Imported Tropical Hardwoods Year End Update

Imported hardwood lumberIn a year where the hardwood lumber industry as a whole had significant challenges, the imported tropical hardwoods segment turned out to be a more “normal” then we saw for the last 24 months.

Looking back, 2023 started out with very high shipping and trucking rates.  In retrospect, much of this was a lingering effect from the pandemic years.  Thankfully, we have seen a great reduction in shipping costs during the year and today we feel we are operating in a much more stable logistics market.

A noticeable concern we have started to grow this fall. What we expect to impact the market in 2024 is the extremely extended rainy season in Africa.  As we sit here today in December the rainy weather in Africa is persisting. I have first-hand knowledge of how this could impact the industry. When I lived in Africa back in the mid 1990’s the rainy season typically started to slow down in September.  By October it was pretty much dry and logging, sawing and shipping conditions stabilized. So, it is quite unusual to see it be so wet this late in the year. Therefore, we expect that the availability of new supply out of Africa, such as Sapele, will be very limited for the first part of 2024.  We expect there will be some hardwood log and lumber inventories to work with, but from what we have seen, the amount of new supply has been very limited, and some African sawmills have already ceased production for the year as a result.

For inbound lumber shipments already in transit, landed inventories of imported woods from Africa are also starting to run low. Recently, I have been advising customers to expect shortages in certain species and to plan accordingly for at least the first half of the year. Certainly, sawmills will resume operations again in January and production will start to ship in March. So, if historical intervals hold true, we should expect new inventories to be dried and available for sale by late spring or early summer in the United States.

For our species sourced from Brazil we have seen a much steadier supply this year.  Admittedly, there have been some wild price swings from earlier in the year. Currently, the price of Brazilian lumber is currently down approximately 30% from its peak and freight is down by as much as $ 1,000/mbf helping us to be able to offer more competitive pricing then earlier in the year.  Today, we are well stocked in our usual Brazilian species that include Jatoba, Tigerwood, Purpleheart, Lacewood and Bloodwood.

In summary, 2023 was not easy. Next year won’t be without its challenges, but we are optimistic about the opportunities for success for the imported tropical hardwood lumber market in 2024!

Jesper Bach
The Baillie Group
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