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Hakan Ekstrom's  Instablog

Hakan Ekstrom
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Mr. Ekstrom is the President of Wood Resources International LLC . The company is an internationally recognized forest industry consulting firm established in 1987, which publishes two quarterly timber price reports and have readers in over 25 countries. The Wood Resource Quarterly, established... More
  • China Imported Logs And Lumber For A Record Nine Billion Dollars In 2013, With North America, Russia And New Zealand Being The Major Suppliers 0 comments
    Mar 5, 2014 12:44 PM

    China's importation of softwood lumber was 19 percent higher in 2013 than in 2012 reaching a new record high. The unprecedented increase in lumber shipments to the Chinese market that began in 2008 is continuing. In 2008, the country imported 3.6 million m3 of softwood lumber valued at 700 million dollars, according to the Wood Resource Quarterly (WRQ). Two years later, in 2010, the volume had increased to 9.4 million m3 and in 2013, China imported close to 17 million m3 of lumber, valued at a bit over 3.6 billion dollars.

    Canada and Russia are the two major suppliers of lumber to China, with Canada having overtaken Russia as the largest supplier in 2010. Together, these two countries supplied almost 80 percent of all imports. However, this year Europe, Russia, Chile and New Zealand have all increased their shipments to China at a higher pace than has Canada. Sweden, for example, more than tripled its export volume from 2012 to 2013 to reach 370,000 m3, or just over two percent of the import volume last year.

    This trend, where countries that just a few years ago were virtually non-existent in the Chinese market are now expanding is likely to continue in the coming years both because China's continued hunger for more wood and because Canada is not likely to expand exports much more than the levels seen over the past few years.

    Importation of softwood logs to China really took off during the second half of 2013. In the 1H/13, import volumes were about 14.8 million m3, and in the 2H/13, China imported 18.1 million m3, an increase of 23 percent in just six months, making 2013 a record year for Chinese log imports. The total value of imported logs reached just over five billion dollars. During the past year, all major log suppliers to China increased their shipments except Russia, which in 2013 shipped the lowest volume since 2004. New Zealand shipments were up by 32% year-over-year, the US increased volumes by 55% and interestingly, Ukraine, which just a few years ago did not export any logs to China, shipped 1.4 million m3 in 2013, a tripling from the previous year, as reported in the WRQ (woodprices.com).

    With record shipments of logs and lumber from North America to China during 2013, it will be very interesting to see if Chinese wood buyers can continue to increase their imports from the US and Canada in 2014 and 2015 when demand for lumber is likely to go up in the US market.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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