US exports offshore bounced off historic lows in first quarter

North American softwood lumber exports to offshore destinations posted mild gains in the first quarter, sustaining the momentum evident in the second half of 2023.

Canadian exports overseas reached 376 million board feet through March, nearly matching the 379 mmbf shipped in the first quarter of 2023.

Last year, a resurgence in demand from China, especially in the second half, offset fading sales to other destinations and helped Canadian exporters stem a multiyear slide in total offshore exports. Shipments finished 2023 at 1.45 billion board feet, down 1% from 2022.

Trends reversed course in the first quarter. Canadian exports to China fell 17% to 154 mmbf after surging 22% in all of 2023.

Exports to Japan climbed to 105 mmbf, up 26% from the year-ago pace. Western S-P-F exporters have captured a growing share of the Japanese J-grade market in 2024 from European suppliers. The Red Sea crisis disrupted trade between Europe and Japan by extending shipping times and increasing ocean freight costs.

Further, rising log costs in Europe prompted lumber exporters to raise prices in Japan, providing Canadian suppliers with a price advantage in that market. Shipments to other Pacific Rim destinations fluctuated mildly. Exports to Taiwan, for example, reached 40 mmbf, up 11% from the year-ago pace.

Canadian exports to the US increased 8% in the first quarter to 3.06 bbf. Shipments to the U.S. fell 6.7% in 2022 and 2023.

US exports to offshore destinations reached 113 mmbf in the first quarter, up 28% from the 88 mmbf shipped in the first three months of 2023. Over the previous two years, overseas shipments have hovered at the lowest annual totals since 2006.

Deliveries to the Caribbean jumped 54% to 46 mmbf. Exports to that region declined 4% in all of 2023, falling to 146 mmbf, the lowest annual total since 2009. Shipments to the Dominican Republic surged to 31 mmbf, up 70% from a year ago.

Shipments to China, Japan, and other traditional Pacific Rim destinations were modest and fluctuated mildly compared to year-ago volumes.

Southern Pine exports reached 57 mmbf, up 22% from the first quarter of 2023. The Caribbean remained by far the largest offshore market for Southern Pine. India and Pakistan were among the fastest-growing markets in the first quarter by percentage. Douglas Fir exports were mixed.

Source: https://www.fastmarkets.com/insights/us-lumber-exports-historic-lows-first-quarter/

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