the new normal? hardwood exports in a changed world

The New Normal? Hardwood Exports in a Changed World

Mike SnowAmerican Hardwood Export Council

September 2021

Trade Creates Prosperity

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($U

SD)

US Hardwood Lumber Exports to the World

Production Peaks1999

Source: Global Trade Atlas

AHEC Formed1986

Global Middle Class will be Dominant by 2030

Global GDP Numbers Adjusted Upward

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$4,000

2016 2017 2018 2019 2020 2021

Milli

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Global Exports of All Hardwood Lumber HS Codes, Including Tropical, Jan-May AnnualOTHER

Cote d'Ivoire

Uruguay

Serbia

China

Ecuador

Bosnia andHerz.Ukraine

Brazil

Russia

Canada

Malaysia

Thailand

EU 27 (Brexit)

United States

Global Hardwood Lumber Trade Slowly Recovering: 5 Months 2021

33%MKT Share

33% 29% 30%34% 29%

Source: Trade Data Monitor

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$600

$800

$1,000

$1,200

$1,400

2016 2017 2018 2019 2020 2021

Milli

ons

($U

SD)

US Hardwood Lumber Exports to Main Regions (Jan-June)

Middle East & North AfricaOceania, Korea, JapanLatin AmericaEuropean Union-28Southeast AsiaChina and Hong Kong

Source: Global Trade Atlas, all data for Jan-June

$-

$100

$200

$300

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$500

$600

$700

$800

$900

China Canada Vietnam Mexico UnitedKingdom

Japan Germany Italy Indonesia Korea,South

Spain Malaysia Australia

Milli

ons

($U

SD)

US HDWD LMBR Exports, Value Jan-Jun

2016 2017 2018 2019 2020 2021


0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

2016 2017 2018 2019 2020 2021

US Hardwood Log Exports, m3 (Jan-Jun)

Other Europe

Middle East

South Asia

Caribbean

European Union-27

Southeast Asia

North America

East Asia

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

China Canada Vietnam Italy Japan Korea,South

Cambodia Bahamas,The

Taiwan

US HDWD Log Exports (Jan-Jun), m3

2016 2017 2018 2019 2020 2021


$-

$0.5

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$1.5

$2.0

$2.5

$3.0

$3.5

2018 2019 2020

Billio

ns ($

USD

)

China’s Hardwood Log Imports in $USD

BrazilEquatorial GuineaGermanyCameroonFranceMozambiqueSierra LeoneCongo (ROC)RussiaUnited StatesSolomon IslandsPapua New Guinea

Source: China Customs Statistics

Regional Log Sources Still Largest Trader with China

11%MKT

Share

8%11%

Greater China Lumber Market

OECD Projected GDP Growth Rate

0

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200,000

250,000Ja

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US HDWD Lumber Exports to China (m3)

Source: U.S. Census Bureau Trade Data

Blue – Before Tariffs Yellow – Initial Tariffs Red- Full Tariffs Green – Tariffs Removed

2017

2018

2019

0

50,000

100,000

150,000

200,000

250,000

January February March April May June July August September October November December

US HDWD Lumber Exports to China (m3)


Blue – Before Tariffs Yellow – Initial Tariffs Red- Full Tariffs Green – Tariffs Removed

20202021

$-

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2016 2017 2018 2019 2020 2021

Milli

ons

($U

SD) Red Oak Lumber Exports to China

Down 48% since 2018

Other Red Oak Markets Necessary to Replace Reduced Demand in China


Tariff Exclusion Through April 2022

• On September 16, 2021 the China State Council Tariff Commission (SCTC) announced an extension of tariff exclusions for hardwood products

• Tariffs suspended through April 16, 2022

Source: China Customs Statistics

Thailand Surpassed USA as China’s Largest HDWD Lumber Supplier During Trade War

30%USAMKT

Share

27.8%ThaiMkt 29.2%

22.2%21.3%

28.6% $-

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2018 2019 2020

Billio

ns ($

USD

) China's Imports of Hardwood Lumber ($USD)

Papua New GuineaGermanyRomaniaCameroonCanadaEcuadorIndonesiaRussiaGabonUnited StatesThailand

30.1%USAMKT

Share

27.4%ThaiMkt 29.1%

22.3%21%

28.3%

• Australia, Brunei, Cambodia, China, Indonesia, Japan, Laos, Malaysia, Myanmar,New Zealand, the Philippines, Singapore, South Korea, Thailand, and Vietnam• The 15 member countries account for

about 30% of the world's population (2.2 billion people) and 30% of global GDP ($26.2 trillion) as of 2020, making it the biggest trade bloc in history.

Regional Comprehensive Economic Partnership (RCEP)

China at a Crossroads:

- Return of the “zombie” SOE- Increasing government debt- Declining returns on public

sector stimuli/weak consumer demand

- Overdependence on manufacturing

- Geopolitics over economics- Demographic “timebomb”

Japan’s stagnation closely tied to demographics

After China, Who’s Next?


September, 2021

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Vietnam Mexico UnitedKingdom

Japan Germany Italy Indonesia Korea,South

Spain Malaysia Australia

Milli

ons

($U

SD)

US Hardwood Lumber Exports by Value:Jan-Jun

2016 2017 2018 2019 2020 2021


$-

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$140

Vietnam Indonesia Malaysia Thailand Philippines Singapore Cambodia

Milli

ons

($U

SD)

US Hardwood Lumber to SE Asia: Jan-June

2016 2017 2018 2019 2020 2021


Top wood suppliers for Vietnam

Vietnam Sawn Hardwood Imports from Temperate Regions:2013 to 2019

Mexico/ Latin America


September, 2021

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2016 2017 2018 2019 2020 2021

Milli

ons

($U

SD)

US Hardwood Lumber Exports to Mexico, Central and South America6 Months January-June

BelizeNicaraguaPanamaGuyanaEl SalvadorCosta RicaColombiaUruguayArgentinaBrazilChileGuatemalaHondurasMexico


0

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2016 2017 2018 2019 2020 2021

Volu

me,

m3

US Hardwood Lumber to Mexico, Jan-June

Birch

Tropical

Ash

Beech

Cherry

Walnut

White Oak

Yellow Poplar

Maple

Western Red Alder

Red Oak

Hickory

Other Temperate


Europe

IMF Projected GDP Growth Rate

Pandemic Recovery Stimulus Spending to Drive Construction Industry:

$-

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2016 2017 2018 2019 2020 2021

Milli

ons

US HDWD LMBR to Europe: 6 Month Jan-June

Bulgaria

Czech Republic

Austria

Cyprus

Poland

Malta

Finland

Lithuania

Greece

Netherlands

Denmark

France

Estonia

Belgium-Lux

Ireland

Sweden

Portugal

Spain

Italy

Germany

United Kingdom


$-

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$10,000,000

$12,000,000

$14,000,000

$16,000,000

2016 2017 2018 2019 2020 2021

Red Oak Lumber Exports to Europe, Jan-Jun

Estonia

Netherlands

Poland

Finland

Denmark

Cyprus

France

Lithuania

Belgium

Greece

Portugal

Ireland

Sweden

Spain

Germany

Italy

Red Oak Continues Strong Growth in Europe

$-

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$3,000,000

Italy UnitedKingdom

Germany Spain Sweden Ireland Portugal Greece Belgium Lithuania

Annual Jan-June Red Oak Lumber Exports to EUR Markets

2016 2017 2018 2019 2020 2021

Red Oak Continues Strong Growth in Europe

Source: Global Trade Atlas

Northeast Asia/Oceania

IMF Projected GDP Growth Rate

$-

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

$35,000,000

2016 2017 2018 2019 2020 2021

US Hardwood Lumber to Japan (Jan-Jun)


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Japan EU27+UK China WorldAverage

Vietnam

Average Value per m3 of Lumber in 2020


Japan is a Premium Market

AMERICAN HARDWOOD EXPORT COUNCIL

JAN-JUN 2021 U.S. HARDWOOD LUMBER EXPORTS – AUSTRALIA & NEW ZEALAND

Jan-Jun 2021 saw an 4% decrease in the volume of US hardwood lumber shipped to Australia and a 98% increase in shipments to New Zealand.

US hardwood veneer exports to Oceania increased by 13% in value to USD 777,000, with the very significant increase in direct shipments to New Zealand.

0

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10,000

15,000

20,000

25,000

30,000

35,000

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45,000

2016 2017 2018 2019 2020 Jan-Jun2020

Jan-Jun2021

New Zealand

Australia

Source: USDA Foreign Agricultural Servicem3

01,0002,0003,0004,0005,0006,0007,0008,0009,000

10,00011,00012,00013,00014,00015,00016,00017,00018,00019,00020,00021,00022,00023,000

2016 2017 2018 2019 2020 Jan-Jun2020

Jan-Jun2021

Others

Tulipwood

Cherry

Hickory

Maple

Ash

Walnut

Red oak

White oak


JAN-JUN 2021 U.S. HARDWOOD LUMBER EXPORTS – AUSTRALIA


While white oak exports to Australia fell by 9% during the period, shipments of red oak remained stable year-on-year.

The Middle East, North Africa and

India

OECD Projected GDP Growth Rate


JAN-JUN 2021 U.S. HARDWOOD LUMBER EXPORTS – MIDDLE EAST & NORTH AFRICA

Jan-Jun 2021 saw a 25% increase in the volume of US hardwood lumber shipped to the MENA region.

The biggest rises were seen in Israel, Pakistan, Turkey, Egypt and Morocco.

Shipments to the UAE (normally the biggest market in the region) decreased during the period by 17%.

US hardwood veneer exports to the MENA region increased by 17% in value to USD 11.77 million.

05,000

10,00015,00020,00025,00030,00035,00040,00045,00050,00055,00060,00065,00070,00075,00080,00085,00090,00095,000

2016 2017 2018 2019 2020 Jan-Jun2020

Jan-Jun2021

Others

Algeria

Qatar

Jordan

Lebanon

Morocco

Israel

Egypt

Saudi Arabia

Turkey

Pakistan

UAE


0

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2016 2017 2018 2019 2020 Jan-Jun2020

Jan-Jun2021

Others

Cherry

Maple

Tulipwood

White oak

Walnut

Ash

Red oak


JAN-JUN 2021 U.S. HARDWOOD LUMBER EXPORTS – MIDDLE EAST & NORTH AFRICA


Tulipwood – 37% increase in exports -main importers were Israel and Turkey.

White oak – 11% increase in exports -main importers were Turkey and Israel.

Walnut – 170% increase in exports –main importers were Pakistan, Turkey and Israel.

Ash – 15% increase in exports - main importers were Pakistan, Turkey (for TMT) and the UAE.

Red oak - 17% increase in exports -main importers were Saudi Arabia, Morocco, UAE and Egypt, but in demand in all markets in the region.


INDIA – HARDWOOD LUMBER END-USERS

The main hardwood lumber processing centres (furniture & handicaftmanufacturers) are located in:

• Delhi-National Capital Region• Jaipur & Jodhpur in Rajasthan• Bengaluru (formerly Bangalore)• Chennai (formerly Madras)

Manufacturers are located across the whole country, but other notable centres are:

• Mumbai & Pune• Hyderabad• Kolkata• Ahmedabad (Ghandinagar)• Lucknow• Mysore (near Bengaluru)

World’s 10 Largest Sawn Hardwood Importers 2015 to 2019(Imports From All Sources)

Source: AHEC analysis of Trade

Data Monitor, Forest Trends

• India imported over USD 100 million of hardwood lumber in Jan-Jun 2020

• Less than 1% came from the United States

• Jan-Dec 2020 India market for US hardwoods:• USD 2.5 million of veneers• USD 2.9 million of logs• USD 1.7 million of lumber

Source: Trade Data Monitor$0

$20,000,000

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2018 2019 2020

USA

UAE

Ghana

South Sudan

Gabon

Cote d'Ivoire

Papua New Guinea

United Kingdom

Germany

Tanzania

Ecuador

Brazil

Indonesia

Myanmar

Benin

Malaysia

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INDIA HARDWOOD LUMBER IMPORTS – JAN-JUN 2020

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2016 2017 2018 2019 2020 Jan-Jun2020

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Birch

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Cherry

Maple

Western red alder

Walnut

Other Temperate

Red oak

Tropical

Ash

White oak

Hickory


JAN-JUN 2021 U.S. HARDWOOD LUMBER EXPORTS – INDIA

The volume of U.S. hardwood lumber shipped to India during the first half of this year was higher than the total volume shipped each year from 2016 to 2018.

Shipments of hickory, white oak, ash, walnut and western red alder were all up significantly as compared to the same period in 2020.

There is a definite shift towards importing more hardwood lumber in general and there is clear evidence of growing interest in American hardwood lumber specifically.

Direct exports of U.S. hardwood veneer to India were stable year-on-year at a value of USD 1.67 million



2020 U.S. HARDWOOD EXPORTS – INDIA (LUMBER MONTHLY)

Two thirds of the total volume exported to India in 2020 took place during the second half of the year.

Total exports reached 2,900 m3 in 2020 – a decrease of 28% on the previous year.

Demand for U.S. hardwoods in 2021 is expected to reach at least 2019 levels.

India is forecast to be the fastest growing major economy in 2021.


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the new normal? hardwood exports in a changed world

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