The global forest-products industry ended the first half of 2026 with lower international trade volumes, restrained construction demand and widening differences between regional production costs. Lumber prices were comparatively stable in several major markets, but this stability concealed a more difficult commercial environment in which buyers purchased only against confirmed requirements, mills faced elevated raw-material costs and exporters struggled to maintain margins.<\/p>\n
The clearest global trend was not a uniform collapse in prices, but a contraction in traded volumes. Softwood lumber imports by several of the world\u2019s largest consuming markets declined sharply during the opening months of the year, with the United States, China and Germany accounting for much of the reduction. Across the ten largest importing countries, first-quarter softwood lumber imports fell by approximately 3.9 million m\u00b3 year on year to 12.6 million m\u00b3.<\/p>\n
International suppliers responded by reducing production, extending maintenance shutdowns or redirecting volumes towards alternative markets. However, the ability to shift supply remained limited because weakness was visible across several destinations at the same time. China purchased less imported lumber, European construction remained subdued, US housing demand was constrained by financing costs, and buyers in the Middle East and North Africa became more cautious as freight and insurance expenses increased.<\/p>\n
The result was a market in which regional supply conditions mattered more than headline selling prices. Producers with access to relatively inexpensive logs, flexible transport routes or stronger domestic outlets were better positioned than mills dependent on expensive imported fibre or distant export markets. The regional divisions that emerged during the first half are likely to remain the defining feature of the forest industry during the remainder of 2026.<\/p>\n
Europe: Stable lumber prices, weaker trade and high raw-material costs<\/strong><\/p>\n The anticipated spring improvement in European lumber demand did not develop on the scale expected by sawmills. Purchasing remained cautious through May and June, with construction companies, timber merchants and industrial buyers relying on existing inventories and limiting orders to immediate requirements. European lumber prices consequently showed relatively little movement, but the absence of major price reductions did not indicate a balanced or profitable market.<\/p>\n European lumber markets in June are largely stable, with limited price changes, ample availability and restrained buying before the third quarter. Spruce structural lumber delivered into Germany generally traded at approximately EUR 320\u2013340\/m\u00b3, depending on grade, dimensions, origin and contract conditions. This selling-price stability contrasted with continued pressure from sawlog, energy and transport costs.<\/p>\n The problem was particularly pronounced in Northern Europe. Finnish and Swedish producers entered 2026 with some of the highest roundwood costs in their recent history. Although pulpwood prices began to decline during the first half, sawlog prices remained elevated compared with lumber-market conditions.<\/p>\n In Finland, standing-sale prices for spruce sawlogs approached EUR 83\/m\u00b3 in May, while pine sawlogs exceeded EUR 77\/m\u00b3. Trading activity nevertheless weakened sharply: May purchases were approximately 30% below the previous year, while cumulative January\u2013May roundwood trade was 28% lower year on year. The figures suggested that forest owners remained reluctant to sell at lower prices while mills became more selective about procurement.<\/p>\n Swedish roundwood prices also began to correct, with sawlog reductions reaching approximately SEK 150\/m\u00b3 in some purchasing regions and pulpwood prices falling by as much as SEK 90\/m\u00b3. The correction offered only partial relief because southern Sweden continued to experience tight timber availability. Norwegian softwood sawlogs were increasingly transported into Swedish mills, illustrating how shortages persisted locally even as the broader European lumber market remained oversupplied.<\/p>\n Several Nordic producers adjusted output. Vida announced the permanent closure of its Urshult and Orrefors sawmills, while Stora Enso prepared a multi-month shutdown at Veitsiluoto in Finland. Pulp producers also reduced operating rates as high wood costs collided with weaker pulp prices. UPM scheduled a six-week stoppage at its Kaukas pulp mill, Mets\u00e4 Group\u2019s Joutseno mill remained idle, and Stora Enso decided to close a smaller pulp line at Skutsk\u00e4r.<\/p>\n Central Europe faced a different cost structure but similarly weak demand. German and Austrian sawmills were generally able to offer lumber below some Nordic quotations, supported by lower delivered log costs in selected regions. This increased competitive pressure within Europe without creating a meaningful expansion in consumption.<\/p>\n Germany remained one of the most difficult markets. Production of softwood lumber and planed products had already fallen to a ten-year low in 2025, and the German Sawmilling and Wood Industry Association expected a further reduction of approximately 9\u201310% in 2026. Residential construction remained weak, while insolvencies and restructuring procedures spread through timber construction, furniture, packaging and distribution.<\/p>\n European production is therefore expected to decline for a third consecutive year. Members of the European Organisation of the Sawmill Industry produced approximately 79.4 million m\u00b3 of softwood lumber in 2025, down 1.5%, and the organisation forecast another 0.6% decrease in 2026. Consumption was projected to rise by 2.9%, but the improvement had not become clearly visible during the first half.<\/p>\n Export markets provided little support. EU softwood lumber exports to the Middle East and North Africa fell by 19% year on year between January and April to approximately 2.08 million m\u00b3, while their value declined by 13% to EUR 362.7 million. Shipments to the United Kingdom dropped by 23% during the first quarter.<\/p>\n European sales to the United States also weakened substantially. US softwood lumber imports from the EU fell by 35.7% in the first quarter, while imports from Germany were particularly weak. By April, US purchases from the EU-27 were 48% below the previous year and imports from Germany were down by 83%.<\/p>\n Japan offered no meaningful alternative. Japanese softwood lumber imports declined by 9% in January\u2013April to 1.06 million m\u00b3, with lower volumes arriving from Europe, Canada and Russia.<\/p>\n Europe therefore entered the second half with production already being adjusted, but without a decisive reduction in market availability. The pressure was concentrated on margins rather than benchmark prices: mills continued to sell lumber at largely stable levels while absorbing costly sawlogs, energy and freight.<\/p>\n North America: Supply contraction supports prices, but housing demand remains limited<\/strong><\/p>\n The North American lumber market was shaped by the conflict between restricted supply and weak consumption. Mill closures and production curtailments helped prevent a deeper price decline, but high mortgage rates and subdued residential construction limited the potential for a sustained recovery.<\/p>\n US housing starts fell sharply in May to a seasonally adjusted annual rate of 1.177 million units, down 15.4% from April and 8.7% from the previous year. Single-family starts declined more moderately to 882,000 units, while building permits remained almost unchanged year on year.<\/p>\n Existing-home sales also weakened in June as high mortgage costs and record home prices restricted affordability. Although housing inventories were higher than a year earlier, the increase was insufficient to generate stronger turnover or a major improvement in new construction demand.<\/p>\n Against this background, Western spruce-pine-fir 2x4 No. 2 and Better lumber traded mostly between USD 480 and USD 500 per thousand board feet from mid-March onwards. Prices were stronger than the lows recorded previously but remained within a relatively narrow range. US western lumber maintained a premium of more than USD 100 per thousand board feet over Western SPF, while southern yellow pine traded at a discount.<\/p>\n The relative stability was supported by shrinking output. US softwood lumber production declined by 1.9% in the first quarter to 8.83 billion board feet, equivalent to approximately 14.2 million m\u00b3. Southern yellow pine production fell by 3.1%, while output in the US West was almost unchanged.<\/p>\n Canadian production contracted more significantly. During the first four months, national lumber production declined by 10.2% to approximately 6.0 billion board feet. British Columbia output fell by 8.7%, while production across the remainder of Canada decreased by 13%.<\/p>\n The reductions continued a structural adjustment that has removed an estimated 6 billion board feet of North American sawmill capacity over approximately three years. This contraction has created a tighter relationship between available supply and current demand, even though housing activity remains weak.<\/p>\n Imports also declined. US softwood lumber imports fell by 22.1% in the first quarter to 2.91 billion board feet. Canadian shipments dropped by 22.6%, while European deliveries declined by more than one-third. Through May, total US lumber imports were approximately 18% lower year on year.<\/p>\n Trade policy amplified the decline. The combined US countervailing and anti-dumping duties on Canadian lumber had risen to 35.16%, while an additional tariff lifted the total burden to approximately 45.16%. Preliminary calculations for the next administrative review pointed to a possible reduction, but importers and producers continued to operate under considerable uncertainty.<\/p>\n Canada began exploring alternative markets, including the United Kingdom, continental Europe and the Middle East. British Columbia aimed to redirect part of its US-bound output and establish new logistics arrangements for shipments to Europe. However, replacing established US demand remained difficult because European and Middle Eastern markets were themselves purchasing cautiously.<\/p>\n The US hardwood lumber market was more stable. Export volumes during the first five months were only 0.2% below the previous year, while values increased by 1.2%. Shipments to Canada expanded, but exports to China declined by approximately 6%. Beech, walnut, hard maple and yellow poplar recorded stronger international sales, while white oak volumes decreased.<\/p>\n North America therefore ended the first half in a tighter but not stronger market. Supply had adjusted enough to support lumber prices, yet demand remained insufficient to restore normal utilisation rates or justify a broad return of idled capacity.<\/p>\n China: Lower imports as domestic demand and construction remain weak<\/strong><\/p>\n China remained the most important source of weakness in global timber trade. The prolonged property downturn continued to reduce construction-related wood consumption, while subdued furniture and finished-product exports affected demand for imported hardwoods, softwood lumber and industrial fibre.<\/p>\n USDA assessments published during the first half indicated that China\u2019s wood-product imports were expected to continue declining in 2026 because of weaker domestic and international demand. A separate USDA hardwood-market review found that slower economic growth, weaker real-estate activity and reduced exports of finished wood products had already lowered hardwood demand.<\/p>\n Chinese softwood log imports fell by 7.6% year on year during the first four months to 7.95 million m\u00b3. New Zealand remained by far the largest supplier, accounting for approximately 5.54 million m\u00b3, or 70% of total imports. Shipments from Japan, Canada and Latvia increased, but imports from Australia and the United States declined.<\/p>\n The contraction was considerably larger in lumber. Chinese softwood lumber imports fell by 27.2% to approximately 3.70 million m\u00b3 during January\u2013April. Russian shipments, which represented two-thirds of total imports, declined by 30.9% to 2.44 million m\u00b3. Deliveries from Belarus, Sweden and Finland were also lower, while Canadian volumes increased slightly.<\/p>\n The decline was not caused only by the property sector. China\u2019s domestic timber supply has expanded considerably over the past several years, particularly from eucalyptus, Masson pine and Chinese fir plantations. Much of this fibre is used in panels, pulp, veneer and lower-grade construction applications, where it competes directly with imported material.<\/p>\n Domestic wood-pulp production has also increased rapidly. By 2025, Chinese pulp production was approximately four times its 2010 level and broadly equal to imported market-pulp volumes. Additional projects planned under the 2026\u20132030 Five-Year Plan are expected to increase pulp capacity further, reducing the growth available to international suppliers.<\/p>\n June provided some signs of stabilisation. Chinese log inventories at ports remained manageable, and New Zealand exporters reported steady daily offtake. CFR prices for New Zealand A-grade logs were around USD 126 per JAS m\u00b3 in late July, indicating that the market had avoided the deeper seasonal decline seen in previous years.<\/p>\n Nevertheless, China entered the second half as a smaller importer of most major solid-wood products. The country continued to absorb large volumes, but it no longer provided the automatic outlet for excess production that exporters in Russia, Europe and Oceania had relied upon in earlier market cycles.<\/p>\n Japan and wider East Asia: Import demand loses momentum<\/strong><\/p>\n Japan\u2019s lumber market weakened during the first half as construction demand slowed and imported inventories remained sufficient. Softwood lumber imports fell by 9% in January\u2013April, with declines across the principal European and North American supplier groups.<\/p>\n European shipments to Japan reportedly fell by approximately 30% in May. The decline added to the difficulties of Nordic and Central European sawmills already facing lower exports to the United States, the United Kingdom and the MENA region.<\/p>\n Across tropical Asia, conditions were mixed rather than uniformly negative. The International Tropical Timber Organization\u2019s Global Timber Index showed modest expansion in Indonesia and Ghana during June, while activity remained weaker in several other producing and processing countries.<\/p>\n Vietnamese manufacturers continued to redirect more finished wood products towards Europe, supported by some recovery in EU orders. However, furniture and panel producers across Asia remained exposed to weak consumer demand in the United States, Europe and China, as well as changing tariff and trade-remedy measures.<\/p>\n The region\u2019s first-half performance therefore depended heavily on product mix. Exporters of finished furniture and specialised products retained more flexibility than suppliers of commodity lumber, veneer or panels, where competition remained intense and buyers had more alternatives.<\/p>\n Russia: Falling production and reduced access to traditional markets<\/strong><\/p>\n Russia\u2019s forest-products industry continued to contract under the combined effect of sanctions, high financing costs, logistical difficulties and weaker Chinese demand.<\/p>\n Softwood lumber production was forecast to decline by another 2\u20134% in 2026 following a 2.5% reduction in 2025. During the first four months of 2026, production of softwood lumber fell by 7.9% to approximately 10.8 million m\u00b3, while hardwood lumber production dropped by 37.6%.<\/p>\n The downturn extended across plywood, particleboard, OSB, wood pulp and paper. Plywood production decreased by 11.1%, OSB by 10.1%, wood pulp by 6.4% and paper and paperboard by 4.6%. Wood pellet production was one of the few segments to expand.<\/p>\n Chinese demand provided less support than previously. Russian lumber exports remained dominant in China, but volumes declined by almost one-third during January\u2013April. At the same time, access to European markets remained restricted and replacement markets generally required longer transport routes and lower selling prices.<\/p>\n The Russian logging sector also faced deteriorating equipment availability. A high proportion of harvesters and forwarders originated from foreign manufacturers, making spare parts and maintenance increasingly difficult. Higher proposed forest-lease charges and expensive credit added further pressure.<\/p>\n Russia therefore entered the second half with falling production but limited ability to translate the contraction into higher export prices. Supply was declining because producers were losing economic viability, not because end-market demand was expanding.<\/p>\n Oceania: New Zealand log exports stabilise after a weaker start<\/strong><\/p>\n New Zealand\u2019s export-log market experienced another volatile first half, but conditions improved towards the middle of the year.<\/p>\n Export prices weakened during the second quarter as lower Chinese CFR prices coincided with higher ocean freight. In June, A-grade wharf-gate prices for the following month declined by approximately NZD 9\/m\u00b3 after Chinese prices fell by USD 4\/JAS and shipping costs increased by about USD 1.30\/JAS.<\/p>\n Earlier in the year, government analysis indicated that freight costs for New Zealand log exports to China had increased by more than 30% in March, while export volumes to China fell by approximately 20%.<\/p>\n By July, however, the market had begun to stabilise. Chinese port inventories remained controlled, offtake was steady and A-grade CFR prices were around USD 126\u2013127\/JAS m\u00b3. The annual trough was also shallower than in the previous three years, suggesting that supply reductions and lower harvesting activity were beginning to rebalance the market.<\/p>\n Domestic New Zealand log prices remained broadly stable at approximately NZD 129\u2013130 per tonne, while lower diesel prices restored viability to some harvesting operations that had become uneconomic.<\/p>\n Australia\u2019s timber market was less dependent on short-term export-log movements. Sawlog prices were expected to increase nominally while remaining broadly flat after inflation. Timber demand showed modest improvement, supported by a gradual increase in residential approvals, although higher interest rates continued to limit construction activity.<\/p>\n The wider Oceania market therefore showed early signs of stabilisation, but the improvement depended heavily on continued Chinese buying and manageable freight costs.<\/p>\n South America: Brazil faces export pressure while Uruguay expands processing capacity<\/strong><\/p>\n Brazil\u2019s forest-products sector experienced weaker export revenue during the first half despite relatively stable or higher volumes in selected product groups.<\/p>\n Exports across ten major wood-product categories totalled approximately USD 855 million during the first half, around 8% below the previous year. Sales to the United States reportedly fell by about one-third as buyers reduced orders before the introduction of new tariffs.<\/p>\n Pine lumber export volumes increased over the preceding 12 months, but lower average prices reduced revenue. Plywood performed more weakly, with both volume and prices declining. Moulding exports recorded an even sharper contraction.<\/p>\n Brazilian plywood shipments temporarily accelerated before the tariff deadline as US importers advanced purchases. Fastmarkets reported that one major exporter recorded a 118% increase in plywood shipments from January, but the increase represented inventory positioning rather than stronger underlying consumption.<\/p>\n The competitive environment became more difficult in July, when the United States introduced a 25% tariff covering several Brazilian wood products. Lumber, plywood and mouldings were not included among the principal forest-product exemptions, while pulp and wood pallets received different treatment.<\/p>\n Brazil\u2019s pulp market was more resilient in volume terms but faced lower prices, particularly for bleached eucalyptus kraft pulp. The appreciation of the Brazilian real further reduced revenue in local currency.<\/p>\n Uruguay presented a stronger investment picture. Its three large pulp mills operated near full capacity, consuming an estimated 9.27 million m\u00b3 of wood during the first half. Mill-gate pulpwood prices nevertheless declined by approximately 5\u201310%.<\/p>\n Woodchip exports increased by almost 20% to around 235,000 bone-dry tonnes, supported by demand from Portugal and China. Pine log exports to India also expanded, reaching approximately 422,000 JAS m\u00b3, while eucalyptus sawlog exports maintained firm volumes and prices.<\/p>\n Investment continued in solid-wood processing. Cofusa-Urufor prepared to commission a new USD 100 million sawmill in Rivera, while Arboreal secured financing to expand its lumber, biomass and mass-timber platform. BrasPine also advanced plans for its first production facility outside Brazil.<\/p>\n South America therefore displayed a widening contrast: Brazilian commodity exporters faced lower prices and new trade barriers, while Uruguay continued to attract investment aimed at increasing domestic processing and value addition.<\/p>\n Africa and tropical timber markets: Stable prices, selective recovery and limited processing capacity<\/strong><\/p>\n African timber markets were comparatively stable during the first half, although conditions varied considerably between producing countries.<\/p>\n West and Central African log and lumber prices strengthened selectively as Chinese buyers returned to some markets. The improvement supported export prices for several tropical species, but purchasing remained concentrated and sensitive to grade, species and destination.<\/p>\n The International Tropical Timber Organization reported modest growth in Ghana\u2019s timber sector during June, while activity in several other tropical producer countries remained below expansion levels.<\/p>\n Ghana continued to prepare its legality and traceability systems for European market requirements, but timber exports remained near multi-year lows. The contrast indicated that regulatory readiness alone could not compensate for weak international demand and limited industrial competitiveness.<\/p>\n South African woodchip exports were stronger. Shipments through Richards Bay and Durban reached approximately 944,000 tonnes during January\u2013May, up from 775,000 tonnes during the same period of 2025.<\/p>\n New plantation and processing investments were also announced in East Africa. The New Forests Company planned to expand plantation and timber-processing operations in Uganda and Tanzania, while Tanzania promoted additional investment in engineered wood and domestic processing.<\/p>\n However, much of the region continued to export logs or lightly processed material rather than higher-value products. Freight costs, limited port capacity, power availability and financing remained important constraints. Several governments considered tighter restrictions on raw-log exports in an attempt to increase domestic processing, but the immediate effect in some markets was to reduce trade liquidity rather than create new industrial capacity.<\/p>\n A global market defined by lower trade rather than lower prices<\/strong><\/p>\n The first half of 2026 did not produce a single global lumber-price collapse. Instead, it produced a broad reduction in international purchasing and a redistribution of commercial pressure across the supply chain.<\/p>\n European prices remained relatively stable, but high sawlog costs reduced mill profitability. North American prices recovered from previous lows, but only after extensive capacity closures and lower imports. China purchased less imported lumber and increasingly relied on domestic fibre. Russia reduced production without finding stronger markets. New Zealand\u2019s export-log sector stabilised only after harvesting and prices adjusted. Brazil encountered lower revenues and higher trade barriers, while Uruguay continued to invest in processing.<\/p>\n Across regions, buyers retained the advantage. Inventories were kept low, purchases were delayed whenever possible and orders were increasingly linked to confirmed construction or manufacturing requirements. Producers could still maintain quoted prices, but they often did so by reducing utilisation rates, accepting lower margins or postponing investment.<\/p>\n The global forest industry therefore entered the second half of 2026 with less excess inventory than at the beginning of the year, but also with little evidence of a broad demand recovery. The central issue was no longer simply the level of lumber prices. It was whether producers could secure logs, process them and deliver finished products at costs compatible with the prices buyers were prepared to pay.<\/p>\n The global forest-products industry ended the first half of 2026 with lower international trade volumes, restrained construction demand and widening differences between regional production costs. Lumber prices were comparatively stable in several major markets, but this stability concealed a more … Continue reading \n\n
\n \nRegion<\/th>\n Demand<\/th>\n Prices and costs<\/th>\n Trade and production<\/th>\n First-half market signal<\/th>\n<\/tr>\n<\/thead>\n \n Europe<\/td>\n Weak residential construction and cautious purchasing<\/td>\n Lumber prices broadly stable, but Nordic sawlog costs remained high<\/td>\n Lower exports to MENA, the UK, the US and Japan; further output cuts expected<\/td>\n Stable prices, weaker margins<\/td>\n<\/tr>\n \n MENA<\/td>\n Underlying construction demand remained, but buyers reduced commitments<\/td>\n War-risk surcharges and insurance raised delivered lumber costs by an estimated 20\u201325%<\/td>\n EU softwood lumber exports fell by 19% during January\u2013April<\/td>\n Freight disrupted market access<\/td>\n<\/tr>\n \n North America<\/td>\n Housing demand remained restrained by mortgage rates and affordability<\/td>\n Western SPF mostly held around USD 480\u2013500\/mbf<\/td>\n US imports fell by 22.1%; Canadian production declined by 10.2%<\/td>\n Supply cuts supported prices<\/td>\n<\/tr>\n \n China<\/td>\n Property and furniture demand remained weak<\/td>\n Buyers remained price-sensitive and domestic timber gained market share<\/td>\n Softwood lumber imports fell by 27.2%; log imports declined by 7.6%<\/td>\n Import demand contracted sharply<\/td>\n<\/tr>\n \n Japan and wider Asia<\/td>\n Construction and manufacturing demand remained uneven<\/td>\n Commodity products faced stronger price competition than specialised goods<\/td>\n Japanese softwood lumber imports fell by around 9% during January\u2013April<\/td>\n Selective and product-dependent<\/td>\n<\/tr>\n \n Russia<\/td>\n Weaker Chinese demand reduced the value of Asian export channels<\/td>\n High financing, logistics and equipment costs remained important<\/td>\n Softwood lumber production fell by 7.9% during January\u2013April<\/td>\n Structural contraction continued<\/td>\n<\/tr>\n \n Oceania<\/td>\n Chinese log demand stabilised after a weaker second quarter<\/td>\n New Zealand wharf-gate prices were pressured by lower CFR values and higher freight<\/td>\n Export conditions improved towards July as Chinese inventories remained manageable<\/td>\n Early signs of stabilisation<\/td>\n<\/tr>\n \n South America<\/td>\n Demand varied by product and destination<\/td>\n Brazilian plantation costs remained competitive, but export prices weakened<\/td>\n Brazil faced new US tariffs, while Uruguay continued expanding processing capacity<\/td>\n Trade pressure, continued investment<\/td>\n<\/tr>\n \n Africa<\/td>\n Demand improved selectively in tropical timber markets<\/td>\n Prices were comparatively stable, with gains for selected species<\/td>\n South African woodchip exports increased, while processing investment continued in East Africa<\/td>\n Stable but fragmented<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>","protected":false},"excerpt":{"rendered":"