The booming housing economy and furniture manufacturing, and even demand for whiskey are all affecting the surge in hardwood exports to North Asia markets. One in three boards coming off the production line is destined for the People’s Republic of China. Companies nationwide are supplying a variety of hardwood species to customers in China, Korea and Japan.

One third of the U.S. is forested area accounting for 751 million acres, which is second only to Russia’s 766 million acres. In 2017, the U.S. value of industry shipments of wood was $95 billion. Asia markets are depending on a sustainable source of temperate hardwood (ash, cherry, maple, oak, walnut) and the U.S. can increase exports because of careful management of its forests. In fact, the U.S. grows more hardwood each year than it harvests for reliable supplies, according to United Kingdom based International Timber. Moreover, the American Hardwood Export Council (AHEC) confirmed to the AJOT that the U.S. surpassed Russia as the top temperate hardwood exporter to China.

Hardwood Exports

Quality hardwoods are grown in rural areas not near shipping hubs and these rural family-owned companies are now quite adept at exporting over the past ten years. The eastern region is heavily forested with hardwood supply from the Appalachian Mountains from North Carolina up through New England as well as in the deep south of Louisiana, Mississippi and Alabama. “At this point, just about every lumber company in business today is exporting in some capacity,” explained Tripp Pryor, International Program Manager, AHEC, based in Virginia to AJOT. Recent exporters are from the Midwest and “North Central” regions of Iowa, Minnesota, Wisconsin and Michigan. Some exporters are in Oregon and Washington in the Pacific Northwest, but are primarily softwood (logs) companies with hardwood divisions to buy hardwoods from the East Coast region for foreign customers and export smaller volumes of local species like western red alder. “Most of our members utilize inland freight as well as international shipping. I’ve even heard from some of them that shipping to China has become cheaper than inland freight to U.S. ports,” exclaimed Pryor.

AHEC finds the growth of the Chinese market is unlike anything ever encountered in this industry. They estimate that 60% of all hardwood lumber produced is exported and of that 54% ends up in China. They opened offices in Shanghai and Hong Kong in 1992 when U.S. hardwood exports to Hong Kong were $7 million and $1 million to China per year. In 2017, hardwood lumber exports to China alone jumped to over $1.5 billion. The surge was after the financial crisis when in 2009 the U.S. exported $209 million of hardwood lumber to China, then $507 million in 2011 and going over one billion dollars in 2014 exported to China. The compound annual growth rate (CAGR) from 1992-2017 was 34% of total hardwood lumber in dollars exported to China whereas Japan and Korea decreased over that 25-year period by 11.47% and 1.8%, respectively.

Source: AJOT report, Mar 12, 2018