April 2020 International Trade (Softwood Lumber)

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Softwood lumber exports retreated (22 MMBF or -21.3%) in April; imports also fell (163 MMBF or -12.0%). Exports were 39 MMBF (-32.8%) below year-earlier levels; imports were 244 MMBF (-16.9%) lower. As a result, the year-over-year (YoY) net export deficit was 205 MMBF (-15.4%) smaller. Also, the average net export deficit for the 12 months ending April 2020 was 2.9% 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 (45.3%; of which Canada: 31.5%; Mexico: 13.8%), Asia (33.5%; especially China: 16.1%; and Japan: 9.3%), and the Caribbean: 15.9% (especially the Jamaica: 6.1%) were the primary destinations for U.S. softwood lumber exports. Year-to-date (YTD) exports to China were -30.5% relative to the same months in 2019. Meanwhile, Canada was the source of most (86.0%) of softwood lumber imports into the United States. Imports from Canada were 5.2% lower YTD than the same months in 2019. Overall, YTD exports were down 13.3% compared to 2019; imports: -1.8%. 

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U.S. softwood lumber export activity through the West Coast customs region represented the largest proportion (38.3% of the U.S. total), followed by the Eastern (28.5%) and Gulf (22.8%) regions. Seattle (30.1% of the U.S. total) was the single most-active district, followed by Mobile (15.4%). At the same time, Great Lakes customs region handled 59.0% of softwood lumber imports -- most notably the Duluth, MN district (24.0%) -- coming into the United States. 

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Southern yellow pine comprised 28.7% of all softwood lumber exports, Douglas-fir (18.3%) and treated lumber (12.4%) were also significant. Southern pine exports were up 2.1% YTD relative to 2019, while treated: -6.5%; Doug-fir: -13.6%.

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.