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European and North American log prices continue to rise in September Quarter

Latest international log prices show the value of wood fibre has continued to grow over the last year. Baltic region log prices continued to rise in the September quarter, with latest available data showing prices are up from all of the main supplier countries. 

Baltic region pine log prices have risen over the last year, but appear to have plateaued through the last two quarters. As the chart shows, initially, the price increases were led by Estonian pine, which has corrected over the last two quarters. Regardless, Baltic pine logs from Estonia were USD86.56/m3 in the September Quarter of 2018, up 10.7% on the prior September. Finnish pine logs were 6.1% higher prices over the same period, at USD72.41/m3 and Norwegian pine logs were 3.8% higher priced at USD57.95/m3. All prices are on a roadside basis.

Swedish pine log prices are not up to date, but on a June Quarter comparative basis were 7.5% higher at USD54.46/m3.

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To go straight to the dashboard and take a closer look at the data, click here. 

Meanwhile in the USA, nearly all log grades recorded higher prices over the year-ended June, with some pine logs seeing increases of more than 25%.

Of interest from a direct Australian supply perspective is that Baltic region log prices are rising continuously, while at the same time, exports of the region’s sawn softwood have grown significantly, at least for supply into Australia. 

What do we make of that? Export trade is often secondary to local transactions, because it has additional costs that can be difficult to pass through to end buyers. So, rising input prices can be a signal of stronger local finished goods prices, supported by solid demand and often, demand growth.

Rising exports to Australia, in that context, might indicate that average prices for sawn softwood in Australia are near to satisfactory for this important supply line.

 

Posted Date: October 26, 2018

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