Market Outlook Russ Taylor
Market Outlook Russ Taylor
Supply Dynamics
& North America
Outlook
PwC Global Paper & Forest Industry Conference
Vancouver, BC May 11, 2011
By: Russell Taylor
Introduction to:
International WOOD MARKETS Group
We are wood products industry consultants and we
assist companies around the world to develop
operational, marketing & business strategies.
We are known as global market & industry
experts/analysts on timber, lumber, panels & many
millwork products sold in the U.S. market & key
export markets.
Presentation Outline:
1. Global Trends
2. China Impact on BC Industry
3. Other Asian Market Impacts
6. Summary
20,000
Others
x000 m3
16,000
Canada
USA
12,000
Australia
8,000
NZ
Russia
4,000
00
01
02
03
04
05
06
07
08
09
10
Source: CC:
Forecast:
WOOD
MARKETS
Global
Sawnwood/
Lumber
Benchmarking
Report:
2008 Costs
Excerpts
related to
Chinese costs
2011 Report:
Out in May
2011
9
10
Europe:
13. South Sweden
14. Finland
Europe (cont)
15. Estonia
16. Latvia
17. Lithuania
18. Czech Republic
19. Austria
20. Germany
21. Russia: West
22. Russia: Siberia
23. Russia: Far East
So. Hemisphere:
24. Australia
25. New Zealand
26. Chile
27. Brazil
28. South Africa
29. China
Total
Delivered
Log Costs
Sc
st
Co
a
hi
n
C
B
:S
da
PF
SA
U
an
a
C
an
/
he
em
is
p
So
.H
11
W
.E
C
.E
ur
op
ur
op
e
e/
B
al
tic
s
R
us
si
a*
Global Avg
Delv'd Log
Cost
re
150
140
130
120
110
100
90
80
70
60
50
40
30
20
10
0
Intn'l WOOD
MARKETS Group
/ Pw C / Beck; Copyrirhgted
by Intn'l WOOD Markets
Group *Logs at Cost
Thousand m3
12,000
Others
9,000
New Zealand
USA
6,000
Canada
Russia
3,000
Source: CC
2006
12
2007
2008
2009
2010
350
300
Demand
250
Supply
200
150
Gap
(Imports)
100
50
0
2010
2015
16
US$/m3 - net .
$300
$275
$250
USA: BC W-SPF #2&Btr,
2x4 D'lvd Chicago
$225
$200
CHINA: SPF/Hem-Fir,
Green, #3 & Btr 1-7/8x412 C&F
$175
$150
$125
$100
2003
17
2004
2005
2006
2007
2008
2009
2010
2011
US WEST COAST
SAWMILL
650
6.5
100
100
CHINA SAWMILL
(Imported US Logs)
650
6.5
100
55
30
185
ADVANTAGE
ADVANTAGE
ADVANTAGE
ADVANTAGE
ADVANTAGE
ADVANTAGE
SUBSTANTIAL LOSS
ADVANTAGE
ADVANTAGE
MODEST GAIN
WOOD MARKETS
China Bulletin
Monthly Since 2007
Featuring:
Industry Trends &
Analysis, Statistics
+
Import/Domestic Log,
Lumber & Panel
Prices
20
China International
SOFTWOOD Log &
Lumber Trade
Conference
May 9, 2012
Tianjin, China
September 15-16
Plus: Optional 3-Day
Tour of Log Ports, Mills
and Distribution (Sept.
12-14)
21
May 9, 2012
CHINA
Sept. 12-15:
3. BC Interior:
Mountain Pine
Beetle Attack
Report
Forecast:
to 2028
The future of BCs
harvest and wood
products production
produced by:
Jim Girvan
Murray Hall
Russ Taylor
Gerry Van Leeuwen
23
Released: Late
March 2010
BC Interior
Historic
MPB
Report
Low
Billion Bf
12
10
8
6
Medium
High
2
0
80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20
Source: StatsCan; WOOD MARKETS; BC Fibre Model
25
4. Canada
(& US) Lumber
Outlook:
2011-2015
Excerpts from
our latest 5year forecast
26
Released:
Dec 2010
US $/Mbf
$300
$250
$200
$150
Source: Random Lengths
$100
81
83
92
94
96
98
00
02
04
06
08
10
100%
90%
80%
70%
U.S.
60%
Canada
50%
28
11 09
YT
D
07
05
03
01
99
97
95
40%
Source: WWPA/
WOOD MARKETS
1,800
x000 Units
1,500
US
1,200
Canada
900
600
300
Source:
CMHC;
Forecast:
0
80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14
29
WOOD Markets
Million Bf
4,000
Other
China
Japan
3,500
3,000
2,500
2,000
1,500
1,000
Source:
COFI;
Forecast:
WOOD
Markets
500
0
90
30
92
94
96
98
00
02
04
06
08
10
12
70,000
Million Bf or Sf
60,000
50,000
NA Lumber
40,000
NA OSB
NA Plywood
30,000
20,000
10,000
0
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15
31
Source:
WOOD MARKETS
Canada
Capacity
28,000
24,000
Million SF
US Capacity
20,000
16,000
Canada &
US Prod'n
12,000
8,000
Capacity
Curtailments
& Closures
4,000
0
93
32
95
97
99
01
03
05
07
09
11
Source:
WOOD Markets
60,000
60,000
50,000
50,000
Million Bf
70,000
40,000
40,000
Imports
30,000
30,000
Shipments
20,000
20,000
Exports
Consumption
10,000
10,000
0
90
92
94
96
98
00
02
04
06
08
10
12
14
Source: WWPA;
Forecast:
WOOD Markets
70,000
60,000
60,000
Other
Million Bf
50,000
50,000
40,000
40,000
30,000
30,000
Europe
(Nominal BF)
Canada
Shipments
Exports
20,000
20,000
Consumption
10,000
10,000
0
90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20
Source: WWPA;
Forecast:
WOOD Markets
Gap will require higher prices for logs, imported lumber, etc.
34
US $/Mbf
$350
$300
Composite
US$/Mbf
$250
$200
$150
$100
81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15
35
Thank You!
Russell Taylor
RPF, MBA
President