Offshore imports of softwood lumber to the US continued to climb in early 2017 after increasing 43 per cent in 2016, according to the Campbell Group’s monthly Timber Trends Thurday. As Canadian producers have shifted their focus to markets outside of the US, attention has turned to the supply side of the US softwood lumber market and more specifically to offshore imports.
An increase in ffshore imports is one of the expected supply-side responses to constrained shipments from Canada resulting from the countervailing duties levied against Canadian producers. While offshore imports to the US are projected to rise steadily, they will do so from a relatively low volume basis and the limited availability of structural grade lumber shipments from Canada will require increased shipments from countries such as Germany and Sweden that produce structural grade lumber.
US Softwood Lumber Imports: 1Q 2017
However, attracting increased supply from these European suppliers may prove somewhat challenging in light of the strengthening euro, a slowly improving European economy and the well-developed markets and supply chains outside of the US that were created as a result of the collapse in US demand during the Great Recession
Offshore imports accounted for an estimated two per cent or 0.94 billion board feet (bbf) of US domestic consumption in 2016. At this level, offshore imports were up 43 percent over 2015, but were still 69 per cent off their 2005 peak of 3.0 bbf. The lumber from Germany and Sweden is a suitable replacement for Canadian lumber as it can be used in structural applications.