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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, May 16, 2020

March 2020 International Trade (Softwood Lumber)

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Softwood lumber exports retreated (6 MMBF or -5.6%) in March; imports rose (290 MMBF or +27.0%). Exports were 8 MMBF (-7.4%) below year-earlier levels; imports were 103 MMBF (+8.2%) higher. As a result, the year-over-year (YoY) net export deficit was 111 MMBF (+9.6%) larger. However, the average net export deficit for the 12 months ending March 2020 was 0.3% smaller 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 (45.8%; of which Canada: 24.7%; Mexico: 21.2%), Asia (26.8%; especially China: 7.9%; and Japan: 8.0%), and the Caribbean: 19.9% (especially the Dominican Republic: 6.0%) were the primary destinations for U.S. softwood lumber exports. Year-to-date (YTD) exports to China were -33.1% relative to the same months in 2019. Meanwhile, Canada was the source of most (88.2%) of softwood lumber imports into the United States. Imports from Canada were 1.9% higher YTD than the same months in 2019. Overall, YTD exports were down 6.4% compared to 2019; imports: +4.8%. 
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U.S. softwood lumber export activity through the West Coast customs region represented the largest proportion (34.6% of the U.S. total), followed by the Eastern (28.9%) and Gulf (26.5%) regions. Seattle (21.8% of the U.S. total) was the single most-active district, followed by Mobile (16.5%). At the same time, Great Lakes customs region handled 60.7% of softwood lumber imports -- most notably the Duluth, MN district (21.6%) -- coming into the United States. 
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Southern yellow pine comprised 30.3% of all softwood lumber exports, Douglas-fir (15.9%) and treated lumber (12.0%) were also significant. Southern pine exports were up 10.6% YTD relative to 2019, while treated: +1.7%; Doug-fir: -8.6%.
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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