August 2022 International Trade (Softwood Lumber)

Click image for larger view

With August exports of goods and services at $258.9 billion (-0.3% MoM; +20.0% YoY) and imports at $326.3 billion (-1.1% MoM; +13.6% YoY), the net trade deficit was $67.4 billion (-4.3% MoM; -5.6% YoY). 

Click image for larger view

Click image for larger view

Softwood lumber exports rose (16 MMBF or +14.3%) in August, along with imports (98 MMBF or +7.5%). Exports were 21 MMBF (-14.0%) below year-earlier levels; imports: 111 MMBF (+8.6%) higher. As a result, the year-over-year (YoY) net export deficit was 132 MMBF (+11.5%) larger. However, the average net export deficit for the 12 months ending August 2022 was 7.6% below the average of the same months a year earlier (the “YoY MA(12) % Chng” series shown in the lumber-trade graph above).

Click image for larger view

North America (53.2% of total softwood lumber exports; of which Mexico: 29.0%; Canada: 24.3%), Asia (14.1%; especially Japan: 4.5%), and the Caribbean: 21.0% especially the Dominican Republic: 8.5%) were the primary destinations for U.S. softwood lumber exports. Year-to-date (YTD) exports to China (2.6% of U.S. total) were -52.1% relative to the same month of the prior year. Meanwhile, Canada was the source of most (83.4%) softwood lumber imports into the United States. Imports from Canada were 5.6% lower YTD/YTD. Overall, YTD exports were up 1.2% compared to the prior year; imports: -3.1%.

Click image for larger view

Click image for larger view

U.S. softwood lumber export activity through the West Coast customs region represented 31.7% of the U.S. total; Gulf: 31.6%, and Eastern: 26.2%. Seattle (14.9% of the U.S. total), Mobile (16.1%), San Diego (13.9%) and Laredo (8.7%) were among the most active districts. At the same time, Great Lakes customs region handled 57.3% of softwood lumber imports -- most notably the Duluth, MN district (23.5%) -- coming into the United States. 

Click image for larger view

Click image for larger view

Southern yellow pine comprised 21.9% of all softwood lumber exports; Douglas-fir (15.7%), treated lumber (13.9%), other pine (10.2%) and finger-jointed (8.2%) were also significant. Southern pine exports were down 11.0% YTD/YTD, while Doug-fir: +17.3%; treated: +14.9%; other pine: (-1.9%); and finger-jointed: +4.4%.

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.