Softwood timber sales up 3.0% year-on-year

Although they were down 1.7% on March, to the end of April, full year sales of domestically produced sawn softwood were still 3.0 % higher than for the year-ended April 2016. Sales totaled 3,095,874 m3 for the year, as housing construction activity begins to slow.

Considered on a monthly basis, sales in April 2017 totaled 210,202 m3, more than 20% lower than for April 2016. This is displayed in the chart below.

Fig 3

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While the month-on-month data exhibits an alarming fall, one month does not a trend make. The next few months will tell the story, which will likely be a downturn, but not of that magnitude. (refer article on Softwood Forecasts)

Equally relevant, the data addresses sales, not production and not adjusted for forward orders, or for inventory. A few shipments can make a large difference, especially in an April that was, as ever, full of public and school holidays.

These effects are observable in the detailed data. In the chart below, year-end sales for each of the main grades are detailed for the current and prior year.

fig 4

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

What the data shows is that the main structural grades continued to experience sales growth over the course of the year, while sales of other grades declined sharply. 

The now dominant Treated Structural H2F saw sales grow 8.3% to 755,121 m3, while the once-dominant Untreated Structural <120 mm experienced sales growth of 1.2% to 743,395 m3. Other than some smaller grades, all other sawn softwood products experienced sales declines.

Of course there is an extent to which producers may have switched from manufacturing other products to supply the structural products that are so clearly in demand. However, it is not entirely clear the extent to which that has occurred.

At its simplest, the sawn softwood sales data is starting to present some inconsistencies between the short-term data and the longer-run and year-end data. All of that implies there is change coming, both to total sales volumes and the products that are being produced and sold domestically.