HARDWOOD MARKETS MATTER

www.hardwoodreview.com

Hardwood Markets Matter, and it is important for NHLA to share market details of the entire Hardwood Industry. We appreciate the support of allied associations and publishers in gathering and sharing this important market information that can help you understand the complete hardwood industry picture.

Cherry Prices vs. Export Volumes to China

Cherry prices have turned higher since early February, with Appalachian KD 4/4 90/50 Red prices for FAS/1F, #1 Common and #2 Common up $265, $130 and $65, respectively, through the end of March. With the exception of #1 Common, percentage gains in KD prices have exceeded green increases. The price uptick ends a downward trend that started late last spring, and tracks closely with trends in Cherry lumber exports to China, with roughly a four-month lag between export trend shifts and price reactions.

U.S. Cherry prices fell last summer and fall as demand from China declined, with exports shrinking to a nine-month low in September. Shipments to China rose in Q4 2022, however, and January volumes reached a six-year high of 7.9 million board feet. For several years, sawmills had avoided sawing Cherry in favor of species that were more profitable and had broader-based demand—even more so when Chinese demand slumped last June through October. That lack of production contributed to higher prices once Chinese demand increased. Exporters now believe Chinese purchasing will remain strong at least through late-spring. Canadian demand for U.S. Cherry rose steadily in 2022, but the unit value ($/MBF) of 2022 shipments was 23% lower than in 2021, reflecting lower second-half prices and likely a downward shift in the grade mix, as well. That trend continued into January 2023, leaving China as both the largest (89% of January exports) and one of the highervalued global Cherry markets.