Impact of Pending Export Duties Now Built into the Market; Where are Prices Headed Now?
The U.S. lumber markets are already seeing some major price volatility, where W-SPF lumber prices soared by a whopping 25% (US$78/Mbf) in the three-week period between January 27 and February 17, 2017 and up US$83/Mbf over the previous five-week period.
This three-week price increase in U.S. lumber prices is one of the largest short-term gains over the past 20 years. This is mirroring a similar scenario back in early 2001 when countervailing duties (CVD) on Canadian lumber shipments into the U.S. moved into their 90-day retroactive period in mid-May 2001 and the anti-dumping duties (ADD) followed later. The initial combined duties of 32.3% were both in effect in November, 2001.
The largest U.S. lumber price spike ever, based on price changes in consecutive weeks, was in 2001 – before the implementation of the last U.S. duties – when lumber prices spiked higher by US$165/Mbf over a 7-week period. This was followed by two major price collapses over the next six months: one over five weeks for a drop of US$111/Mbf; and a second over 9 weeks for US$122/Mbf (details are provided in this month’s WOOD Markets Monthly Report). Understanding the possible scenarios and implications of U.S. export duties on Canadian lumber shipments to the U.S., before and after duties are implemented, are critical factors to consider and understand for all players throughout the lumber supply chain!
WOOD MARKETS’ 7th annual Global Softwood Log & Lumber Conference on May 11 in Vancouver BC is scheduled just after the announcement of two key events:
A key focus of industry players is to factor in the impact of these pending duties on Canadian production and exports to the U.S., China, Japan, etc., as well as the direction of U.S. lumber prices and the ripple effect into other key export markets and exporting countries. The North American lumber markets are already volatile and changing quickly – all tied to the pending export duties and the tightening lumber market balance. These unpredictable times are expected to continue for the rest of 2017 and attending the Global Log & Lumber Conference on May 11 will give you the latest updates from our key speakers and participants.
The complete Global Conference program, prices and speakers can be viewed at: https://www.woodmarkets.com/conference/conferences-vancouver/2017-global-softwood-conference/. Early Bird rates are still in effect until March 17.