Asian plywood

Exporter prices for Asian Plywood by major exporter country are shown in Figure 31 for the period 1990-95 in both current and constant US$ per cubic meter. Indonesia, as the primary exporter of plywood dominates export pricing. Prices in early 1990-mid 1993 averaged about US$ 375/cum with the exception of a sharp drop to about US$ 250/cum in early 1992. After early 1993, prices climbed to just under US$ 500/cum, and thereafter trended downward through late 1994 when price was again near the US$ 375 level (constant) evident in 1991-92. Data is not reported after mid 1994, although prices for exports from Indonesia to Japan are given for two grades based on C&F. This information is derived from Japan sources and expressed also in US$/cum. Price for half inch panels climbed from just over US$ 200/cum in mid 1992 to a peak of about US$ 425/cum in mid 1993, thereafter drifting downward to below US$ 400 for most of 1994 ant to US$ 350375/cum into most of 1995. Prices for thin panels (C&F) were markedly higher, at about US$ 350/cum (constant) through 1992, climbing sharply in 1993 to over US$ 650/cum, and then declining almost as rapidly to US $450/cum by early 1994. Price continued to decline, reaching US$ 400/cum (constant) by the end of 1994. A moderate recovery was underway into 1995, with price reaching about US$ 450 late in the year.

Figure 31. Price of Plywood 1990-1995

Bold lines show prices in constant 1990 US$ per cubic meter (deflated by the G-5 MUV Index used by the World Bank for deriving real commodity prices). Normal lines show nominal price trends. Grades for all species shown are B/BB Moisture Resistant. 9 mm thickness unless otherwise indicated

Plywood from Indonesia

Plywood from Brazil

Plywood from Indonesia to Japan (C&F) - Hal Inch Panel (11.5 mm)

Plywood from Malaysia

Plywood from Indonesia to Japan (C&F) - Thin Panel (3-5 mm)

Source: INTO. 1996. Annual review and assessment of the world tropical timber situation 1995.

The price for plywood (FOB) for Malaysia compares favorably with that for Indonesia for most of the 1990-94 period. Price for early 1994 was at about US$ 400/cum, bur rather more stable than the decline experienced in Indonesia at the time. Both countries experienced peaks of near US$ 500/cum (constant) at mid-1993 thus losing about 20 percent by late 1994.

Exporter, or producer prices differ from market price for timber users, particularly where distance and shipping create a premium on market access. Further, prices in the seller currency is greatly affected by movements in exchange rates. Given the strong role played by Japan in trade flows and markets for the Asia Pacific Region, trends in Japan are frequently reflected in terms of competition between potential sellers. Changes in Japan's market prices are effectively transmitted backward to sellers, based on the derived price expectation net of sales, shipping and other transaction costs. Finally, exchange rate adjustments must be taken into account.

Table 40 provides a short history of wholesale log prices in Japan (normally port of entry or wholesale market) expressed in Japanese Yen/CUM. Annual prices are averages for the twelve months. The column "D-P.M" represents the period change from the prior column entry. As seen for the majority of species, with the exception of 1993 there were relatively modest upward movements in prices for the 1991-95 period. Prices for most log species peaked in 1993, then fell to levels frequently near the 1991-92 levels. One exception was Lauan logs for lumber production, which reached a peak of 62,900 Yen/cum in 1993 but which has subsequently declined by a much smaller margin, stabilizing in the 59-60,000 yen/cum range for most of 1995. As would be expected, the peak of log prices, particularly for non-conifer lumber, experienced in 1993 contributed to the peak exporter prices for Asia Pacific producers as discussed above. Lauan log prices for plywood production have shown a lower wholesale price in Japan than logs for lumber, in many periods being about one-half. Plywood Lauan log prices also increased sharply in 1993, up by 14,100 yen/cum from 1992 to a level of 41,800 yen/cum. This level gave way to strong declines in 1994 and 1995, with January 1996 price at 28,200 yen/cum, only slightly above 1992 levels.

Comparable Japan wholesale price data for manufactured products is shown in Table 41. For sawnwood products, prices are expressed at yen/cum while for plywood price is yen/sheet for the dimensions and grade shown for each column. For the sawnwood products shown, prices peaked again in 1993, with Lauan boards reaching a wholesale price level of 186,800 yen/cum in 1993. This trend continued into 1994 when prices were 191,900 yen/cum. This level prevailed into early 1995, with price declines frequently offset by increases on a month-to-month basis throughout the year. For January 1996, the wholesale price for Lauan boards was at 188,800 yen/cum, only slightly off the peak of 1994.

Japan wholesale prices for Lauan plywood remained much more stable over the 1991-95 period for the three sizes/grades reported. Price for 90 cm x 1.8 m "Type 1" panels for concrete forming reached 1,470 yen/sheet in 1993, consistent with the price trends for most other products and markets. Price declined however in 1994 and 1995, resulting in a January 1996 price very close to that prevailing in 1991. This pattern was also experienced by the other two panel grades reported, but at lower price levels. In both cases, January 1996 price was comparable to 1991 average wholesale prices. Price trends for Lauan plywood and sawnwood products are quite closely linked to the trends noted above for comparable logs.

Table 40. Japan Wholesale Prices for Logs

Wood Prices

Wholesale prices of log

(Unit: yen per CM)

Year Month		Lauan		Douglas fir		Hemlock		Spruce		U.S.S.R. larch		New Zealand pines		Lauan		Hard wood
		60 cm up		30 cm up		30 cm up		30 cm up		20~28 cm		30 cm up		60 cm up		for pulp
		x 4.0 m up		X 6.0 m up		X 6.0 m up		X 6.0 m up		X 3.8 m up		X 4.8 m up		X 6.0 m up
		for lumber	D-P.M	No. 3 Grade	D-P.M	No. 3 Grade	D-P.M	Mix	D-P.M	Mix	D-P.M	Mix	D-P.M	for plywood	D-P.M	Mix	D-P.M
1991		51,900	-1,900	26,100	-600	25,200	-1,300	24,900	-700	18,800	-1,600	17,600	-700	26,600	-1,000	12,300	0
1992		53,300	1,400	28,700	2,600	25,300	100	23,900	-1,000	20,700	1,900	16,800	-800	27,700	1,100	12,300	0
1993		62,900	9,600	32,500	3,800	28,200	2,900	22,700	-1,200	21,500	800	19,800	3,000	41,800	14,100	12,100	-200
1994		61,800	-1,100	31,000	-1,500	27,800	-400	21,800	-900	19,100	-2,400	17,700	-2,100	34,400	-7,400	11,400	-700
1995		59,800	-2,000	30,300	-700	26,700	-1,100	20,200	-1,600	19,200	100	15,700	-2,000	28,500	-5,900	10,900	-500
1995
	1	60,600	300	30,900	100	27,500	-100	22,200	200	19,600	300	16,100	-400	30,100	-800	10,900	-100
	2	61,000	400	31,500	600	27,900	400	22,500	300	19,900	300	15,800	-300	30,200	100	10,900	0
	3	61,500	500	31,800	300	28,000	100	22,800	300	20,500	600	16,100	300	30,100	-100	10,900	0
	4	60,900	-600	31,600	-200	27,700	-300	22,500	-300	20,400	-100	16,400	300	29,300	-800	10,900	0
	5	60,600	-300	30,900	-700	27,100	-600	21,400	-1,100	19,900	-500	15,700	-700	29,000	-300	10,900	0
	6	59,700	-900	30,000	-900	26,300	-800	20,000	-1,400	19,200	-700	15,500	-200	28,200	-800	10,900	0
	7	59,400	-300	29,400	-600	25,800	-500	19,100	-900	18,600	-600	15,400	-100	27,100	-1,100	10,900	0
	8	59,100	-300	29,000	-400	25,500	-300	18,500	-600	18,400	-200	15,200	-200	27,200	100	10,900	0
	9	58,900	-200	29,100	100	25,700	200	18,200	-300	18,200	-200	15,200	0	27,500	300	10,900	0
	10	58,400	-500	29,400	300	25,800	100	18,200	0	18,400	200	15,600	400	27,600	100	10,900	0
	11	58,800	400	29,800	400	26,300	500	18,500	300	18,400	0	15,800	200	27,900	300	10,900	0
	12	58,800	0	30,600	800	26,800	500	18,700	200	18,700	300	16,100	300	28,300	400	10,900	0
1996
	1	59,000	200	31,100	500	27,100	300	18,900	200	18,800	100	16,200	100	28,200	-100	10,900	0

Source: Japan Wood-Products Information and Research Center (JAWIC) 1996

Table 41. Japan Wholesale Prices for Wooden Products

Wood Prices

Wholesale prices of wooden products

(Unit: yen per CM, plywood yen per sheet)

Year Month		Lauan board		Douglas fir, flitch		Hemlock, square		U.S.S.R. scantling		Luan plywood
		3.0~3.4 cm		10.5~12.0 cm		10.5 cm		3.5~4.5 cm		1.2 cm		0.25 cm		0.4 cm
		X 30.0 cm		x 24.0 cm		X 10.5 cm		X 3.5~4.5 cm		x 90.0 cm		X 91.0 cm		X 91.0 cm
		X 4.0 m		x 3.65~4.0 m		X 3.0 m		X 3.8~4.0 m		X 1.80 m		X 1.82 m		X 1.82 m
		No. 1 Grade	D-P.M	No. 1 Grade	D-P.M	No. 1 Grade	D-P.M	No. 1 Grade	D-P.M	Type 1 Concrete	D-P.M	Type 2	D-P.M	Type 2	D-P.M
1991		165,500	-900	51,700	-800	54,300	-1,300	56,200	1,900	1,200	-120	360	-10	550	-30
1992		162,300	-3,200	54,700	3,000	54,100	-200	55,800	-400	1,140	-60	380	20	540	-10
1993		186,800	24,500	62,000	7,300	60,700	6,600	56,300	500	1,470	330	530	150	730	190
1994		191,900	5,100	61,700	-300	59,600	-1,100	54,800	-1,500	1,300	-170	430	-100	640	-90
1995		189,500	-2,400	59,500	-2,200	56,900	-2,700	53,200	-1,600	1,200	-100	360	-70	570	-70
1995
	1	191,700	100	61,600	0	60,500	0	54,400	0	1,190	0	380	0	580	0
	2	191,500	-200	61,800	200	60,800	300	54,800	400	1,280	90	390	10	610	30
	3	191,300	-200	61,900	100	60,800	0	55,300	500	1,310	30	400	10	610	0
	4	189,800	-1,500	61,000	-900	59,300	-1,500	55,200	-100	1,280	-30	380	-20	590	-20
	5	190,700	900	60,600	-400	58,900	-400	54,600	-600	1,190	-90	370	-10	580	-10
	6	189,900	-800	60,100	-500	57,400	-1,500	53,600	-1,000	1,160	-30	350	-20	570	-10
	7	188,600	-1,300	58,600	-1,500	55,700	-1,700	52,800	-800	1,130	-30	340	-10	540	-30
	8	189,000	400	58,200	-400	54,600	-1,100	52,300	-500	1,100	-30	340	0	550	10
	9	185,100	-3,900	57,700	-500	53,800	-800	52,000	-300	1,170	70	350	10	550	0
	10	189,200	4,100	57,600	-100	53,600	-200	51,300	-700	1,200	30	350	0	550	0
	11	188,600	-600	57,500	-100	53,500	-100	51,000	-300	1,200	0	350	0	550	0
	12	188,700	100	57,800	300	53,800	300	51,000	0	1,180	-20	350	0	550	0
1996
	1	188,800	100	58,200	400	54,300	500	51,200	200	1,210	30	350	0	560	10

Source: Japan Wood-Products Information and Research Center (JAWIC). 1996.

Table 40 and Table 41 also imply that there is a relationship between prices for different species and grades. While not uniform, prices represent perceived differences between value in end uses where timber is matched with the desired attributes for specific uses. These differences in price largely persist even when the overall timber market adjusts upwards or down in response to macro economic developments and conditions of supply. In Table 40, all species of logs lost value in 1994-95 although the proportional decline varied relative to the 1993 peaks. This was also the case for sawnwood and plywood in Table 41 with the exception of Lauan logs for lumber as previously noted. Thus market movements are largely pervasive, with incremental movements modifying overall market changes for individual commodities.

Asia Pacific wood producers are also in competition with other major producer regions, particularly for tropical hardwoods. Figure 32 illustrates some of the changing price conditions prevailing in the 1990-93 period for tropical sawnwood. During most of 1990-91, Asian producers received the lowest prices (exporter price, FOB) among the three major tropical timber producer regions. In effect, Asia Pacific was the 'low cost supplier'. During this period, prices for producers in Africa and Latin America declined, although Latin America Prices suddenly surged in late spring 1991, exceeding US$ 800/cum for a brief period before resuming a declining trend to the end of 1992. During much of 1992 prevailing prices were relatively stead with the Asia Pacific price midway between African and Latin America prices at about US$ 600/cum. As previously noted, Asia Pacific prices surged in 1993, making this region the high cost supplier by the end of the year, in part contributing to pressures for price cuts in order to maintain competitiveness in the major tropical sawnwood markets (particularly Japan).

Figure 32. Biweekly Tropical Sawnwood Prices (Exporter) by Producer Region

Source: Perez-Garcia, J. 1996. Assessing the role of Latin American producers in the global forestry and pulp and paper industries. From the proceedings of the Latin American Pulp and Paper Conference, 3-5 June, Miami, FL p.81.

Lumber export prices for selected hardwood species from the three major regions. Export prices for lumber from Southeast Asia have risen steadily, surpassing prices from both Africa and Latin America.