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Hardwood chip market--was 2006 a "normal" year?Author(s): Peter J. Ince
Source: Hardwood market report. (2007): pages 99-102.
Publication Series: Miscellaneous Publication
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DescriptionIn the context of other recent years, 2006 turned out to be a relatively "normal" year for the U.S. hardwood chip market in terms of factors that influence supply and demand; such as prevailing weather conditions, energy price trends, and pulp and paper production. Gulf Coast hurricanes and rising energy prices drove hardwood chip and pulpwood markets in 2005, but weather was not a driving factor in 2006, and energy prices were subsiding by the second half of the year. With few local exceptions, rainfall across the South was below normal through the summer and fall (according to region-wide precipitation data from NOAA), yielding fairly normal weather conditions for timber harvesting. The U.S. pulp and paper industry experienced modest growth in 2006, with total paper and paperboard output climbing by about 1 percent since last year as of October, according to the American Forest and Paper Association (AF&PA). The historic downturn in U.S. pulpwood receipts (16 percent decline from the 1994 peak to 2002) appears to have abated in recent years. From 2002 to 2005, U.S. pulpwood receipts (the quantity of wood received at wood pulp mills) climbed by about 3 percent, with varied gains from year to year and an average gain of about 1 percent per year, according to the Forest Resources Association. Pulp and paper commodity prices were relatively robust in 2006, with hardwood market pulp prices continuing to climb upward from their recent historic lows of 2002, according to Pulp & Paper Week. In general, hardwood chip and pulpwood market conditions in 2006 appeared more "normal" than in other recent years, and thus 2006 provided a rare opportunity to observe what happens to hardwood chip and pulpwood markets under relatively "normal" market conditions.
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CitationInce, Peter J. 2007. Hardwood chip market--was 2006 a "normal" year?. Hardwood market report. (2007): pages 99-102.
KeywordsWood chips, economic aspects, marketing, supply, demand, hardwoods, economic aspects, United States, pulpwood, pulping, chips
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