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Global Log, Wood Fiber Prices Decline

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First quarter 2012 prices for conifer saw logs fell in virtually all 21 world regions that it covers, reports the Wood Resource Quarterly (WRQ), Seattle, Wash., USA. The prices fell both in local currencies as well as in U.S. dollars. This resulted in the third consecutive decline of the Global Sawlog Price Index (GSPI) to $85.90/cubic meter. The Index was down 2.7% from the 4Q/11 and 8.6% lower than the all-time high in the 2Q/11.

Lower demand for lumber in many markets in Europe and reduced log imports to China were two major factors that pushed log prices downward in the first quarter.

Wood fiber prices fell throughout the world in the 1Q/12, WRQ continues. As a consequence, both the Softwood Fiber Price Index (SFPI) and the Hardwood Fiber Price Index (HFPI) declined to their lowest levels in more than a year.

The HFPI experienced the biggest decline, falling by 3.5% from the 4Q/11 to $109.67/odmt. Since its all-time high last fall, the HFPI has come down 7% in just two quarters. Wood costs were down the most in Europe and Japan. The price premium for hardwood fiber over softwood fiber is currently the lowest since 1Q/11.

The SFPI fell a more modest 0.4 % from the previous quarter to $104.88/odmt. Softwood fiber price trends were mixed, with increases in Oceania, Chile, and the U.S. South and falling prices in Europe, Western Canada, and Japan.

Global market pulp production fell 1.9 % during January and February compared with last year, with Western Europe and North America cutting back more than 3%. Latin America was the only region that increased production early in the year. During the first four months of 2012, hardwood pulp (BHKP) prices have increased faster than softwood pulp (NBSK) prices. In April, BHKP prices were at $760/metric ton in Europe (up $85/metric ton from January) and $820/metric ton ($50/metric or higher) in the U.S. The rise in price for NBSK was more modest, around $30/metric ton from January through April.

Pellet exports from North America to Europe reached a new record high in the 4Q/11. Shipments have increased practically every quarter for four years to almost 600,000 tons in the 4Q/11, as reported in the North American Wood Fiber Review. Pellet prices in Germany, Austria and Sweden moved up slightly during the winter months despite the mild weather and weak demand in Central Europe.

More information is available online.


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