Ma rke t Situa tion a nd Outlook T r mar knade n i Kar lstad, - PowerPoint PPT Presentation

Ma rke t Situa tion a nd Outlook T r ämar knade n i Kar lstad, 2016- 11- 17 Ma g nus Nikla sso n, Swe dish F o re st I ndustrie s F e de ra tio n

a st ye a rs me ssa g e : We we re wo rrie d a b o ut China L a nd E g ypt a nd b e lie ve d the US a nd E uro pe a n ma rke t wa s the ke y. We still ha ve a n “o ve rha ng ” o f so ftwo o d, whic h c o mb ine d with the lo w se a so n is impa c ting the ma rke ts. But the g lo b a l b a la nc e se e ms to impro ve slo wly… At the mo me nt we ha ve a (ma inly) “re dwo o d pro b le m” g e ne ra te d b y sa tura te d a nd we ake r marke t in China a nd liq uidity pro b le ms in E g ypt c o mb ine d with c o ntinue d hig h Russian supply to tho se ma rke ts ! Co ntinue d inc re a se in USA-c o nsumptio n a nd ste a dy (b ut mo de ra te ) g ro wth in E uro pe is the ke y to b e tte r time s!

Only pa rtly c orre c t! We still ha ve a n “o ve rha ng ” o f so ftwo o d, whic h c o mb ine d with the lo w se a so n is impa c ting the ma rke ts. But the g lo b a l b a la nc e se e ms to impro ve slo wly… At the mo me nt we ha ve a (ma inly) “re dwo o d pro b le m” g e ne ra te d b y sa tura te d a nd we ake r marke t in China a nd liq uidity pro b le ms in E g ypt c o mb ine d with c o ntinue d hig h Russian supply to tho se ma rke ts ! Co ntinue d inc re a se in USA-c o nsumptio n a nd ste a dy (b ut mo de ra te ) g ro wth in E uro pe is the ke y to b e tte r time s!

Chine se sur pr ise ! 2016 the g lo b a l so ftwo o d tra de will re a c h a re c o rd hig h le ve l. Imports of Softwood to China, total. 1200 1150 1100 1050 1000 950 o ns pe r mo nth, tho usa nd 900 T 850 800 2014 2015 2016

T his ye ar : Whe r e ar e we going? L ong te r m: F r e e tr ade in • ge ne r al? E xpansive financ ial politic s? • Mor e spe c ific ally and shor t • te r m: Canada – U.S. – softwood tr ade ? Shor t (and long) te r m: • Cur r e nc y de ve lopme nt?

Initia l move s on the c ur r e nc y ma r ke ts: USD up a nd E ur o down SE K pe r E UR SE K pe r GBP 10,0 14,0 9,9 9,8 13,5 9,7 13,0 9,6 9,5 12,5 9,4 9,3 UR / E K 12,0 SE / GBP 9,2 K SE 9,1 11,5 9,0 8,9 11,0 8,8 8,7 10,5 2014 2015 2016 2016-11-08 2014 2015 2016 2016-11-08 SE K pe r USD SE K pe r CAD 9,5 7,25 9,0 7,00 8,5 6,75 8,0 6,50 7,5 / USD K 6,25 SE / CAD SE K 7,0 6,00 6,5 5,75 6,0 5,50 2014 2015 2016 2016-11-08 2014 2015 2016 2016-11-08

T re nds in So ftwo o d T ra de

T he b e st pe rfo rming ke ts 2012- impor t mar 2016? I n E uro pe a nd g lo b a lly.

T hir d plac e : T ur ke y T ur ke y showe d good • URKE T Y. Imports of softwood pe r month. Se asonally adjuste d. de ve lopme nt up to 2015 60 About +350 000 m3 in 50 • impor t inc r e ase 40 Ukr aine has take n it all… • 30 20 m3 pe r mo nth, tho usa nd 10 0 2012 2013 2014 2015 2016 Russia Swe de n Ro ma nia Bulg a ria Ukra ine

Se c ond plac e : Ge r many Ge rmany. Imports of softwood. Se asonally adjuste d. 90 Ge r many has showe d • 80 stable gains thr oughout the 70 r e c ove r y 60 50 Be lar us and Russia • 40 inc r e ase s, toghe the r bigge r tho usa nd 30 than Swe de n 20 10 0 2012 2013 2014 2015 2016 Austria Swe de n Ukra ine Russia Be la rus

F ir st pla c e : UK Swe de n ha s a lmo st o ne third o f the to ta l ma rke t. Imports of softwood to Unite d Kingdom. Se asonally adjuste d. 250 225 200 175 150 125 100 75 m3 pe r mo nth, tho usa nd 50 25 0 2012 2013 2014 2015 2016 Russia L a tvia F inla nd Swe de n

Globally: U.S. wins USA has gr own mor e than • China L ist pric e (Ra ndo m L e ng ths) SPF 2x4 We ste rn std&b tr i USD a nd SE K up to Good pr ic e s in SE K… • no ve mb e r 2016 USA. Imports of softwood pe r month. Se asonally adjuste d. 450 3000 22,5 2,2 400 20,0 2,1 USD / 1.000 b df 2500 350 2,0 17,5 / 1.000 b df 300 2000 m3 pe r mo nth, millio n 15,0 1,9 250 1,8 12,5 1500 200 10,0 1,7 150 1000 K 7,5 1,6 SE 100 1,5 5,0 500 m3 pe r mo nth, tho usa nd 50 1,4 2,5 0 0 1,3 0,0 -2,5 1,2 2012 2013 2014 2015 2016 USD / 1 000 b df SE K / 1.000 b df Ca na da , hö g e r Ge rma ny, vä nste r Swe de n, vä nste r

Supply

Sma ll produc tion inc re a se in E urope T he inc re a se in supply is b e lie ve d to b e lo we r tha n the inc re a se in de ma nd. Go o d fo r the b a la nc e ! 30 Pr oduktion Pr ognos 2015 (E OS) 2016 25 Ge rma ny -2% +5% 20 Swe de n +2% -1% (-2%) Milj. m3 15 F inla nd -3% +2% (+6%) 10 Austria +4% +1% 5 E ur ope (14 +0,1% +1,8% c ontr ie s*) 0 *E xc l. Russia T yskla nd Öste rrike F inla nd Sve rig e K ä lla : E OS o kto b e r 2016

F inland: Ne w situation afte r te n ye ar s with de c r e asing pr oduc tion. Ne w pulp pro duc tio n de ma nds pulpwo o d, whic h drive s sa wlo g supply a s we ll a nd thus so ftwo o d pro duc tio n. Simila r situa tio n in Swe de n… F innish De ma nd o f Ro undwo o d Ne w a nd c o nfirme d SW lo g s (a c tua l/ fo re c a st) Ac tua l Pulpwo o d (a c tua l/ fo re c a st) SW lo g s (o ld fo re c a st, Me tla 2008) Pulpwo o d (o ld fo re c a st, Me tla 2008)

Russian e xpor ts has inc r e ase d he avily: Ve ry c o mpe titive a nd to da y pro fita b le . But ho w muc h c a n the pro duc tio n inc re a se in the sho rt a nd me dium te rm? Ava ila b ility o f lo g s is the c ha lle ng e ! Russian produc tion of softwood. Se asonally adjuste d. (about 2/ 3 of the total produc tion) Russian E xports of Softwood, total. Se asonally adjuste d. 2,1 2400 2300 Cha ng e : ja n-a ug 16 / ja n-a ug 15: +18% 2,0 Cha ng e : ja n-a ug 16 / ja n-a ug 15: +6% 2200 1,9 2100 2000 1,8 1900 1800 1,7 1700 Mill. m3 pe r mo nth. 1,6 1600 m3 pe r mo nth, tho usa nd *Russia s’ to ta l so ftwo o d 1500 pro duc tio n 2016 is e stima te d to 1,5 a b o ut 33 millio n m3. 1400 1300 1,4 2009 2010 2011 2012 2013 2014 2015 2016 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 K ä lla: Sva nDa ta K ä lla: Pyra b e lisk

How muc h c an the Russian e xpor t inc r e ase ? T he Rub le ha s g a ine d so me stre ng th a g a in a nd the do me stic ma rke t mig ht ha ve b o tto me d. T hus, the c o mpe titive ne ss is no lo ng e r inc re a sing . SE K / RUB Russian Construc tion. Comple te d apartme nts. 180 0,22 0,21 170 0,20 160 0,19 150 0,18 140 0,17 130 0,16 120 nde x I 0,15 / RUB K SE 110 0,14 100 0,13 90 0,12 80 0,11 70 0,10 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2013 2014 2015 2016

Ha rdly c ontinue with the sa me pa c e a s during this first ha lf ye a r! Russia n e xpo rts to China inc re a se d 2.8 millio n m 3 up to Aug ust, c o mpa re d with 2015 (+48%). Russian E xports to China 1300 1200 1100 1000 900 800 700 600 500 m3 pe r mo nth, tho usa nd 400 300 200 2009 2010 2011 2012 2013 2014 2015 2016

Swe dish Ma in Ma rke ts

Swe de n: T he impor tanc e of ME NA is de c r e asing and E ast Aisa inc r e asing. L a st ye a r we b e lie ve d the impo rta nc e o f Ove rse a s ma rke ts to de c re a se so me wha t… Co rre c t whe n it c a me to Afric a a nd Middle E a st But the Stre ng th in Chine se (a nd to so me e xte nt o the r E a ste rn Asia n ma rke ts) we re unde re stima te d T he ME NA ma rke ts a s sha re o f E a st Asia a s sha re o f to ta l Swe d ish e xpo rts. to ta l Swe d ish e xpo rts. 0,33 0,16 0,15 0,30 0,14 0,28 0,13 0,12 0,25 0,11 0,23 0,10 0,09 0,20 0,08 0,18 0,07 0,06 0,15 0,05 0,13 0,04 0,03 0,10 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 K ä lla : Sko g sind ustrie rna

China : L imite d dome stic supply a nd polic ie s on c onstruc tion bring s a hug e pote ntia l T he ne w Chine se po lic y b ring s a sub sta ntia l po te ntia l in wo o d c o nstruc tio n  ”Pre fa b ric a te d b uilding in ste e l a nd wo o d pre fe rre d.”  ”T a rg e t to 2025 tha t pre fa b ric a te d b uilding ha s a 30% ma rke t sha re ”  ”Wo o d b uilding to da y 0,07% sha re . 1% wo uld me a n a no the r 5 millio n m3 so ftwo o d pe r ye a r.” If this be c ome s re a l, it me a ns a n inc re a se in import with up to 3 million m3 e ac h ye ar up to 2020!

T he dome stic mar ke t the be st of all Swe dish mar ke ts! De live rie s ha ve inc re a se d with mo re tha n 1 millio n m 3 pe r ye a r. L e ve ranse r till Sve nska marknade n. Säsongsjuste rade värde n. 600 550 500 450 400 350 ub ikme te r pe r må na d, tuse nta l 300 K 250 2010 2011 2012 2013 2014 2015 2016 K ä lla : Sko g sind ustrie rna

Swe dish pr oduc tion down 300- 400 000 m3 this ye ar . Ma inly re dwo o d in So uthe rn a nd No rthe rn Swe de n, b ut a lso white wo o d will pro b a b ly de c re a se ma rg ina lly. Swe dish Produc tion of Softwood 1600 1550 1500 1450 1400 1350 m3 pe r mo nth, tho usa nd 1300 1250 2002 2004 2006 2008 2010 2012 2014 2016