Annual sales of domestically produced sawn softwood products continued to soften in August, moderating to 3.066 million m3, down 4.8% on year-ended August sales in 2022. Treated Structural grades are faring the best in the gentle downturn that has seen sales of their untreated cousins decline at a far faster rate.
Starting with the total sales volume, the chart here shows the softening that has been underway for around a year now. It is a modest decline by any measure and on a trajectory that underscores the solid demand that continues to be prevalent in the Australian housing economy, in particular. While ever the pipeline of work remains strong, sales of local product will also be strong.
Drilling into the comparison data, between the grades, the second chart demonstrates the underlying strength of Treated Structural <120mm (down 0.8% year-ended August), compared with the untreated Structural <120mm (down 9.7%).
For these two grades (combined they account for 44.8% of total sales), the treated grade is just less than 100,000 m3 per annum greater than the untreated equivalent.
Outdoor domestic and Fencing grades declined 2.1% and 2.4% respectively, or about half the total decline. Their relative strength comes from their importance to the housing sector. Once the house is built, a family next builds its barricades to defend its castle and its follies to enjoy its private parklands.
The year-on-year comparison chart is shown below.
Of the twelve grades used of reporting sawn softwood sales in Australia, over the last year, just two have experienced sales growth. Treated Structural >120mm saw sales lift 6.5% to 71,868 m3 for the year and the ‘Ungraded’ or Utility, Merchandise, Run of Saw grade was up 4.6% to 276,388 m3.
All the other grades were down, including those like Appearance grades that at just 17,658 m3 (-26.0%) are fading into obscurity. The second-smallest grade is Poles, which at 29,513 m3 was down 10.9% over the same period.
Ultimately, the decline of the minor grades reminds us of two things: all attention and effort is on housing and sawnwood supply is under persistent pressure.
