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Sverige Trä Nyheter The US timber market – five things to know

The US timber market – five things to know

The USA is a developing market for Swedish softwood and Södra’s timber is well received. Five key factors explain the context and the outlook.

1.       The US needs to import around 14 million m³ of timber in 2018 outside North America

“Stick frame” houses as they are known in the USA represent the preferred form of construction for the dominant single and two-storey formats and as such the market has a huge demand for timber which it cannot meet with domestic supply. 

2.       Housing starts are recovering strongly

Back in 2008 some two million houses were built in the USA. The economic crisis saw this tumble to 450,000 in 2009, although the issue of lack of housing did not go away. Borrowing is relatively cheap, yet lenders are more cautious than they used to be. The result is a gradual recovery which has led to more than one million homes being built in 2017, a figure which is set to rise by at least 10 percent in 2018. It needs to reach 1.5 million per year to keep pace with demand. 

3.       Supply is tight

The pressure on the world’s lumber basket is widely documented. There have been additional pressures in the USA: “The fire season here was devastating”, says Södra Wood’s sales manager in the US, Bob Jank. “Add to this the pine beetle infestation in British Columbia, exacerbating an import supply gap which the east coast of Canada wasn’t able to fill, and buyers have been left competing for wood.” There are also design changes for areas of high tornado activity and hurricanes where new homes require higher grade strength quality, with the potential for more 2x6 usage in place of 2x4.

Bob Jank.

 

4.       Swedish timber is highly regarded

It is not only a tight supply situation which has caused imports of Swedish softwood timber to the USA to double in the last four years, although this has been a major factor. There is also the appearance and quality of Swedish whitewoods (spruce) which goes down very well with the market and compares favourably with, for example, SPF options from Canada. 

5.       Södra is committed to the US market

Södra’s investments in sawmill capacity and the sustainable and reliable source of wood from members’ forests means that, in addition to its absolute commitment to European customers, the company can also take an enduring position in markets further afield, namely the USA and Asia. “Every three months a Södra vessel docks in Philadelphia and Port Canaveral. Our production is sold up to New York, across to Ohio, down to Miami and across to Mississippi,” says Bob Jank. “Södra is committed to the USA. Its track record has shown it to have a different mentality from a ‘make a buck today’ opportunist attitude. Once Södra commits to a market, it is there for the long term.” Södra’s Värö sawmill is particularly well set up for the CLS production required in North America and the imperial lengths it needs.

Varberg's port.

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