September 2023 International Trade (Softwood Lumber)

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With September exports of goods and services at $261.1 billion (+2.2% MoM; +0.5% YoY) and imports at $322.7 billion (+2.7% MoM; -2.7% YoY), the net trade deficit was $61.5 billion (+4.9% MoM; -14.2% YoY).

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Softwood lumber exports ticked down (1 MMBF or -1.2%) in September, while imports rose (37 MMBF or +3.2%). Exports were 6 MMBF (+5.6%) above year-earlier levels; imports: 70 MMBF (-5.5%) lower. As a result, the year-over-year (YoY) net export deficit was 75 MMBF (-6.5%) smaller. Also, the average net export deficit for the 12 months ending September 2023 was 6.9% below the average of the same months a year earlier (the “YoY MA(12) % Chng” series shown in the lumber-trade graph above).

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North America (57.0% of total softwood lumber exports -- of which Mexico: 37.4%; Canada: 19.6%), Asia (16.1% -- especially Japan; 4.1%; China: 2.5%), and the Caribbean (20.1% -- especially the Dominican Republic: 7.2%) were the primary destinations for U.S. softwood lumber exports. Year-to-date (YTD) exports to China were 56.5% higher than the same month of the prior year. Meanwhile, Canada was the source of most (84.1%) softwood lumber imports into the United States. Imports from Canada were 9.2% lower YTD/YTD. Overall, YTD exports were down 3.6% compared to the prior year; imports: -8.2%.

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U.S. softwood lumber export activity through the Gulf customs region represented 37.6% of the U.S. total; West Coast: 31.3%, and Eastern: 21.6%. Mobile (16.2% of the U.S. total), San Diego (16.1%) Laredo (15.3%), and Seattle (12.1%) were the most active districts. At the same time, the Great Lakes customs region handled 56.4% of softwood lumber imports -- most notably the Duluth, MN district (18.2%) -- coming into the United States. 

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Southern yellow pine comprised 26.9% of all softwood lumber exports; Douglas-fir (13.0%), treated lumber (13.5%), other pine (10.3%) and finger-jointed (9.8%) were also significant.

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.