Trends in markets for forest-based products and consequences for selected countries

The forest sectors in many regions and countries are facing a need to change their structure, due to the development of new markets, emergence of new competitors, and shifts in production and consumption patterns for forest products. This article focuses on recent changes in the trade in these products, on imports and exports of four countries (USA, Sweden, Ukraine and, to a lesser extent, China) during the period from 1995 to 2011. For this purpose we use explanatory data analysis, time series analysis, benchmarking, meta-synthesis and content analysis of scientific and business publications concerning national and global trends in forest product industries. Data sources are various organizations’ databases of international trade in forest-based products in both monetary and physical terms (cubic meters and tons). The results show that the US and Swedish forest sectors are adversely affected by downturns in both their domestic and foreign markets during the study period, while the Ukrainian sector maintains exports of low value-added products at roughly constant levels (except that particle-board exports increase). China maintains production quantities of low value-added forest-based products, but also substantially increases exports of high-value added products. The results may facilitate efforts to forecast future trends and provide useful information and methodological approaches for future studies of interest to industry representatives, policy-makers and researchers

The Republik of South Africa´s forest sector

The South African consumption of paper and paperboard in 2006 was about 2.5 million tons. The total production was 2.9 million tons. (Sweden’s was 12 million tons.) Production of “Other paper and paperboard” was domi-nating (1.8 million tons), other than “Printing and writing paper” and “Newsprint”. The total export of paper and paperboard was almost 1 million tons. (Export of paper and paperboard from Sweden was 10.8 million tons.) The South African consumption of sawn wood was about 2.5 million m3. The total production was about 2.1 million m3. (Sweden’s was about 17.8 million m3.) Total export was almost 1 million m3. (The Swedish’ was 13.2 million m3.) The forest resources consist of three main types: Plantations, indigenous/natural forests and woodlands/savannas. Plantations cover almost 1.3 million ha of South Africa and are one of the largest planted forests in the world. Indigenous forests cover approximately 0.5 million ha. Savannas contribute the bulk of the wooded land area. Depending on how woodlands are classified the area ranges between 29 and 46 million ha. The round wood production was about 30 million m3 solid volume excl. bark, compared with Sweden’s 62 million m3. About one third of this volume is coming from plantations. The industrial use is about 60% (18 million m3) for South Africa and 90% (56 million m3) for Sweden. The rest is used as fuel wood and charcoal. The conifer share of the industrial wood is for South Africa 30% and for Sweden 95%. One advantage for the forest products industry is the well-managed plantations with quickly maturing trees. However, there is a limit for how much land that is suitable for plantations. Another restriction regarding plantation is water supply. The land restitution causes uncertainty about the short term availability of round wood. Thus, supply of wood raw material put an upper limit for the industry’s possibility to expand. Another restriction is electricity supply. Further more, there is a shortage of skilled workers. The sawmilling industry does not show the success story of the pulp and paper industry. Of course the development of the country itself is most important for the development of the forest secto

Factors Affecting Swedish Forest Property Prices

Historically the price of a forest estate has, at least in Sweden, been closely related to the financial return from the estate, but this connection no longer seems to be that strong, other factors that previously had limited influence on prices now add to the price. Factors like site productivity and age distribution affect the financial return of a forest estate but is it obvious that these factors still influence prices as they once did? Over the last 20 years, the price of forest estates has increased dramatically. If development of prices has led to a weakened connection between return and price, could this be explained by the fact that previously price affecting factors have less weight when valuing forest estates? The purpose of the study was therefore to investigate how a number of factors influence the forest estate price; including site productivity and age distribution. The results shows that neither site productivity, nor age distribution have a significant impact on the forest estate price. What mainly influence the prices seems to be the standing forest volume on the estate and region. The development of the prices seems not only to have influenced the relationship between the return from the forest and the prices, but also minimized the influence of factors like age distribution and site productivity. This means that estates that are bought within the same region, at the same price per cubic meter, can have considerably different potential to gain financial return

The logging policy of private woodlot owners

The aim of this study was to analyse a multivariate and non-experimental data sample to determine the factors that influence the logging policy of private woodlot owners in Sweden. The sample was obtained from interviews with some 2 000 woodlot owners. The method of analysis is known as the Automatic Interaction Detector (AID). For a given population, this method can be used to explain the variation in a criterion variable (dependent variable) through the use of a set of predictors (independent variables). The study results establish that in the majority of cases the state of the forest is apparently the most important factor influencing the determination of the cut by the woodlot owners. However, other groupings are considered in the AID "trees", for example, according to whether or not the woodlot owner participates in forest management courses. Of interest here is that none of the following groupings is obtained: farm owners; forest estate owners; owners resident on their holdings; and owners not resident on their holdings. (For the purposes of this study, a farm owner is defined as a person managing a holding comprising both arable and forest land. A forest estate owner manages forest land only and may be either resident on the holding or not. The general term including both categories is private woodlot owners.

The Swedish roundwood market

There are 3 principal groups on the Swedish roundwood market: the suppliers, the intermediaries (vendors) and the buyers. The suppliers include private, public and company forest owners, whose shares of the total forest land area are 50 %, 25 % and 25 %, respectively. The main intermediaries are the nine forest owner associations in the country. About 70 % of the private woodlot owners are members of these economic associations. The buyers comprise two main groups: the pulpmills and the sawmills. The pulpmills are the predominate consumers of wood raw materials. Sawmills are far more numerous than pulpmills and there are a variety of cooperative agreements to which the two categories are party. About 60 % of the total annual cut in Sweden is offered on the open market. Processing of the remainder of the wood is carried out by subsidiary or associated companies of the forest owner. Pricing of the wood is generally carried out during periodic negotiations. During the 1974/75 season, negotiations on the pricing of pulpwood were held in six different areas and, on the pricing of sawlogs, in twelve different areas. The parties to the negotiations are the forest owner associations and groups of buyers or buyers' representatives. The Swedish Forest Service, which manages a large proportion of the public forest land, negotiates directly with the buyers. A disadvantage of the current system is that there is a tendency for wood prices to lag behind the trends in prices of processed products. This can have adverse economic consequences for the forestry sector, particularly during depressed market conditions. An advantage of the price negotiations is the consequent stability of the market

Wood resource dynamics in the Scandinavian forestry sector

The Scandinavian forestry sector is facing a major challenge. After a century of rapid growth - both in forestry and the forest products industry - the sector is approaching a situation where rapid growth will no longer be possible simply because most of the annual forest growth is already being utilized. One may choose to let the forces of the free market shape the transition from rapid growth to moderate growth. Or one may choose to pursue policies that are intended to improve the transition in one way or another. Wood Resource Dynamics (i.e. this volume) describes the historical background for the current situation, both concerning the supply of and demand for wood and concerning existing legislation and management practises. The volume further describes the problems caused by slow growth in the forestry sector, and a discussion of the various policies that can be conceived to soften these problems. A system dynamics simulation model was developed to elucidate the likely future effects of the various policies. The volume proceeds to illustrate how this computer simulation model of the Scandinavian forestry sector can be used in discussions of long term policy for the forestry sector. The general applicability of the simulation model is being demonstrated by adapting the model to the case of Finland. Finally, Wood Resource Dynamics gives a short introduction to the system dynamics method for model building by presenting two applications to concrete, short term problerns in the forestry sector - pulp inventory control and forest stand management