Southern U.S. sawtimber prices expected to recover in 2012-2013
Increasing demand for wood raw materials indicates higher pine stumpage prices for forest owners and investors according to a recent forecast study by Forisk Consulting.
Forisk Consulting forecasts sawtimber prices for the US South strengthening 4.6 percent into 2012 and 5.5 percent into 2013 as lumber production increases with housing starts. Alternately, pine pulpwood – the lower valued raw material used for pulp, OSB and bioenergy – gains 1.4 percent and 2.7 percent into 2012 and 2013 South-wide, with high variance across the 11 states covered.
In 2011, states such as Georgia, Louisiana and Mississippi show sawtimber prices exceeding $30 per ton, and Florida and Louisiana surpassing $11 per ton for pine pulpwood. Prices change annually across and between states in the 10-year forecast as local mills adjust to end-market demands. The benefit to forecast users of this bottom-up approach was evident in 2010.
"In 2010, Forisk's sawtimber forecast was within 4 percent of actual prices, and within 1 percent for key end-use markets such as paper and paperboard," Forisk's Forest Economist Dr. Tim Sydor said. "The key is understanding and updating the local, state-specific relationship – the elasticity – between wood demand and prices."
The “ForiskFORECAST: Pine Sawtimber and Pine Pulpwood” predicts annual pine sawtimber and pulpwood stumpage prices across the US South and by state through 2020, and forecasts the production of lumber and paper and paperboard, as well as the demand for wood from emerging bioenergy markets. For more information, visit www.foriskstore.com and click "Stumpage Price Forecasts."