Weather and Markets Hamper Wood Demand for All Forest-Based Raw Materials

28 01 2010

Flows of wood raw materials declined across products during the 4th quarter of 2009, according to the Wood Demand Report. Typically, mills reduce consumption and operating around the winter holidays; however, mill and procurement managers reported to Forisk that weather, market conditions, and log supplies were all problematic.  According to Seth Freeman, Forisk’s Market Coordinator, “many mills  noted that wet weather in November and December impacted their access to wood raw materials,” as loggers and wood suppliers were unable to operate on forestlands.

Overall, pine grade consumption fell 8.3% during the quarter.  Both pine sawtimber and pine chip-n-saw saw their lowest quarterly consumption levels across the South since Forisk began reporting wood consumption in 2006.  Pine sawtimber consumption at lumber mills alone dropped 3.8% during the quarter.  In addition, pine pulpwood and direct chip purchases decreased 3.1%, with consumption dropping at both pulp mills and OSB facilities.

Looking ahead, we expect consumption to improve during the first quarter of 2010.  Several mills intend to restart operations, and there will be no holiday curtailments.  A drier first quarter would also increase log and timber availability.  According to the ForiskForecast, demand for pine grade in the US South will begin recovering in 2010 and could exceed 100 million tons per year by 2010, returning to 2006 levels of demand.

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