Bainbridge Island, WA (PressExposure) July 11, 2011 -- The latest briefing from Wood Resources International LLC, shows that timber prices in the US and Canada increased by 20 per cent last year due to increasing demand from East Asian markets. The North American Wood Fiber Review claims that softwood sawlog prices have increased steadily over the past two years in all regions of North America.
Some of the largest increases were in the northwest US, driven by the fact that total timber exports from the West Coast to Asia last year were the highest in 14 years. The demand in Asia is being led by China, which has developed an insatiable appetite for raw materials to help it fulfil its economic growth potential.
FRA analyst Peter Collins said, "The demand from East Asia - including from Japan in the wake of the devastating earthquake and tsunami in March - has directly benefited the timber business in North America. Both the USA and Canada are enjoying higher prices for their exported timber, which also means the industry no longer has to rely on growth in the US construction industry, which is still slow, to survive."
Areas in Western Canada are also seeing prices rise more than forestry firms in the East, with prices for timber from trees such Douglas Fir and Hemlock, rising considerably in the past two years (by between 19 and 25 per cent).
Despite the fact that Canadian timber prices have risen so significantly, the country still has some of the lowest cost raw materials in the world, which could be why East Asia is so keen to do business there at the moment. Western Canada has the lowest sawlog prices in the world, according to Wood Resource Quarterly.
Another reason Asia is keen to do business with US and Canadian forestry owners is because Russia has made it increasingly difficult for other nations to buy timber from their forests. As a result, the US and Canadian forestry industries have benefited hugely from the boom in construction taking place in Asia.
Forestry Research Associates
620 Vineyard Lane,
Bainbridge Island, WA 98110
Tel: (206) 316 8394