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FOEX Indexes Ltd is an independent company providing audited, trade-mark registered pulp, paper, recovered paper and wood based biomass price indices.

Oct 22, 2019

Market Comments

PIX Wood Finland and PIX Sawn Softwood Timber FAS Finland

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PIX Wood Finland and PIX Sawn Softwood Timber FAS Finland – The wood trade in Finland is expected to get quieter during the end of this year. According to the Pellervo Economic Research institute (PTT), the demand and prices for forest products are deteriorating and logging as well as wood trade volumes declining. Also increased wood imports are expected to impact the Finnish wood markets. PTT forecasts that on the pulp market the worst trough might be behind us, which may keep the pulpwood market running reasonably well. The sawlog market might still undergo rougher times, according to them. Metsälehti Makasiini’s poll of the forestry management associations, says that they expect pulpwood demand to stay level for the time being. On a longer timescale, demand might start heading back upwards. The sawlog market is also forecast to encounter lower volumes. Currently, standing sales of logs have been running relatively well but the roadside sales have seen some demand issues.

The Finnish sawmills are reportedly curtailing their production to adapt to the current global sawn timber trade circumstances. Even though the global demand for sawn timber has not weakened significantly, the Finnish sawmills exporting the goods are suffering from the impact of the Central European wood damages and the strong Euro. Swedish sawmills are also suffering from the same phenomenon but, with the help from the cheap Swedish Crown and also somewhat lower sawlog prices, not as significantly as the Finnish ones.

The roundwood trading volumes kept increasing from the previous month, according to the wood trade statistics from the Finnish Forest Industries Federation. However, compared to the previous year, the volumes stayed on a lower level. On average, the volume in September increased by almost 40% in sawlogs and almost 50% in pulpwood with the total volume pointing up by about 45% from July. Comparing the volume to the number a year ago, the total decrease was over 20%. Year-on-year, pulpwood volumes showed a decrease of 10% but sawlogs a decrease of over 35%. All grades showed declines, the smallest ones, of a few percent, in spruce and birch pulpwood, the biggest ones in sawlogs. The September price data for sawlogs kept the PIX Softwood Sawlogs Finland index pointing down, as it declined by 81 cents, or by 1.39%, to 57.47 EUR/m³. The PIX Birch Sawlogs Finland index value decreased by 31 cents, or by 0.70%, landing at 43.85 EUR/m³. The PIX Pulpwood Finland benchmark value decreased by 30 cents, corresponding to 1.67%, with the index closing at 17.66 EUR/m³.

The sawn softwood timber export prices showed movement to both directions in September. After a long continuous decline, the price quotes for pine showed some positive development. At the same time, the quotes for spruce turned, now pointing downwards. Based on September data, the PIX Sawn Timber Pine FAS Finland index showed the first positive change in a year, heading upwards by 2.97 euros, corresponding to 1.74%, to 174.02 EUR/m³. The PIX Sawn Timber Spruce FAS Finland benchmark, on the other hand, plummeted by 5.40 euros, or by 2.86%, to 183.62 EUR/m³.

The PIX Wood Finland price indices are based on the monthly wood trade data by the Finnish Forest Industries Federation, which we convert to a volume weighted 3-month moving average for our benchmark values, after removing the extreme highs and lows before the index calculation. The PIX Sawn Softwood Timber FAS Finland indices are currently based on monthly price reporting from Finnish export sawmills. The indices are calculated with fixed weights on six sawn timber quality grades, which are individually weighted by the volumes reported by the sawmills.