US softwood lumber imports hit 15-year high, sizable gains in exports

Imports from offshore suppliers fell sharply in the fourth quarter of 2021, North American offshore exports gained ground after a lackluster start

Originally published by Fastmarkets Random Lengths

U.S. softwood lumber imports from offshore suppliers fell sharply in the fourth quarter, extending a second-half fade after a scorching start to 2021 had pushed volumes to multiyear highs.

North American exports offshore, meanwhile, gained measured ground later in the year after a lackluster first half. Unprecedented congestion and delays at ports worldwide slowed foreign trade for much of 2021.

Transportation challenges disrupt supply timelines

Scarce containers and vessel space, steep cost hikes, and extensive disruptions in ground transportation to ports challenged importers and exporters all year. It is unclear how extensively those issues affected shipping volumes.

U.S. imports declined to 479 million board feet in the fourth quarter, down 15% from the 565 mmbf shipped in the third quarter and lagging the same three quarters of 2020 by 26%. Imports peaked at 649 mmbf in the second quarter, which was a 14-year high (chart).

Despite the second-half fade, imports reached 2.2 bbf in 2021, up 10% from a year ago and marking a ninth consecutive annual increase. Last year’s volume was the highest since 2006.

Lumber prices are reaching record-breaking levels

In recent years, historically strong demand and unusually high returns in the U.S. fueled the surge in offshore imports. The Random Lengths Framing Lumber Composite Price has shattered records the last two years. The composite averaged $855 in 2021, up 51% from the previous record of $567 in 2020.

Imports from the 10 largest European suppliers reached 1.6 bbf last year, up 16% from 2020. A second-half decline was clearly evident in European exports to the U.S. Shipments through the third quarter were up 36% compared to the 2020 pace. Strong prices within Europe, soaring ocean freight costs, and extensive shipping delays contributed to the late-year slowdown in exports.

Plantation Pine imports slipped 5% last year to 497 mmbf. First- and second-half volumes were nearly identical. Shipments were most active in the second and third quarters.

Canadian offshore exports declined to 2.04 bbf last year, down 15% from 2020. A 42% plunge in shipments to China offset a 7% increase in exports to Japan and stronger hikes in smaller Pacific Rim markets such as Taiwan and the Philippines.

Southern pine exports active in second half of 2021

U.S. exports overseas climbed to 519 mmbf, up 11% from the previous year. Exports picked up in the second half. The Caribbean market, primarily for Southern Pine, was most active. Shipments to that region increased 19% to 198 mmbf. The gain offset declines in exports to most other destinations.

Learn more on how to access Fastmarkets Random Lengths wood products news, prices and analysis.

What to read next
The US Department of Treasury has released its definition of a Foreign Entity of Concern (FEOC) for the purposes of the Inflation Reduction Act (IRA) – and there are big implications for nickel.
Given the recent mill curtailments some hardwood producers are thinking creatively in order to stay productive
Multifamily housing starts show some sign of life in late 2023, but the overall picture shows a different trend when compared to single-family
Overseas hardwood trade has seen a global-wide downward trend, in addition to reduced domestic demand in the US
Despite slower population growth and lower household formation rates, there remains a shortfall in the housing market, particularly for starter homes in North America
Talks between the European Union and the United States began in October 2021, where both parties announced the Global Arrangement on Sustainable Steel and Aluminium (GASSA), a partnership in which both parties would negotiate an arrangement to combat global overcapacity and climate change. The discussions would include discouraging trade in high-carbon steel and aluminum that […]