Seattle, WA -- Prices for wood fiber consumed by the pulp industry in North America
have fallen over the past year in all regions of the continent with the exception of the US
South, reports the North American Wood Fiber Review (NAWFR). The biggest declines
have been in the northwestern and northeastern US where prices have fallen between 10-
15% from the 3Q/15 to the 3Q/16.
Wood fiber costs for pulpmills in Canada and the US have fallen over the past year as a
result of higher availability of residual chips from the continent’s sawmills, reports the
North American Wood Fiber Review. The biggest price declines have been in the US
Northwest and Northeast regions, but prices have also fallen quite dramatically
throughout Canada.
In the US Northwest, where a majority of the fiber furnish is sawmills residuals, prices
have fallen 11% in one year but are still higher than the 25-year average price. Current
price levels for softwood chips in Washington and Oregon are the second highest in
North America, behind the Lake States region. The lowest cost regions for chips are the
US South, British Columbia, Alberta and Quebec.
Healthy operating rates at the sawmills in the Pacific Northwest and high chip inventories
at the region’s pulpmills are the major factors behind the recent price declines, and this
downward trend is likely to continue into the 4Q/16. The high supply of residual chips
has resulted in less demand for costlier roundwood chips, leading to declining pulplog
prices. The average prices for Douglas-fir and hemlock log prices were 13% lower in the
3Q/16 as compared to the 3Q/15, according to the NAWFR (www.woodprices.com)
Chips and pulplogs prices in the US South, which have been nearly unchanged for over a
year at levels close to the highest since the 1980’s when NAWFR started tracking prices
in that region, also showed some modest easing during the fall but not to the degree seen
in other regions in North America.
Canadian wood fiber prices, in US dollar terms, have come down substantially from their
record highs in 2012. Pulpmills throughout Canada have become much more
competitive over the past few years and have gone from having the highest wood fiber
costs in North America five years ago to currently having the lowest costs on the
continent.
In British Columbia, wood chip prices would most likely have fallen more than they
have the past year had it not been for the commonly used formula linking chip prices to
the NBSK pulp price, a price that has stayed fairly stable the past year. Copyright 2024 Walden-Mott Corporation All rights Reserved.
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