U.S. hardwood fiber demand and supply situation : globalization and structural change

Abstract

This paper reviews demand and supply trends for hardwood fiber in the United States. The objective is to illustrate nationwide shifts in demand and supply and show how the hardwood pulpwood market reacts to those shifts at a regional level. Thus, the market situation is illustrated using an economic rationale, and trends are projected under assumptions about future shifts in demand and supply. Results indicate the market is recovering from a major structural shift in demand, a downturn over the past decade driven by economic globalization, and also by increased paper recycling since the 1980s. Another long-run demand-side influence is expansion of hardwood fiber use at oriented strandboard mills. On the supply side, hardwood timber inventories are large but timber growth rates are relatively low (compared with softwoods). Hardwood resource ownership is increasingly diverse, and investment in hardwood resource productivity is fairly limited. Investment in short-rotation hardwood fiber crops could play a larger role in the future, but that potential appears to depend on the U.S. trade outlook and future growth in pulp and paper demand. In the interim, supply-side factors such as weather and precipitation combine with business cycles on the demand side to determine short-run market behavior.

Citation

Ince, Peter J.; Durbak, Irene. 2005. U.S. hardwood fiber demand and supply situation : globalization and structural change. Proceedings of the 2005 TAPPI Engineering, Environmental and Pulping Conference, 2005 August, Philadelphia, PA. Norcross, GA : TAPPI Press, 2005: 35 pages.