Log costs for sawmills in the US South are among the lowest in the world and have been consistently low for over a decade

Softwood fiber costs for pulpmills in the US South are currently the third-lowest in the world, behind only Latin America and Russia. Sawmills pay less for logs than most regions of North America and Europe. Log costs in the South are not only low, but they have also been relatively stable for a long time. Even in early 2021's red-hot lumber market, sawlog prices remained low and only saw modest regional increases. According to the Wood Resource Quarterly, the steady price trends in the southern states contrasts with other regions of North America and Europe, where sawlog prices were substantially higher in the 3Q/21 than in the same quarter of 2020. The average log price jumped about 50% y-o-y in Western Canada and 12% in the US Northwest. The major lumber-producing countries in Europe saw their log costs increase between 15-65% from 2020 to 2021.

Softwood fiber costs for pulpmills in the US South are currently the third-lowest in the world, behind only Latin America and Russia. Sawmills pay less for logs than most regions of North America and Europe. Log costs in the South are not only low, but they have also been relatively stable for a long time. Even in early 2021's red-hot lumber market, sawlog prices remained low and only saw modest regional increases. According to the Wood Resource Quarterly, the steady price trends in the southern states contrasts with other regions of North America and Europe, where sawlog prices were substantially higher in the 3Q/21 than in the same quarter of 2020. The average log price jumped about 50% y-o-y in Western Canada and 12% in the US Northwest. The major lumber-producing countries in Europe saw their log costs increase between 15-65% from 2020 to 2021.

The average sawlog price for the US South ranged between $61-66/m³ in nominal terms since 2007, a narrow price spread. During the same period, the Global Sawlog Price Index (GSPI), representing 22 regions worldwide, has fluctuated between $71/m³ and $87/m³ (see chart). In 2021, the GSPI has averaged $83/m³, almost $20/m³ higher than the average price in the US South. However, there are intra-regional differences throughout the South, with prices in the Atlantic states generally having increased more than the Gulf states in 2021. Notably, sawlog costs rose between 12% and 22% from the 3Q/20 to the 3Q/21 in North Carolina, Georgia, and Florida, according to the Timber-Mart South.

Are you interested in worldwide wood products market information? The Wood Resource Quarterly (WRQ) is a 75-page report established in 1988 and has subscribers in over 30 countries. The publication tracks prices for sawlog, pulpwood, lumber & pellets and reports on trade and wood market developments in most key regions worldwide. For more insights on the latest international forest product market trends, please go to www.WoodPrices.com

Contact Information

Wood Resources International LLC
Hakan Ekstrom, Seattle, USA
info@WoodPrices.com

CONTACT:
Wood Resources International LLC
Hakan Ekstrom
info@woodprices.com 
www.woodprices.com

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