BOTHELL, WA - Prices for softwood chips trended downward in both the U.S. and Canada during the first six months of 2012, according to the North American Wood Fiber Review, published by Wood Resources Intl.
The biggest declines came in British Columbia and Alberta because of lower market pulp prices. Chip prices in the U.S. South, the Lake States and the Northeast experienced only minor price adjustments during the first half of this year.
High wood fiber inventories, plenty of sawmill chips and pulp logs, and maintenance shutdowns by a number of pulp mills were the main reasons wood chip prices fell by nearly 7% in the second quarter in the Pacific Northwest. Current chip prices are the lowest they have been in over a year, but still well over the 25-year average.
In the South, softwood chip prices have stayed stable for almost two years. This is a testament to the well-functioning market dynamics that can balance the fiber supply and demand in an efficient manner despite recent droughts, wildfires and flooding. Chip prices in the U.S. South are currently the lowest in North America, and are slightly below the historical trend.