Despite disappointing developments in the U.S. housing sector the past year, lumber production in both the U.S. and Canada has been higher in 2011 than in 2010. Many sawmills in the Western U.S. and Canada have benefitted from the dramatic increase in demand from Chinese lumber consumers and some sawmills are exporting up to 30% - 40% of their production to the fast developing market in Asia, according to WRQ.
The biggest increase in shipments the past year has been that of softwood lumber from the province of British Columbia in Canada. Much of this lumber comes from the massive supply of timber that has been killed by the pine beetle over the past 15 years. The value of lumber shipments from Canada has increased from just $55 million in 2005 to an estimated $1.2 billion dollars this year.
While Canada has drastically raised lumber shipments to China in recent years, the U.S. has instead expanded exportation of logs to Chinese lumber manufacturers. This year, U.S. West Coast log exporters are projected to ship logs valued at more than $900 million, which is up from only $42 million just four years ago.
The U.S. and Canada have not only increased shipment volumes of logs and lumber to China the past five years, they also have expanded their importance in the Chinese wood market. In 2005, only 4% of all softwood logs and lumber imported to China originated from North America. Last year, this share had gone up to 18%, according to WRQ.
Many North American log and lumber suppliers have the opportunity to expand their export sales in the coming years and it is likely that their presence in the Chinese market will grow, WRQ concludes.
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