Wood fiber costs have diminished in all regions of the US this year as the decline in fiber demand by the pulp industry has been greater than the reduction of residual chips supply from the sawmilling sector. The past six months, pulpwood costs have fallen about 10% in the US South and 20% in the US Northwest, according to the North American Wood Fiber Review

For Immediate Release

SEATTLE/EWORLDWIRE/April 17, 2009 --- Pulpmills and sawmills took a great deal of market-related downtime in the 4Q/08 and 1Q/09, with no region of North America immune to the deteriorating markets for most forest products, reports Wood Resources International. Market pulp production in North America was 29 percent lower in December 2008 than in the same month in 2007. The operating rate was a record-low 69 percent in December, which can be compared to 87 percent in Europe and 85 percent worldwide.

Lumber production, and residual chip supply, was also much lower this winter than last year. In the fourth quarter of 2008, lumber production was down 23 percent in the U.S. as compared to the same quarter in 2007. Production continued down in 2009, and sawmills in the western U.S. reported 35 percent lower output in January 2009 than in 2008.

With both market pulp producers and integrated pulp and paper companies curtailing production, demand for wood fiber has fallen considerably this winter. The good news for pulp manufacturers is that wood costs, which typically account for about 45 percent of the manufacturing costs, have fallen substantially since last fall.

Wood chip and pulpwood prices were lower in all regions of the U.S. in the first quarter of 2009. The biggest declines occurred in the U.S. Northwest and the U.S. Northeast where prices have fallen 20 percent for softwood and 42 percent for hardwood, respectively, in the past six months.

In Maine, pulplog prices have fallen substantially but despite the recent decline, hardwood fiber costs are still the highest in North America. The high wood costs have caused a majority of the pulpmills in that state to reduce production this winter.

In the U.S. South, wood costs have been surprisingly stable the past few years but, even in this region, prices for wood chips and pulpwood started to slide in the first quarter.

In the South Central states, roundwood costs fell 10 percent to the lowest level in over a year as wood fiber demand was in decline. The major pulp producers were all taking downtime or have planned reduced operating rates later in the spring which will further reduce the demand for wood chips and pulpwood in the second quarter.

Pulpwood and wood chip market updates are included in the 24-page publication North American Wood Fiber Review. The report, established in 1982 and with readers in most of the large forest companies in North America, tracks wood chip and pulpwood prices in 15 key markets of the U.S. and Canada.

Contact Information
Wood Resources International
Hakan Ekstrom
info@wri-ltd.com
'http://www.woodprices.com'

HTML:   http://www.eworldwire.com/pressreleases/19503
PDF:   http://www.eworldwire.com/pdf/19503.pdf
MOBILE:    http://e4mobile.com/view_release.php?id=19503
ONLINE NEWSROOM:   http://www.eworldwire.com/newsroom/313350.htm

CONTACT:
Hakan Ekstrom
Wood Resources International LLC
10654 NE 204th Pl
Bothell, WA 98011
PHONE. 425-402-8809

KEYWORDS: Pulpwood costs, sawlog prices, pulpwood prices, wood chip prices, wood costs, pulplog prices, global pulpwood prices, softwood chip prices, timber prices, hardwood fiber prices, wood market report, wood market reporting, global pulpwood markets, forest

SOURCE: Wood Resources International LLC