Chapotelle, D. N.

Western Dry Kiln Association

Western Dry Kiln Association. Meeting (44th : 1993 : Reno, Nev.)

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INTERNATIONAL LUMBER MARKETING TRENDSDan ChapotelleCouncil of Forest IndustriesVancouver, B.C.During the next 25 minutes, I will be covering three areas:1. Lumber Market Supply/Demand Overview.2. The Current EEC Pinewood Nematode Situation.3. An example of Why Kiln Drying will become more important in thefuture.LUMBER SUPPLY & DEMANDLumber supply has exceeded demand every year since 1980, with the slightexception of a 14 month or so period around 1988. Some of the reasons for this areobvious and understood.• The recessions of the early 1980's and the one we are currently working ourway out of have affected housing starts negatively in most countries.• The post World War II tree plantings are reaching maturity in Europe. Themost dramatic example of this is Ireland, where in 1980, they were barelyable to produce 10% of their home consumption requirements. Today, theyproduce over 70% and by the year 2000, they will be self-sufficient involume (not quality). Germany is self-sufficient in softwood constructionquality and France is fast approaching this position. The U.K. are at about23% self-sufficiency and are expected to reach 30%. Additionally, theradiata forests of Chile and New Zealand are growing rapidly. By the year2005, they will have the capability of producing a volume of lumber equalto British Columbia. (This assumes a drop in B.C. of about 25% due toenvironmental and other pressures.)• A little understood reason is the additional volume produced in NorthAmerica due to increased sawmilling efficiencies. While there was asignificant drop in the volume of lumber used in new housing starts in the1980's, the volume of lumber used in the remodelling and refurbishing tradehas more than replaced the new housing starts volume that was lost.What happened is that even though many mills in North America shut downduring the mid 1980's to early 1990's, the lumber recovery from logsincreased dramatically from the remaining sawmills. In British Columbiafor example the average solid wood recovery from logs in 1980 was about43%. In 1990, it was in the area of 49%. This equates to an increase of12% which if you assume all North American Sawmills averaged only halfof this it would result in an increase in supply of 3 billion FBM per year.This is based on a total North American volume of 50 billion FBM. Thegreater efficiency was due to thinner kerf saws, optimisers, improvementin personnel training, and the great motivator called survival.We have now entered an era where the supply/demand is more balancedand once Europe recovers from the recession, demand should exceedsupply.EEC PINEWOOD NEMATODE (PWN)Lumber shipments entering the EC countries on June 1, 1993 or later mustbe kiln dried or heat treated (at least for Canadian production) to 56°C at the corefor 30 minutes. Cedar is exempted. Dunnage, which includes stickers thicker than6 mm, must be free of bark and grub holes and be less than 20% M.C.The Canadians have put forward a proposal to the EEC which was fullysupported by the Americans which involved species differentiation. That is, it wasaccepted that pines and species combinations which include pines were high riskand therefore, it was agreed pines would be kiln dried or heat treated attemperatures of 56°C or greater. The proposal suggested that species with no risksuch as cedar should be totally exempted. Other species which would be classed aslow risk would require verification of no bark and no grub holes. It is the belief ofthe Canadian and American scientists that have been involved with the PWN issuethat this procedure would assure safety of transmission of PWN to the EuropeanForest. A strong Canadian and American lobby is underway to secure acceptanceof this proposal or at least a one year derogation against the EC Directive to enablefurther scientific research to prove the risk levels of the species differentiationproposal.EXAMPLE OF THE NEED TO INCREASE KILN DRYINGJapan, a country of about 125 million people has annual housing starts thathave for several years exceeded the housing starts of the USA. Japan is a vastforest growing nation. 80% of the country of Japan is covered in forests. If theworld cut off lumber and log shipments to Japan, it would have sufficient treestands to survive. The problem is the cost would be high, i.e. can import logscheaper and there would be an extreme shortage of labor.There is little or no appeal for the new generation of workers in Japan toenter work areas known as the 3K's - kitsui (difficult), kitanai (dirty) and kiken(dangerous). Logging, sawmilling and unfortunately construction work falls in thisarea.The average age of the Japanese carpenter is about 55 years old. Thenumber of construction workers in the year 2000 is projected at 350,000 a 45%decrease from the current number. The forecast for the year 2010 projected to be150,000. With such a dramatic reduction of workers in such a short period of time,it can be seen where major changes will have to be made. Misawa Home QualityInstitute predicts that in ten years time, it will take approximately 2 1/2 years tohave a house completed after the order has been placed.House building is gradually changing in Japan. In the early 1970's COFIstarted a program to introduce North American timber frame housing. This systemhas become known as the 2 x 4 system. In 1992, 58,463, 2 x 4 units were built, thisis an increase of 14.6% over 1991. The forecast for 1993 is for 65,000 units andthe rising trend is expected to continue. Nearly all lumber used in this constructionmethod is now kiln dried lumber. (A short slide presentation showing variousconstruction systems was shown. This included 2 x 4, Traditional Post & Beam,apartments and mansion apartments).Most wooden houses built in Japan are still the traditional post & beamstyle (about 60% of all housing units). With the decrease in the work force, therewas a need to replace the skills of hand tool production of the complicatednotching. Nails are not used in the traditional housing but rather a male/femaletype of connector joint is used.In 1975 precutting components for traditional housing was introduced.Today, the complicated notching of one end of a post takes only 10 seconds. Theseprecut plants are increasing dramatically:NUMBER OF PRECUT PLANTS1975 11984 801990 3001993 570Material for a traditional house is produced, numbered, and delivered to thebuilders' site to be assembled much like a Lego or Mecanno set. Most traditionalhouses will soon be built using precut components. In 1982, 2.2% of the total newhomes used precut components in 1991, this increased to 11.5%. In 1992, 80,000houses had notched or tenoned members from precut plants. This trend is expectedto continue much quicker as carpenters age and retire.The problem when producing and numbering the components for a completehouse is, what happens when some of these components change (warp, etc) duringthe natural drying process. How do you economically and quickly replace thesedefective component members when the building site is far from the precut plant?The Japanese way is not to have to replace defective parts but rather to produceparts that are not and will not become defective.This ladies and gentlemen will lead the Japanese into using dry products notgreen products as is the current practice. There will be a need for us to learn howto efficiently dry larger pieces required for traditional Japanese housing.NOTE: SALES PERSONNELCurrent minimum cost of drying in Japan is $200 per M. Sugi (Japanese Cedar)which is a somewhat difficult species to dry, currently costs $300 per M to dry inJapan.3

International lumber marketing trends

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International lumber marketing trends

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