The coronavirus pandemic has negatively impacted supply chains for numerous industry sectors worldwide over the past few months.
Many commodity products have seen reduced trade during the months of March, April and May, and as a result of reduced demand, closures of manufacturing facilities to protect workers, constraint in the handling capacity of goods at many ports, and widespread financial distress has ensued.
However, one sector that has remained fairly strong during the initial period of the pandemic is the forest-products industry. Demand for toilet paper, face masks, disinfectant wipes, corrugated paper for cardboard boxes, and wood products for home construction are just a few forest products that have been in unusually high demand in many countries during
A closer look at the March 2020 trade data, the first ‘coronavirus-impacted month’, reveals that global trade of lumber, logs, wood chips and pulp increased in March as compared to the previous month.
The following information illustrates a few interesting examples from the Wood Resource Quarterly (WRQ) of positive developments in the forest industry sector:
- Softwood Logs – China increased imports by 14% m-o-m, with most of the added logs originating from New Zealand, Germany and Russia. Log imports to South Korea rose 19%, while Australia and Canada shipped about 70% more logs in March than in the previous month.
- Softwood Lumber – Lumber shipments from New Zealand and Canada were up 32% and 25% m-o-m, respectively. Lumber importation was up in most of the major markets in March, including China (+59% m-o-m), the US (+27%), the United Kingdom (+13%), and Japan (+10%).
- Wood Pulp – Three of the four largest pulp-exporting countries, Brazil, the US and Chile, increased their shipments between 12% and 26% in March (m-o-m). The five top importing countries all purchased more pulp in March than in February, with China and South Korea increasing their volumes the most (40% and 29% respectively).
- Hardwood Chips – China, Portugal, and South Korea imported more chips for their pulp industry in March than in the previous month. Most of the major chip exporting countries, including Australia, Thailand, South Africa, and Brazil shipped more chips in March than in February.
In the coming months, countries around the world will be easing lockdown policies and loosening the rules that are restricting construction, international commerce and consumer shopping. These changes may further benefit many companies in the forest industry sector. However, as to be expected a rough road lies ahead for many sectors globally.