lr,S. softwood shipments rise to international markets

'T'u INTERNATIoNAL MARKETPLACE

I for U.S.-oroduced softwood lumber is one of the few lumber markets that have continued to grow over the past few years.

As recently as 2005, during the height of the U.S. housing market, international markets dropped to $449 million and 76,424,000 bd. ft. By 2008 the market had climbed to $584 million and 86,814,000 ft. After a small retreat in 2009, exports for 2010 were 5l7o ahead and expected to top the 2008 figures, at $600 million.

Af l EyeS On China

One success story to emerge from an otherwise slow third ouarter of 2010 is the sharo increase in softwood lumber exoorts. Offshore business has been good in a number of countries with an overall increase in the third quarter of 52o/o over the same period a year ago, according to Random Lengths.

0f particular interest is the volume going to China, as exports there more than doubled last yea/s numbers.

byBobMaurer,swansonGroup

ation. EBPA is a nonprofit trade group whose members are interested in oromoting western-style construction, U.S. building products, and related services in international markets.

U.S. softwood producers are still small suppliers in the international markets. Europe, Canada, Chile and New Zealand are the major exporting regions or countries for softwood lumber products.

Bolstered in large part by our weak dollar and increased taxes on Russian logs coming into the country, the Chinese have been looking more and more to U.S. mills to provide the products they need to satisfy their appetite for wood fiber. And with domestic prices at record lows, many producers see the China market as a better alternative.

One result of this flurry of business is that new floor levels have been established for domestic orices.

Recently, a number of producers and exporters took part in a trade mission to China that was organized by the Evergreen Building Products Associ-

EBPA has worked in conjunction with the U.S. Department of Commerce to create the U.S./China Build program, and they have been conducting two "missions" a year to China since 2001. The program consists of seminars presented in different cities to promote, educate and illushate the value of U.S. building products and building techniques. The program regularly attracts close to 400 designers, architects, builders, distributors, remanufacturers, landscapers and students.

While this program may not be responsible for the recent surge in business in China, it has certainly been busy laying the ground work to familiarize the end users in China with U.S.based products.

Fifteen companies participated in the most recent U.S./China Build program last October (photo above).

International markets requirements are widely varied by species. sizes. grade requirements, and end use of the materials. Traditional U.S. structural species, such as Douglas fir and hemlock, are found in many non-structural products. Lower grades of all species, which have limited value in structural applications, find a home in crating, pallets and packaging. They are used in many remanufacturing and gluing facilities, in parts of the world with much lower labor rates, for furniture and millwork components.

Wood frame residential construction is mostly limited to North America, Japan and parts of Oceania. Even in those markets, the North American framing system using 38mm x 89mm (2x4) structural members is limited to the U.S., Canada and a small segment in Japan.

Japan is the second largest woodframe building country in the world, but of the almost 500,000 wood frame units in Japan last year, only 91,000 were 2x4 based. The vast majority were traditional Japanese metric postand-beam timber construction using metric sizes.

Most of the U.S. softwood exported is for non-structural uses. Interior applications, such as doors, windows, frames, moulding, flooring, paneling and other millwork, is a prime destination for pine and fir species. Furniture parts and glued panels are also a destination for softwood lumber.

Douglas fir and hemlock in the clear and other upper grades are prized in Europe for wooden window and door parts and frames. Ponderosa and other western pines are used in rustic pine furniture and for upholstery frames in Mexico, China and Vietnam.

A large portion of exported lower grade softwoods is used in concrete forming for forming, wailers and support posts. Much of the worldwide structural construction is based on the use of concrete, so there is large demand for formwork materials at all levels.

The Pacific Rim is the leading market for western species, and Japan is the leading destination. Japan is the major export market for U.S.-produced Douglas fir, importing $77 million (98,435,000 bd. ft.), which was 50Va of all Douglas fir exported in 2009. The vast majority of the product is in metric sizes and lengths for post and beam construction. For 2010, exports are on track to increase by more than 6OVo over 2009.

China is another market that has grown over the past five years. In 2005, American lumber exports to China were $23 million (33,072,000 bd. ft.) and rose to $35 million (49,566,000 ft.) in 2009. With the change in the Russian export taxes, China is looking to the west for increased supply for raw materials and low-cost remanufacturing stock. Hemlock was the leading U.S. species imported in 2009 at $7.5 million (13,356,000 ft.), which is 29Vo of all hemlock exported. By December 2010, shipments had already surpassed 2009 totals, running l05Vo ahead.

Mexico is the second largest market for western species. Its imports have followed the U.S. economy downward, from $102 million in 2006 to $83 million in 2009. But 2010 looked to be a strong turnaround, running at 3JVo over 2009, with the market value topping $100 million again. Mexico is a low-grade market for ponderosa pine. Uses include furniture components, pallets and millwork.

Canada is a perennial top destination for U.S. softwood species, but there is limited data as to how much is transported to the Pacific Rim via Vancouver and to Europe via the St Lawrence, although anecdotal data points to a large percentage.

Looking at all U.S. softwood exports by region and leading country, Canada and Mexico are by far the leading markets for softwoods, with eastem Asia following.

2009 Softwood Lumber Exports by Destination Gountry Countries

Canada. Mexico

Japan, China, Taiwan

DR, Jamaica, Bahamas

Philippines, Indonesia, Vietnam

Italy, Spain, U.K., Germany