Softwood imports ease as prices hold up

Sawn softwood imports fell sharply to 39,093 m3 in April 2019, recording their lowest volume in more than two years and falling more than 25% compared to the prior month. Meanwhile, the average price was unaffected, shifting up to a new mid-term high of AUDFob539.86/t.

The chart below shows total imports of sawn softwood products, along with the weighted average price over the last decade.


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

It is clear to see that import volumes have fallen steeply in recent months, partly off the back of over-extended imports from late 2018. But it is also plain to see that the orderly sell-down of that significant inventory has had almost no impact on average prices. In past, we might have expected to see prices plummet as traders chased volume, at the expense of price.

All the more remarkable because when we drill into one of the largest import grades – Roughsawn Structural, Untreated, (Other than Pine), <120mm – we can see, as the chart below displays, that volumes plummeted and prices headed south over the last few months. With that weight dragging the average down, it is astounding the average price did not also fall.


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

Imports fell to just 3,352 tonnes in April, at an average price of AUDfob393.03/m3. That was 6.7% lower priced than the prior month, but the volume was down a whopping 64.2% month-on-month.

You can hardly notice that on a year-end basis however, such has been the strength of softwood imports over the last few years. 

As the next chart displays total imports have never been higher and continue to be strong despite the recent falls. 


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

It is pretty hard to escape the influence of the big orange band in the middle – the Untreated Dressed, other than Pine – which is essentially supply from Europe. At 336,559 m3 over the year-ended April 2019, those imports were almost 56% higher than for the prior year.

Examining them further, we can see in the chart below that over the last two years, the contributing nations were joined by supplies from Germany and Russia.


As the table shows, starting from a low base, the German imports in particular have grown to a strong position in next to no time!


  YE Apr '18 YE Apr '19 % Change
Austria 20,265.0 36,122.0 78.2
Russia 9,881.0 39,458.0 299.3
Germany 9,712.0 48,028.0  394.5
Estonia 96,982.0 100,735.0 3.9
Finland 21,673.0 28,865.0  33.2
Lithuania 32,434.0 37,274.0 14.9
Sweden 22,943.0 40,400.0 76.1
Other 1,943.0 5,677.0  192.2

What does this data tell us about the Australian market?


Confronted by rapid growth in imports, from new participants, average prices not only failed to fall – they grew over the last two years. That is a function of a mature and capable market that understands its fundamentals better than ever and is operated largely on rational grounds.