wood fiber costs for the pulp industry. The decline in sawlog prices came as a result of declining demand and generally sufficient log supply for the sawmills in the province.
In the Interior of BC, prices for mixed softwood sawlogs fell from an average of US$78/m3 in the 4Q/18 to US$67/m3 in the 4Q/19. This is the lowest level in two years but is still higher than prices in both Eastern Canada and the US South, according to the Wood Resource Quarterly.
The forest industry in western Canada benefited from reduced log exports in late 2019. In the 4Q/19, shipments to Asia were down 11% q-o-q to just over 1.1 million m3 (see chart). This represented the lowest quarterly export volume since the 3Q/11. The biggest changes from the 4Q/18 included a 24% decline in the export volume of hemlock logs to China, and an increase in Japanese purchase of Douglas-fir logs y-o-y by 43%.
Both export price and export volume declined during 2019. The average price for softwood logs shipped to Asia in the 4Q/18 was US$108/m3, and by the 4Q/19, the average price had dropped to US$96/m3 with the biggest declines seen in logs bound for China.
In the second half of 2019, reduced log exports and lower lumber production in the province contributed to the downward pressure on log prices in Coastal BC. From the 4Q/18 to the 4Q/19, Douglas-fir and hemlock sawlog prices were down by amounts of 20% and 2%, respectively.
Interested in wood products market information from around the world? The Wood Resource Quarterly (WRQ) is a 56-page report, established in 1988 and has subscribers in over 30 countries. The report tracks prices for sawlog, pulpwood, lumber & pellets worldwide and reports on trade and wood market developments in most key regions around the world. For more insights on the latest international forest product market trends, please go towww.WoodPrices.com
Contact Information
Wood Resources International LLC
Hakan Ekstrom, Seattle, USA
Wood Resources International LLC
Hakan Ekstrom
Wood Resources International LLC (WRI), an internationally recognized forest industry-consulting firm established in 1987, publishes a global quarterly wood market report and have subscribers in over 30 countries. The Wood Resource Quarterly, established in 1988, is a 56-page market report and includes prices and trade or sawlog, pulpwood, wood chips, lumber and pellets, and market commentary to developments in global timber, biomass and forest industry.
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