Imports of sawn softwood products have begun to soften in line with the falling domestic market. Meantime, average import prices have also begun to decline, but to date have eased lower, rather than crashing. Continuing a story of the last year, the role of imports appears to have moderated over the last year, playing less of a boom and bust role.
At 824,030 m3 over the year-ended May, total sawn softwood imports were still up 13.7% on the prior year, but had softened for four consecutive months.
To go straight to the dashboard and take a closer look at the data, click here.
The table below shows only the key grades or forms of sawn softwood products, over the last two years. In particular, it emphasises that the major grade, despite its recent declines, saw imports lift almost 41% over the year-ended May.
| Import Code | Description | YE May ’18 | YE May ’19 | % Change |
| 4407.11.10.31 | Dressed, treated Radiata Pine | 47,123 | 44,198 | -6.2 |
| 4407.11.10.40 | Dressed, untreated, Other | 229,445 | 323,289 | 40.9 |
| 4407.11.99.04 | Roughsawn pine (not radiata), untreated, X section <120cm | 37,015 | 132,183 | -3.5 |
| 4407.12.10.13 | Dressed (not pine) | 121,774 | 133,473 | 9.6 |
Given the recent softening in imports, and it coinciding with a market that has turned down, we might have expected average import prices to crash. However, as the next chart shows, the average price of all sawn softwood imports has corrected modestly, but could hardly be considered to have collapsed.
To go straight to the dashboard and take a closer look at the data, click here.
In May 2019, the average price of sawn softwood imports was AUD $521/m3 on a free-on-board basis, only just below the peak for the last year, which was recorded in April 2019, at AUD $540/m3. Still, we can see that the total average price for sawn softwood imports is relatively volatile.
There is however little periodic volatility in the import price of the main import grade, the Dressed, untreated product of species other than pine (4407.11.10.40). As the final chart shows, in addition to less volatility, average import prices for this grade are reasonably closely correlated to movements in import volumes (75.0% according to the built-in calculator on the FWPA data dashboard).
The chart below shows that the dominant grade, Dressed, untreated sawnwood other than Radiata (4407.11.10.40) drove the lift in imports, and just as importantly, is taking the bulk of the declines.
To go straight to the dashboard and take a closer look at the data, click here.
The recent price peak for this mainstay sawn structural timber product was recorded in October 2018 (AUD $432/m3 on an FOB basis), since when it has declined more-or less consistently to AUD $390/m3 in May 2019, to record a fall of 9.7% from peak to current. Over that same period, imports of this grade are down less than 2%. Given the correlation, we might reasonably expect import volumes to fall by around another 6% over coming months, noting that the chart indicates that prices usually lead volumes, but only by a month or two.
Detailed analysis aside, Australia’s sawn softwood imports are declining in an orderly manner right now – and so too is their price. No one will complain about that apparent new market maturity.
