Canada Surpasses Russia as The Middle Kingdom's No. 1 Source for Lumber

Led by British Columbia, Canada emerged as the largest exporter of lumber in the world to China in 2011, surpassing Russia as the Middle Kingdom's No. 1 source for lumber. "We are king of the hill, " Gerry Van Leeuwen, of the Vancouver consultants International Wood Markets Group, said Tuesday. "We are No. 1 in total lumber imports into China. " The trend has continued in 2012, Van Leeuwen said. According to the latest statistics from China Customs, Canada supplied 1.45 million cubic metres (about 900 million board feet) of soft-wood lumber during the first quarter of 2012, corralling 47 per cent of the market share for softwood lumber in China. Russia is second at 35 per cent. Softwood lumber - lumber made from coniferous species like spruce, pine and fir - is the dominant wood product manufactured by British Columbia sawmills. B. C. Softwood lumber accounts for about 95 per cent of all Canadian softwood shipments to China, making this province China's largest global supplier, surpassing Russia, which exports both hardwood and softwood lumber, for the first time. International Wood Markets tracks Chinese statistics and on Tuesday released a report, China Bulletin, on the latest figures. Canada's emergence as the top supplier has been meteoric. In 2011, Canada shipped 6.8 million cubic metres of lumber to China, up 20-fold from 2006, when Canada shipped only 331, 000 cubic metres of lumber. "A number of issues have driven our success but one of the biggest ones is price, " Van Leeuwen said. "As the North American lumber market collapsed in 2005/06 and lumber prices went south - from US$400 a thousand board feet to US$188 - suddenly our lumber became very attractive. " When the U. S. Housing market eventually improves, Van Leeuwen said he thinks B. C. Sawmillers will not abandon their new markets in China. "We are subject to this softwood lumber export tax. We have been burdened by this for the last four or five years and I think Canadian lumber producers are much more conscious of the dangers of being too dependent on the U. S. Market. So we think they won't move as quickly. " If prices in the U. S. Increase significantly, however, it's unknown how B. C. Producers will react, he said. China's total demand for wood has been growing at a rate of 10 to 15 per cent a year. It has been buying logs from around the Pacific Rim to meet that demand, pushing up log prices globally, which made the depressed price of B. C. Lumber even more attractive, Van Leeuwen said. He added that China now accounts for 26 per cent of Canadian lumber exports, not enough to influence the price significantly. The U. S. Accounts for 63 per cent of Canadian lumber exports. B. C. Is also a major exporter of logs to China but it pales in comparison to Russia and New Zealand. Russia exported three million cubic metres of logs to China in the first quarter of 2012 while B. C. Exported 594, 000 cubic metres during the same period. But housing construction statistics show a dramatic slowdown is under-way in China. Floor space in newly-started residential buildings dropped by 5.2 per cent in the first quarter of 2012. International Wood Markets is holding a Global Softwood Log and Lumber conference Wednesday in Vancouver, part of the weeklong Global Forest Products Leadership Summit now underway in the city. Source: vancouversun