Softwood Sales Update: Structural Timber Remains Steady While Packaging Demand Continues to Grow
FWPA’s latest 12-month rolling sales data show that total softwood sales volumes recovered steadily during FY2025-26, reflecting an improvement in residential construction activity. Total sales reached around 2.73 million m³ in early 2024 before declining through to mid-2025. Since then, volumes have gradually strengthened, rising to approximately 2.70 million m³ by mid-2026, before easing slightly in the latest month while remaining above levels recorded a year earlier.
The trend reflects broader conditions in Australia’s housing market. Higher interest rates and weaker dwelling commencements during 2026 have continued to weigh on residential construction activity, affecting demand for timber products over the past six months. Despite these challenges, the recent recovery in softwood sales suggests market conditions may be beginning to stabilise.
Figure 1: Softwood Sales Volume by Products (12-month rolling data)
Source: FWPA Softwood Data Series
Structural Timber Remains Steady
Structural timber continues to dominate softwood demand, accounting for almost half of total sales volumes. Over the period, structural timber sales have remained relatively stable, fluctuating within a narrow range of approximately 1.30 to 1.35 million m³.
While demand weakened slightly during the housing downturn, the decline was modest compared with other product categories. The resilience of structural timber reflects its close connection to detached housing construction, where timber remains the preferred framing material across much of Australia. Recent months suggest structural timber demand has stabilised, with volumes maintaining around 1.3 million m³ (Figure 1).
Packaging Demand Continues to Rise
The strongest growth has occurred in packaging products. Sales, on an annual basis (12-month rolling), increased from around 590,000 m³ in early 2024 to more than 720,000 m³ by mid-2026, representing growth of over 20% during the period.
Packaging volumes accelerated particularly through 2025 and 2026, eventually overtaking the combined outdoor, appearance, and other product categories. As mentioned in the previous analysis, the increase may reflect stronger activity across logistics, warehousing, freight movements, and supply chain infrastructure. The rise in packaging demand has become a major contributor to the recovery in total softwood sales and has helped offset weakness elsewhere in the market.
Outdoor, Appearance Products, and Export
Softwood products used in outdoor, landscaping, and appearance applications have experienced a decline. Sales fell from approximately 730,000 m³ in early 2024 to around 580,000 m³ by mid-2026. This reduction likely reflects softer consumer demand and reduced discretionary spending, particularly on outdoor improvement projects. Cost-of-living pressures have reduced household spending on decking, fencing, landscaping, and other non-essential housing improvements.
The declining trend has been gradual but persistent, making this category the largest drag on overall softwood sales during the period. Meanwhile, export volumes remained comparatively small and stable throughout the period, fluctuating around 50,000 to 65,000 m³. Although exports contribute only a minor share of total sales, they continue to provide some market diversification for Australian softwood producers.
Softwood Sales Trend
The latest data suggest Australia’s softwood sector may be moving beyond the trough experienced during 2024 and early 2025. Total sales volumes are recovering, supported by stable structural timber demand and strong growth in packaging products. Looking ahead, the pace of recovery will depend heavily on housing construction activity. If dwelling commencements continue to improve and interest rates ease further in the end 2027 or early 2028, structural timber demand could strengthen, providing additional support for overall softwood sales. However, the changing product mix also highlights the importance of end markets beyond residential construction, with packaging emerging as an increasingly important driver of industry demand and growth.
Figure 2: Total Softwood Sales Volume (12-month rolling data)
Source: FWPA Softwood Data Series
