EXAMINATION OF WORLDWIDE HARDWOOD LUMBER PRODUCTION, TRADE, AND APPARENT CONSUMPTION: 1995-2013

Worldwide hardwood lumber production fluctuated between 1995 and 2013 and changed considerably with respect to regional market shares. Similarly, worldwide hardwood lumber imports and exports have been constantly changing. Understanding these changes is important because collectively, they define the hardwood lumber consumption of a region or country. In 1995, North America accounted for 25% of worldwide hardwood lumber production whereas East Asia and Oceana (EAO) produced 26%. In the current century, a decline in production in the United States and increased production in China and Vietnam resulted in the EAO region accounting for more than 48% of worldwide hardwood lumber production in 2013. Much of the international trade of hardwood lumber is carried out by EAO and European countries and is intraregional among countries within these regions. Hardwood lumber consumption generally has been moderately to poorly correlated with population at the country level since 1995 and uncorrelated with gross domestic product. However, several other factors also appear to affect current consumption including loss or gain of secondary hardwood industries, age of the population, urbanization, and in recent years, slow economic growth in countries with high per capita grossnational product

An Examination of the Relationships Between Hardwood Lumber and Stumpage Prices in Ohio

Understanding the relationship between hardwood lumber and stumpage prices is critical in evaluating market efficiency and in understanding the potential impact of changing technology on stump-age markets. Unfortunately, the complexity of the hardwood lumber market and lack of reliable data make it difficult to evaluate this relationship using traditional econometric systems. However, the relationship can be evaluated using economic theory, a review of market history, and statistical procedures. This paper first presents a theoretical development of the demand and supply of hardwood stumpage and then examines the history of the white oak, red oak, yellow-poplar, and hard maple markets between 1970 and 1995. Using this information, a multi-period market margin model was developed. Analysis of short-term relationships between lumber price and stumpage price revealed that these series did not always move in the same direction, but tended to move in the same direction when there were large changes in lumber prices. However, continual declines in lumber prices did not always result in continual declines in stumpage price because of apparent price expectations of the stumpage owner. In the long run, the market margin between stumpage and lumber price has declined in a discrete manner. These declines are related to periodic increases in lumber production and price that occur at the beginning of the hardwood production and price cycle. Theory stipulates that during periods of declining prices, the less efficient sawmills will be forced out of the market. Following these periods, inventories usually are insufficient to satisfy any increase in lumber demand. Therefore, when demand increases, lumber prices increase sharply causing surviving, efficient mills to increase production and to bid up stumpage prices to new, higher levels. This bidding transfers any short-term economic gains that result from increased production or marketing efficiency to the resource owners

A Logistical Regression Model of Southern Hardwood Lumber Export Participation

A survey of nine hundred hardwood lumber manufacturers in seven southern states gathered information on mill production capabilities, marketing practices, equipment, and products. Models utilizing logistical regression were developed to assess mill characteristics and how they influence participation in export markets. Mill yearly rated production, lumber production of oak species, covered storage capacity, sales manager's education level, and public ownership all were found to have a positive influence on a mill's export participation. Sales to finished products manufacturers, production of grade three lumber, production of pallets or pallet parts, and private ownership were significant in inhibiting export participation. Expansion plans, number of species sawn, age of sales manager, and importance of sales calls to marketing effort were all found not to be significant predictors of hardwood lumber mills' export participation, or lack thereof

Employment Changes in U.S. Hardwood Lumber Consuming Industries during Economic Expansions and Contractions Since 1991

Understanding employment trends is important for discerning the economic vitality of U.S. hardwood lumber users. After a period of growth in the 1990s, employment in industries consuming hardwood lumber has declined in the 21st century. The wood household furniture industry has experienced the greatest decline, with North Carolina, Virginia, and California being the states most affected. Nearly all of the decline in employment in the furniture industry can be attributed to increased importation of this product. Millwork and kitchen cabinets are industries associated with home construction. Both of these industries experienced declines in employment in the 21st century. Employment in millwork started to decline after 2000, while employment in the kitchen cabinet industry started to decline after 2006. While there was little change in the relative regional employment rankings in the millwork industry, Indiana displaced California and Texas to become the largest employer in the kitchen cabinet industry. Employment in the pallet industry has declined in the 21st century, but mostly during the two recessionary periods. The pallet industry was the only industry that had an employment increase after 2009. Ohio was once the major pallet producing state, but it was displaced by California and Texas after 2002

Changes in the International Trade Balance of U.S. Hardwood Products from 1990 to 2013

We examine U.S. exports and imports of hardwood products from 1990 to 2013. These products include logs, lumber, veneer, chips, molding, cooperage, plywood, and flooring. The values of hardwood products exported and imported have fluctuated over the years but have generally increased. More substantial changes have occurred with the countries and regions receiving U.S. exports, as well as with those importing into the United States. The primary region receiving U.S. hardwood log and lumber in 1990 was Western Europe, but today, China is the most important market. East Asia has been the most important source region for U.S. hardwood plywood imports, but the specific sources have shifted from Indonesia and Taiwan in 1990 to China today. The overall balance of U.S. hardwood product trade has remained positive for most of the years examined, with the United States having a comparative advantage in exporting logs and lumber. In contrast, the United States has a comparative disadvantage in hardwood plywood exports

Examination of Lumber Price Trends for Major Hardwood Species

Over the last 40 years, trends in interspecies and intergrade hardwood lumber prices have been erratic. In the early 1960s, high- and midgrade hard maple commanded high prices while red oak was the least valuable lumber regardless of grade. In the 1980s, high- and midgrade oak prices surged, but prices of all grades of maple and yellow-poplar declined. During the 1990s, maple prices increased in all grades while the price of oak increased only in the lower grades. It is important to understand changes in interspecies and intergrade pricing as well as the market forces causing these changes because lumber price reflects the use of these products relative to availability. In turn, relative utilization is used to evaluate and justify the relevance of emerging research problem areas. This paper examines changes in the interspecies prices for the major grades of hardwood lumber and relates these changes to species preferences, end markets, manufacturing processes, and sawtimber supply