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FOEX Indexes Ltd is an independent company providing audited, trade-mark registered pulp, paper, recovered paper and wood based biomass price indices.

Jun 22, 2021

Market Comments

PIX Wood Finland and PIX Sawn Softwood Timber FAS Finland

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PIX Wood Finland and PIX Sawn Softwood Timber FAS Finland – Sawn timber featured among the largest single forest product export articles from Finland in Q1/2021, according to Luke’s statistics. Overall, forest industry product exports increased by 9% year-on-year to 2.8 billion euros. Sawn timber covered 17% of this. The sawn timber export volume increased by one fourth while its value rose by 45% from the previous year. The production of sawn timber in Finland is forecast to increase to 12 million m³ this year. The whole year is expected to continue very favorably for forest products exports.

The roundwood market has been running well in Finland, along with good demand for forest products globally. This is expected to continue throughout the year. Imports of roundwood have also increased but the ban of roundwood exports by Russia in 2022 will impact this in a major way. According to statistics, a majority of the roundwood imports to Finland come from Russia with about half of this made up by logs for sawn timber production and the other half by wood for pulp and paper production.

US housing starts in May did not fulfil everyone’s expectations but remained seasonally solid, Fastmarkets Random Lengths’ weekly report showed. The total starts were 3.7% ahead of April and over 50% ahead of May 2020. Fastmarkets RISI has forecast a total gain of 10% in 2021 and a smaller gain of 0.5% in 2022 in housing starts. Random Lengths’ Framing Lumber Composite Price has decreased, after reaching over 1,500 USD/MBF in May, to a bit above 1,100 USD/MBF last week. This is still more than double the value a year ago. There is some softening showing in CME’s lumber futures, with July settlement prices dropping below the 1,000-USD/MBF mark last week for the first time since mid-April.

The total roundwood trading volume in May showed increases both y-o-y and m-o-m, according to wood trade statistics from the Finnish Forest Industries Federation. Compared to the previous month, the May total trade volume was a strong 93% higher, with pulpwood showing +82% and logs +103%. The changes in volumes of individual grades were between +77% for pine pulpwood and +106% for spruce logs. Comparing volumes year-over-year, the total volume increased by 64%, with logs rising by 104% and pulpwood by 32%. Individual grades moved higher by between 27% in pine pulpwood and 110% in spruce logs. With almost all regional prices per grade going up again, all PIX Wood Finland indices grew stronger. The PIX Softwood Sawlogs Finland index increased by 2.30 euros, or by 3.59%, to 66.40 EUR/m³. The PIX Birch Sawlogs Finland index value rose by 57 cents, or by 1.25%, reaching 46.30 EUR/m³. The PIX Pulpwood Finland benchmark value strengthened by 55 cents, or by 2.89%, with the index closing at 19.56 EUR/m³. The indices reached their all-time highs again.

With the global sawn timber market running well, Finnish sawn softwood export prices held their strong pricing stand in May as well. Most of the sub-indices showed clear increases, many even double-digit ones. Production did not meet the high demand, with May volumes reported to us remaining behind the high ones earlier in spring. Along with the strong market, the PIX Sawn Timber Pine FAS Finland index increased by 20.87 euros, corresponding to 8.29%, with the index settling at 272.61 EUR/m³. The PIX Sawn Timber Spruce FAS Finland benchmark took a clear step up as well, jumping higher by 9.68 euros, or by 3.79%, and landing at 265.14 EUR/m³. The pine price index has advanced more than the spruce one from the start of the year.

The PIX Wood Finland price indices are based on the monthly wood trade data by the Finnish Forest Industries Federation, which Fastmarkets FOEX converts to a volume weighted 3-month moving average for our benchmark values, after removing the extreme highs and lows before the index calculation. The PIX Sawn Softwood Timber FAS Finland indices are currently based on monthly price reporting from Finnish export sawmills. The indices are calculated with fixed weights on six sawn timber quality grades, which are individually weighted by the volumes reported by the sawmills.