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Macro Pulse highlights recent activity and events expected to affect the U.S. economy over the next 24 months. While the review is of the entire U.S. economy its particular focus is on developments affecting the Forest Products industry. Everyone with a stake in any level of the sector can benefit from
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Saturday, April 9, 2016

February 2016 International Trade (Softwood Lumber)

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Softwood lumber exports increased (+19 MMBF or 15.4%) in February while imports jumped more noticeably (+365 MMBF or 29.1%). Exports were 21 MMBF (17.0%) above year-earlier levels; imports were 655 MMBF (68.0%) higher. As a result, the year-over-year (YoY) net export deficit was 635 MMBF (75.3%) larger. The average net export deficit for the 12 months ending February 2016 was 18.7% higher than the average of the same months a year earlier (the “YoY MA(12) % Chng” series shown in the graph above). 
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North America was the primary destination for U.S. softwood lumber exports in February (35.3%, of which Canada: 17.3%; Mexico: 18.1%). Asia (especially China: 18.7%) placed a close second, with 33.0%. Year-to-date (YTD) exports to China were up 53.4% relative to the same months in 2015. Meanwhile, Canada was the source of nearly all (97.6%) softwood lumber imports into the United States. Overall, YTD exports were up 13.3% compared to 2015, while imports were up 48.1%. 
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U.S. softwood lumber export activity through West Coast customs districts expanded when compared to the other districts during February (to 44.0% of the U.S. total, from 37.2% in January); Seattle maintained its dominance as the most active export district (30.8% of the U.S. total), widening its lead over second-place Mobile, AL (11.2%). At the same time, Great Lakes customs districts handled 70.3% of the softwood lumber imports -- most notably Detroit, MI (24.8%) overtaking typical frontrunner Duluth, MN (23.8%) -- coming into the United States. 
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Southern yellow pine comprised 26.6% of all softwood lumber exports in February, followed by spruce with 12.4%. Southern pine exports were up 19.0% YTD relative to 2015, while spruce exports were up 353.0%.
The foregoing comments represent the general economic views and analysis of Delphi Advisors, and are provided solely for the purpose of information, instruction and discourse. They do not constitute a solicitation or recommendation regarding any investment.

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