world news - 16.07.2007
North America faces sliding demand for lumber
North American lumber usage stood at 72.8 billion board
feet (bf) in 2006, down three billion bf or 4% from 75.8
billion bf in 2005. A similar reduction is anticipated for
this year, with estimates anticipated to be below 70 billion
bf. Domestic North American suppliers face a demand
reduction of close to 5 billion bf of lumber.
The deterioration of the market applies to the entire North
American continent, but there are important regional
differences. In the US, overall lumber production will
decline by about 1.4 billion bf or some 3.6% in 2007, or
39.0 billion bf in 2006 to an anticipated 37.6 billion bf this
year. While the southern states are expected to experience
only a 2% decline in 2007, the Pacific region may witness
a drop of as much as 5%. Canada’s output fell by only
0.25 billion bf from 34.1 billion bf in 2005 to 33.8 billion
bf in 2006, but is expected to decline by a full 1.0 billion
bf to 32.8 billion bf in 2007.
American housing starts have been advancing almost
without interruption for 15 years, reaching a peak level of
2.07 million in 2005. This enormous construction boom
led to an oversupplied market in 2006, which coincided with a slowdown of the American economy. As a result of
these negative forces, residential housing construction fell
by 12.6% last year to a level of 1.81 million units. The
haemorrhage in the housing market has not yet come to an
end and sources expect an even steeper decline of close to
20% this year. In 2008, the market may be levelling off at
the low number of approximately 1.47 million units.
The housing market in Canada followed a similar trend,
albeit with less severity. Canadian housing starts
culminated last year at 228,000 units but this year they
also entered a phase of decline. The decline is expected to
bottom out in 2008 at about 185,000 units. This would be
18.9% below the previous peak level, but this still
compares quite favourable to a drop of 29.0% in the US.
The weak housing segment was somewhat mitigated by
healthy repair and remodelling activities and advances in
non-residential and industrial construction.
See also:
- — Hawaii timber industry ready to saw
- — Illegal logging — China's big wooden problem
- — Brazil: Civil construction fuels hefty growth in domestic market
- — New unit to test timber
- — Swedish forest industry invests in broadband