Wood products are an international commodity, and the forest industry is increasingly affected by global supply and demand trends. Dramatic changes are taking place in the forest ownership of U.S. forest lands as integrated firms liquidate their forest assets. Changes are also apparent in the marketplace.
Pulp and Paper
United States and Canada producers of pulp and paper have reduced softwood and hardwood pulp capacity because of high operating cost. The curtailments and closures of North American facilities have helped push market pulp prices to their highest point since the late 1990’s. Excess supply and weak demand across most grades and regions in the global paper and forest products sector continues.
Chilean pulp and paper feels impact of earthquake
Officials in Chile continue to sort out details on the country's battered forest products sector following this months earthquake. Chile produces nearly 5MM mtons/yr of market pulp, roughly 8% of world supply. Nearly 80% that capacity is located with 100-150 miles of Concepcion. Based on conversations with pulp brokers, Chilean industry experts and others, Duetche Bank put together what they have learned on the impact to the global pulp market. The report includes start up projections, Infrastructure challenges, and global pricing impacts.
Lumber
Makers of wood-based building products remain under pressure from over supply and continued weakness in the U.S. and European housing markets. Residential construction is the largest market for lumber, accounting for more than 40 percent of the lumber used each year. The industry has curtailed production dramatically, to try and bring supply back in line with demand. The year has been marked by employment cutbacks, along with temporary and permanent mill closures.
Plywood and OSB
The housing downturn has also impacted manufacturers of plywood and structured panels. The subprime crisis and resulting home foreclosures has been the major issue impacting new housing starts and structural panel demand. Although a seasonal upturn in the North American construction sector is expected to result in a temporary rise in OSB prices in mid-2009, average annual prices are forecast to remain at low levels.
Energy and Fuel
Woody biomass is expected to play a substantial role in providing new sources of renewable energy and decreasing America’s dependence on foreign oil. Sources of woody biomass are being determined, and the potential areas for new wood markets are being defined. In addition, technological advances are being discovered to convert wood to transportation fuel.
Carbon Sequestration
Global warming can be stabilized by controlling greenhouse gas emissions. Carbon markets are being established and new opportunities exists for Florida’s forest landowners to become a supplier in this new market.
Recycled paper
A record 53.4 percent of the paper consumed in the U.S. (53.5 million tons) was recovered for recycling in 2006. This was the second year in a row that the paper recovery rate has increased. In order to keep up with global demand for recovered fiber, the industry has set a goal of 55 percent recovery by 2012.
The Florida Division of Forestry has developed the Florida Wood Using Industry Directory. This directory is a compilation of over 330 forest-based companies, producers and practitioners. Participation in the directory is purely voluntary, and inclusion does not constitute an endorsement by the Division of Forestry or the Florida Forestry Association. The Division simply strives to provide a concise and thorough listing for potential customers and consumers. http://flame.fl-dof.com/apps/wood_using.php
