Just how important is foreign demand to our domestic forest products industry? Fairly important. In 2021, U.S. forest products exports (excluding paper) were $9.4 billiona, nearly surpassing 2018’s high-water mark. For context, those exports make up about 8.5% of the $110.1 billionb produced by our domestic wood products sector each year. Although Japan was once our top export destination (1990-1997), Canada and China claim that distinction today. Total forest products exports were up 27% in 2021 vs 2020, are up 12% year-to-date (YTD) so far in 2022, and were up 27% this month vs last month. All told, we’re enjoying a handsome trend in foreign demand for our forest products.
But, which forest products are those foreign countries buying from us? Further below, you’ll note – despite the classification constraints – hardwood lumber, softwood lumber, softwood logs and hardwood logs make up the top-4 identifiable single-product groups, as of the most-recent Foreign Ag Service (FAS) data.
Below, you’ll note China took over the top export-destination slot for U.S. hardwood lumber exports in 2009, after Canada held that distinction for decades. As you’d expect, given their prominence in our hardwood forest, both red oak and white oak are the #1 and #2 species among U.S. hardwood lumber exports. Both 2021 and 2022 showed strong growth in foreign demand for our hardwood lumber, with 2021 outpacing 2020 by 25%. YTD 2022 demand is up 21% while month-over-month demand growth was 12%. All positive trends.
Looking deeper into the species-preferences for each of the top-destination countries, we find the following: China (red oak, followed by walnut, then white oak); Canada (red oak, followed by maple, then “other”); Vietnam (yellow-poplar, followed by white oak, then walnut); Mexico (“other”, followed by hickory, then red oak). The Foreign Ag Service reports lump certain species groups like “birch” and “maple”, or “other”, precluding our deeper inspection to find trends among/between soft maple vs hard maple, or yellow birch vs black birch. Interestingly, the U.K., Japan and Germany rank #5, 6 and 7, respectively, and each have year-over-year U.S. hardwood lumber demand-growth-rates over 25%.
Similar to hardwood lumber exports, China is also our #1 country-destination for U.S. hardwood log exports, followed by Canada, Vietnam and Italy. Foreign demand for our hardwood logs was up 31% in 2021 vs 2020, and up 11% YTD in 2022.
Although walnut makes up a small proportion of total U.S. hardwood forest stocks (relative to red oak and white oak), walnut was the #1 species for U.S. hardwood log exports in 2021 and year-to-date (YTD) 2022. When parsing individual export-destination-countries’ respective #1 species, we see the following: China (walnut, followed by red oak, then white oak); Canada (maple, followed by red oak, then birch); Vietnam (white oak, followed by “other”, then red oak); Italy (walnut, followed by yellow-poplar, then “other”).
Comparing the hardwood log export discussion (here) to the hardwood lumber export information in the prior section, readers will note that each of our top hardwood lumber-export countries has a slightly different species-preference for logs vs lumber. For example, Canada tends to prefer maple when they purchase our logs, but prefers red oak, when they buy our hardwood lumber. And, despite the strong domestic demand many of our readers are seeing for their white oak logs, comparative species trends among U.S. hardwood log exports (2021 vs 2022) shows maple and other species are subtly gaining share from red oak, white oak and ash.
Foreign demand for U.S. softwood logs and lumber were up sharply in 2021 (34% and 56%, respectively). Softwood lumber exports are up 21% YTD, and up 17% compared to last month. And, although Softwood log exports are currently down 10% vs this same time last year, month-over-month demand growth is a positive 24%, suggesting 2022 may ultimately outpace 2021.
Thank you for spending some time with us today.
If you are interested in selling your timber, or just have questions about the timber markets generally, don’t hesitate to give our foresters a call.
Your FORECON team is dedicated to helping you make your project a success!
a Foreign Ag Service GATS database 1990-2022
b 2020 U.S. census