WRQ Sample

Wood Resource
Wood Resource Quarterly - 2Q/2006 Quarterly
The Global Forest Industry This Quarter..................................................................... 3
Major Pulp and Conifer Sawnwood Producing Countries ........................................... 4
A Few Facts About the Global Forest Industry............................................................. 5

Country Profile: Northwest Russia ............................................................................... 6
Biomass Market Update ............................................................................................. 8
Pulp Market Update ..................................................................................................... 9

Global Average Wood Fiber Prices .............................................................................. 10
Global Delivered Pulpwood Prices .............................................................................. 11
World Pulpwood Price Review by Region ................................................................... 12

Relative Fiber Costs for Major Pulp Grades .............................................................. 14
Conifer Sawlog Price Indices ....................................................................................... 16
Sawlog and Pulpwood Markets - USA ......................................................................... 18

US South, Sawlog and Pulpwood Prices ...................................................................... 19
US Northwest, Sawlog and Pulpwood Prices ............................................................... 20
Sawlog and Pulpwood Markets - Canada .................................................................... 21

Canada West, Sawlog and Pulpwood Prices ..................................................................................... 22
Canada East, Sawlog and Pulpwood Prices ...................................................................................... 23
Sawlog and Pulpwood Markets - Europe .................................................................... 24

Finland, Sawlog and Pulpwood Prices ................................................................................................. 25
Norway, Sawlog and Pulpwood Prices ................................................................................................ 26
Sweden, Sawlog and Pulpwood Prices ................................................................................................ 27
France, Pulpwood Prices ........................................................................................................................ 28
Germany, Sawlog and Pulpwood Prices ............................................................................................... 29
Spain, Pulpwood Prices .......................................................................................................................... 30
Austria, Estonia and Latvia, Sawlog Prices ......................................................................................... 31
Czech Republic and Poland, Sawlog Prices ......................................................................................... 32
Sawlog and Pulpwood Markets - Northwest Russia.....................................................33

Sawlog and Pulpwood Markets - Latin America ......................................................... 34
Brazil, Sawlog and Pulpwood Prices .................................................................................................... 35
Chile, Sawlog and Pulpwood Prices ..................................................................................................... 36
Sawlog and Pulpwood Markets - Asia and Oceania .................................................... 37

Australia, Pulpwood Prices ................................................................................................................... 38
New Zealand, Sawlog and Pulpwood Prices ...................................................................................... 39
Indonesia Pulpwood Prices ................................................................................................................... 40
Japan, Domestic and Imported Sawlog Prices .................................................................................... 41
Japan, Conifer Pulpwood Prices and Imports ..................................................................................... 42
Japan, Non-Conifer Pulpwood Prices and Imports ............................................................................ 43
Pacific Rim Wood Fiber Trade ......................................................................................... 44

Pulpwood Fiber Consumption and Principal Species ......................................................... 45
Recent Articles in the WRQ and List of Conference Presentations .................................... 47
Sources, Subscription Information, Disclaimer and Copyright Laws .................................... 48
© 2006 Wood Resources International 1

Wood Resource
Quarterly
Wood Resource Quarterly

Global Wood Fiber Market Update - 1st Quarter 2006
July 26, 2006

Seattle, USA
To our subscribers,
In this issue we are profiling Northwest Russia, a major supplier of logs to Europe and a region that has
attracted interest from foreign investors in the forest industry. We are pleased to announce that starting from
this issue we will be tracking sawlog and pulpwood prices in Russia on a quarterly basis (see page 33).
As global consumption of bio energy is on the rise, wood pellets are increasingly being traded worldwide. In
the “Biomass market update” we are exploring the key players in this market.
Happy reading.
Sincerely,
Håkan Ekström, Editor-in-Chief

(hekstrom@wri-ltd.com)
2 © 2006 Wood Resources International

Wood Resource
Quarterly
The Global Forest Industry this Quarter
The Pulp and Paper Market Domestic production has declined Korea were higher, while imports
Strong demand and pulpmill clo- 4% and imports are down 1.2% to China and Taiwan fell during the
sures resulted in a tight pulp mar- from January through April. first three months of the year.
ket worldwide in the 2Q and prices
for all grades have gone up in all Global Sawtimber Prices Import of softwood chip to Japan
markets. The Global Conifer Sawlog Price was up 12% compared to the pre-
vious quarter but still lower than the
Index based on sawlog prices in
The list prices in June for NBSK 17 regions around the world was 1Q/05. There has been a switch in
were on average $680/ton in Eu- up slightly to US$74.34/m3 in the sourcing of softwood chips this year
rope and $725/ton in the US. 1Q/06. This can be compared to from Australia to North America.
US$73.90/m3 the same quarter in Japan now imports more chips from
Global market pulp production was 2005, and to US$68.80/m3 in the US west coast and Canada than
4.4 % higher the first four months 2004. The biggest price increases from Australia, but it remains to be
of 2006 than in 2005, reaching during the 1Q occurred in British seem if it is a temporary change or
14.3 million tons with biggest gains Columbia, Chile, Sweden and US not.
in Latin America. Northwest.
Japanese hardwood chip consum-
The Lumber Market The Global Average Wood Fiber ers have also made some changes
in their fiber sourcing and have in-
The lumber market in the US has Price creased imports from Chile, China
definitely turned around and lum- The average global conifer and Uruguay at the expense of Aus-
ber prices have fallen most of the pulpwood price was up by 2.8% tralia. However, Eucalyptus chips
year with the biggest drops in May to $88.67/odmt in the 2Q/06 as from Australia is still the number one
and June. As a result of weaker lum- fiber prices increased in most source, accounting for 30% of to-
ber markets in the US, lumber pro- markets due to a weakening US tal imports.
duction fell by 3% in the US and dollar.
by 4.5% in Eastern Canada the first Biomass Market
four months of the year. Only in The average global price for non-
British Columbia were sawmills conifer wood fiber increased Prices for wood pellets in Sweden
running at higher levels this year 3.6% to $88.67/odmt in the 2Q/ increased to just over SEK200/
than in 2005. 06, which is the highest price in 10 MWh or approximately US$130/
years. This continued upward trend ton in the 1Q/06. Prices have fallen
The lumber market in Europe is was mostly a result of higher prices slightly (in US dollar terms) since
gaining strength and the major sup- in Europe, Indonesia, Brazil and last year as the US dollar has
strengthened.
plying countries of Sweden, Rus- Australia.
sia, Austria and Germany have all
Sweden is both the largest con-
increased shipments to the Euro- Wood Chip Trade
sumer and manufacturer of wood
pean market by between 10-20% Trade of wood chips in the Pacific
pellets in the world with a produc-
as compared to last year. Rim was up by 3.2% in the 1Q/06 tion of almost 1.5 million tons in
as compared to the previous quar- 2005 or slightly less than half of the
Softwood lumber demand in Japan ter. Imports to Japan and South
total production in Europe.
has been down so far this year.

Wood Resource
Quarterly
Major Pulp Producing Countries
Top 20 wood-based pulp producing countries in 2004 (million tons):
1. USA 54.3 6. Brazil 9.6 11. Norway 2.5 16. Austria 1.9
2. Canada 26.4 7. Russia 6.9 12. France 2.5 17. Spain 1.9
3. Finland 12.6 8. Indonesia 5.5 13. Germany 2.2 18. India 1.7
4. Sweden 12.1 9. China 4.1 14. S. Africa 2.1 19. NZ 1.4
5. Japan 10.5 10. Chile 2.8 15. Portugal 1.9 20. Australia 1.2
Note. Countries listed in bold are tracked by the Wood Resource Quarterly and together account for an
estimated 83% of global pulp production.
Major Conifer Sawnwood Producing Countries
Top 20 conifer sawnwood producing countries in 2004 (million m3):
1. USA 65.2 6. Japan 13.6 11. China 6.9 16. Czech Rep. 3.6
2. Canada 58.9 7. Finland 13.5 12. Chile 6.8 17. Poland 3.2
3. Russia 18.9 8. Austria 10.9 13. Brazil 6.4 18. Australia 3.0
4. Germany 17.7 9. India 8.0 14. NZ 4.3 19. Turkey 3.0
5. Sweden 16.7 10. France 7.7 15. S. Korea 4.2 20. Latvia 2.8
Note. Countries listed in bold are tracked by the Wood Resource Quarterly and together account for an
estimated 74% of global conifer sawnwood production.

Wood Resource
Quarterly
A Few Facts About the Global Forest Industry:

Global Industrial Roundwood Usage
Global Usage of Industrial Roundwood
Other Industrial Sawnwood

Almost half of harvested industrial roundwood in the
Roundwood
7.7%
46.0%
world is used to produce sawnwood, of which the
majority is conifer species. Approximately 1/3 of the
global roundwood removals are consumed by the pulp
industry mainly in the US, Sweden, Finland, Brazil
Composite Board
and Indonesia. Pulpwood removals have increased
Pulp
6.3% Plywood
8.8%
31.2% faster than that of sawlogs the past ten years resulting
in a higher share of pulpwood harvests today than in
Source: Wood Resources International LLC
the mid-1990’s.
Wood Fiber Consumption by the Global Pulp Industry Fiber Consumption by the Global Pulp Industry
The global wood-based pulp industry relies on round-
Non-conifer
chips
8.5%
Conifer
roundwood
wood for up to 65% of its wood fiber needs. The
Conifer chips
27.0%
35.1%
logs are either from fast-growing plantations such as
in Latin America and Oceania or from thinnings and
tree tops in the slower-growing regions of North
America and the Nordic countries. Residual chips are
Non-conifer most commonly consumed in the US, Canada, Swe-
roundwood
29.4% den and Finland as these countries have large saw-
milling sectors.
Production Costs for Wood-Based Kraft Pulp Production Costs for Wood-Based Kraft Pulp
Other
16.0%
Wood Wood fiber costs account for between 38-52% of
42.0%
Labor the total variable production costs when producing
15.0%
chemical wood-based pulp. Pulpwood costs have
traditionally been higher in North America and Eu-
rope than in regions with faster-growing plantations
such as in Brazil, Chile and Indonesia. The spread in
Chemicals
11.0% Energy wood costs between the Northern and Southern
16.0%
Hemisphere has declined the past few years.
Production Costs for Conifer Sawnwood Production Costs for Conifer Sawnwood
Other
11.0%
Wood cost is, by far, the largest cost component in
Labor the production of conifer sawnwood. Wood costs
15.0%
range from 60% to 75% of the total variable cost
depending on the region of the world. Sawmills in
North America and Europe typically do have higher
Energy
4.0% wood costs both in real terms and as a percentage of
Wood
70.0% the total production cost, as compared to countries
Source: Wood Resources International LLC with short-rotation plantations, such as Brazil, Chile
and New Zealand.

Wood Resource
Quarterly
Forest Resource and Industry Profile - Northwest Russia

Harvest Doubled in 10 Years Pulp Industry Profile - NW Russia
Russia has, for many years, been considered the ma-
jor untapped wood basket of the world and experts No. of Pulpmills: 11
have long predicted the rapid expansion of harvests
Pulp production in 2005 (million tons) 3.9
and forest industry production in the country. Unfor-
Chemical 2.8
tunately, more than once, positive scenarios have been
downgraded and the growth of the industry has been Mechanical/semi-chem 1.1
disappointing. The region that has attracted the big-
Pulp exports (million tons) 0.7
gest interest from foreign investors has been North-
west Russia, including the forest-rich provinces of Market pulp (%): 29
Karelia, Komi, Arkangelsk and Volodga.
Wood fiber consumption
The total official harvest of timber for industrial pur- Total (million odmt) 7.6
poses in Russia was 140 million m3 in 2005. Approxi-
mately 1/3 of the harvest was in Northwest Russia, a Conifer, roundwood (%) 53
share that was been fairly constant since the 1990’s. Conifer, chips (%) 5
In just ten years, harvests have almost doubled in Rus- Non-conifer, roundwood (%) 42
sia, driven mainly by the timber exports to China and Non-conifer, chips (%) min
Europe. In addition to official harvests there are also
“suspicious” volumes logged, predominantly in Sibe-
ria and the Russia Far East, which account for another the pulp companies in Sweden and Finland. In 2005,
15-20% of timber. those two countries alone imported 86% of Russia’s
total shipments to Europe. Other importers were saw-
Harvests in Russia 1994 - 2005
160 mills in Estonia and Latvia, which are increasingly de-
140 pendent on Russia for sawlogs. The log exports to
120 Europe are fairly evenly split between conifer and non-
conifer species.
million cubic meters
100
80
25
Log Exports from Northwest Russia to Europe
60
40
Conifer
20 Non-conifer
20 Total
0
15
million m3
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Source: ECE/FAO Conifer Non-conifer Total

10
Log Exports Increased 20% from 2005

5
The major species in Northwest Russia are pine,
spruce, larch, birch and aspen with conifer species 0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006e
accounting for approximately 75% of the total har-
vest. Despite increased prices of both sawlogs and
pulplogs in Northwest Russia, roundwood exports to Limited Expansion of the Pulp Industry
Europe reached a record level of over 20 million m3
in 2005, or 20% higher than in the previous year. The Pulp production in the region has not changed much
major consumers of pine, spruce and birch logs are the past four years and there has been no new capac-
ity added in recent years. In 2005, pulp production

Wood Resource
Quarterly
Forest Resource and Industry Profile - Northwest Russia

was an estimated 3.9 million tons, with integrated news- further, there is a lack of Russian capital with the con-
print and paperboard mills consuming more than 71% sequence that any major expansion needs to be backed
of the pulp and the remaining 29% being market pulp. by foreign investors. However, this will only be pos-
sible if those investors find the business climate in Russia
Wood Pulp Production in Russia 1993 - 2005
7
favourable compared to e.g. Latin America and Asia.
6 The furniture company IKEA and the forest company
5
Russia StoraEnso are two foreign companies that recently
Northwest
have made the strategic decision to expand in western
million tons
4
Russia.
3
35 Lumber Production in Northwest Russia

2
30
1
25
million m3
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 20
15
There are currently no announced plans for either Rus-
sian or foreign companies to invest in pulp capacity in 10
NW Russia. Ilim pulp is, by far, the largest manufac- 5
turer of pulp in Russia and it is also the largest ex- 0
porter of market pulp. In 2004, the company’s ex- 1994 1995 1996 1997 1998 1999
Northwest Russia
2000 2001 2002
Total, Russia
2003 2004 2005
ports accounted for 2/3 of Russia’s total pulp exports.
Sawlog Prices Have Doubled in Five Years

Market Pulp Exports from Russia in 2004
Raw-material prices for sawmills and pulpmills in NW
Others
8.2%
Ust-Ilimsk Pulp Russia have continually gone up the past five years as
(Ilim pulp)
Baikalsk Pulp
5.7%
29.8% competition from the export market has put pressure
on domestic log prices. Conifer sawlog prices reached
an average of US$43/m3 in the 2Q/06, ranging from
$34-$50/m3 depending of log grade and distance to
Arkhangelsk P&P
the Finnish border.
6.7%
Bratski P&B (Ilim
Solombalski P&P
Kotlas P&P (Ilim
pulp)
pulp)
26.0%
Over the past five years, sawlog costs have almost
12.5%
11.1% doubled and it is expected that the upward trend will
continue, as there are no indications that the log ex-
port market will weaken. It is still more beneficial for
Slow Growth of the Lumber Sector
Finnish and Swedish sawmills to purchase logs in Russia
Lumber production in the western provinces accounts rather than bidding up prices for marginal volumes in
for less than 30% of the total production in Russia. their domestic market. Pulpwood prices have increased
The total manufacturing in 2005 reached a ten-year even faster than sawlog prices the past few years. Both
high of 6.5 million m3, of which a large share was conifer and non-conifer prices have almost tripled since
exported to markets in Europe. The industry has been 2001 and were in the 2Q/06, US$70/odmt for soft-
growing the past few years both in real terms and as a wood pulpwood and $55/odmt for mixed hardwood.
share of the total production in Russia. Although there Sorted birch pulpwood prices are typically higher and
are opportunities to expand the sawmilling capacity aspen pulpwood lower than for mixed hardwood.

Wood Resource
Quarterly
Biomass Market Update

Global Trade of Wood Pellets in Expansion Mode can be expected to continue with Canada, Russia and
Wood pellets will be one of the major new energy Latin America investing in pellet manufacturing for both
sources when European countries are trying to com- domestic use but also to supply higher demand in Eu-
ply with the Kyoto Protocol and to reduce green house rope, the US, China and Japan.
gases by 2010. Wood pellets are gaining in market Global Exports of Wood Pellets*
7000
share of the “green energy” alternatives as they are
6000
manufactured from a renewable resource, as well as
5000
being clean-burning, cost-stable and reasonably cost
1000 tons
efficient to transport by truck, rail and ship. 4000
3000
Global trade of pellets has also gone up significantly 2000
the past three years with many countries without sub- 1000
stantial forest resources being the major destinations. 0
The largest import countries of wood pellets* in the 1999 2000 2001 2002 2003 2004 2005
world are Italy, Belgium, Denmark, Sweden and Ger- Source: GTA Canada Austria France Total, World 20
many. Most of the world’s pellet consumption is con-

centrated to Western Europe and North America but
during the past year there has been an increased inter- Sweden is the Major Consumer of Wood Pellets
est in Asia for wood energy and a number of delega- Sweden is both the largest consumer and manufac-
tions from China and Japan have been touring North turer of wood pellets in the world with a production of
America and the Nordic countries to explore possi- almost 1.5 million tons in 2005 or slightly less than half
bilities for joint-ventures, investment opportunities or of the total production in Europe. Prices for wood
for signing up long-term supply agreements. pellets in this market have slowly been increasing the
past two years and were just over SEK200/MWh or
9000
Global Imports of Wood Pellets* approximately US$130/ton in the 1Q/06.
8000
7000 250
Wood Pellet Prices in Sweden 1998 - 2006
6000
1000 tons
5000 200
4000
3000 150
SEK/MWh
2000
1000 100
0
1999 2000 2001 2002 2003 2004 2005
50
Source: GTA Italy Belgium Denmark Total, World 20
0
3Q
3Q
3Q
3Q
3Q
3Q
3Q
3Q
8
05
06
/9
/9
/0
/0
/0
/0
/0
1Q
1Q
1Q
1Q
1Q
1Q
1Q
1Q
1Q
Canada has Become the Major Pellet Exporter

in the World Source: Energimyndigheten
The major exporting countries of wood pellets are
* Trade statistics are for the Harmonized System Code
Canada, Austria and France. Particularly Canada, both
HS440130; “Sawdust, wood waste, including briquets and
western and eastern provinces, has in just a few years pellets”. Since global trade of sawdust and wood waste is
become the largest supplier of pellets to both the US minimal it is reasonable to assume that at least 70-80% of
and Europe. The expansion of global trade of pellets trade under this HS code would be wood pellets.

Wood Resource
Quarterly
Pulp Market Update

Strong Demand for Pulp in Asia Pushed Global
Prices Sharply Upward 800 Benchmark Prices for Market Pulp in Europe
750
Strong demand, pulpmill closures and maintenance 700
As of July 18, 2006:
NBSK: $697/ton
BHKP: $649/ton
shutdowns all added up to a tight pulp market world- 650
wide in the 2Q. Prices for all grades have gone up in 600
US dollars/ton
all markets, although the upward price pressure was 550
500
especially strong in Asia. Korean, Chinese and Japa- 450
Source: FOEX
nese pulp buyers accepted recent price hikes much 400
quicker than they traditionally would do. This year has 350
definitely been the sellers market and prices have, de- 300
6
3
03
04
05
M 6
03
04
05
06
6
-0
-0
-0
-0
-0
-0
-0
-0
-0
-0
-0
l-0
l-0
l-0
l-0
p-
p-
p-
n-
n-
n-
n-
ay
ay
ay
ay
ov
ov
ov
ar
ar
ar
ar
Ju
Ju
Ju
Ju
pending on grade and region, gone up between 15%
Se
Se
Se
Ja
Ja
Ja
Ja
M
M
M
M
N
N
Bleached softwood (NBSK) Bleached hardwood (BHKP)
and 30% the past 12 months. The list prices for NBSK
in June were up to $680/ton in Europe, $615/ton in
China and $725/ton in the US, according to Pulp-
Pulp Shipments to Chian Up 20% This Year
watch.
As with many other commodities, China is currently a
NBSK prices delivered to Europe and the US (US$/ton): driving force in pulp consumption. Shipments to China
were up almost 20% during the five first months of the
4Q/05 1Q/06 2Q/06 Latest
Europe 590-600 590-640 640-690 680 year as compared to 2005. This is in contrast to the
US 630-640 630-660 680-730 725 North American market where demand this year has
been 1.4% lower than last year.
The prices for hardwood pulp, including birch pulp,
mixed hardwood pulp and Eucalyptus pulp, have also For the first four months this year global market pulp
gone up, but at a lower pace. The list price for birch production has been 4.4 % higher than in 2005. The
pulp and Eucalyptus pulp delivered to Europe was in biggest increase has been in Latin America, where pro-
June $640/ton, while mixed hardwood (US South) duction was up almost 14% to 3.1 million tons by April.
shipped to the US market averaged $645/ton. Production in Europe and North America were prac-
tically unchanged from last year.
BHKP prices delivered to Europe and the US (US$/ton):
Production of market pulp from January through April,
4Q/05 1Q/06 2Q/06 Latest (million tons):
Europe 560-590 560-620 590-630 640
US, S 600-620 600-630 620-650 645 2005 2006 Change (%)
North America 5.34 5.37 +0.7
W. Europe 3.31 3.30 -0.5
NBSK Pulp Price Reached Five Year High Latin America 2.71 3.08 +13.8
Rest of the World 2.36 2.57 +8.9
The PIX Index price for NBSK in Europe reached Total, world 13.72 14.32 +4.4
$693/ton in the end of July, which was the highest level
since 2001. With tighter worldwide supply of NBSK, ________________________________________
prices have increased faster for softwood pulp than
for hardwood pulp. In July, the PIX Index for BHKP Note.
Prices and production data are from the market
in Europe was $657/ton or $30/ton discount com-
newsletter Pulpwatch. Courtesy of Hawkins Wright
pared to softwood pulp. in the UK (www.pulpwatch.com).

Wood Resource
Quarterly
Wood Resource Quarterly

Global Average Wood Fiber Price (US$/odmt)
The Global Average Wood Fiber Price is a weighted average of delivered wood fiber prices for the pulp
industry in all regions tracked by the publication Wood Resource Quarterly. These regions together account
for 85-90% of the world’s wood-based pulp production capacity. It is based on current quarter average
prices, and country/regional consumption data. The global average for conifer and non-conifer is
calculated in nominal US$ per oven dried metric ton of wood fiber.
The average global conifer pulpwood price was up by 2.8% to $88.67/odmt in the 2Q/06 as fiber prices
increased in most markets due to a weakening US dollar. The average global price for non-conifer wood
fiber increased 3.6% to $88.67/odmt in the 2Q/06, which is the highest price in 10 years. This continued
upward trend was mostly a result of higher prices in Europe, Indonesia, Brazil and Australia.
Average Conifer Price

120 Global Average Conifer Wood Fiber Price
1q/2004 82.95
100 2q 81.59
3q 82.60
80 4q 87.38
US$/odmt
60
1q/2005 89.51
2q 88.69
40
3q 87.00
4q 87.46
20
0
1q/2006 87.17
2q 89.63
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Average Non-Conifer Price

100
Global Average Non-Conifer Wood Fiber Price
95
1q/2004 77.87
2q 73.90
90
3q 76.40
85 4q 80.20
US$/odmt
80
1q/2005 81.74
75
2q 82.07
70
3q 84.32
65 4q 85.03
60
1q/2006 85.63
55
2q 88.67
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Global Delivered Pulpwood Prices
Average Delivered Conifer Wood Fiber Prices

200
3Q/2007
180
160 Chips Roundwood
140
US$/odmt
120
100
80
60
40
20
0
Fi y
en
n
U and
ia t
)
da y
Sw t
lia
G ce
d
t
da il
Ze e
or th
W
es
as
es
om
an
ai
ew hil
Ja n l a n
z
S, Sou
ed
an
rw
,N
tra
ra
,W
,E
w
Sp
m
al
C
(d
B
Fr
th
o
us
er
N
S,
n
ss
A
na
pa
na
N
Ru
Ca
Ca
N
Average Delivered Non-Conifer Wood Fiber Prices

200 3Q/2007
180
160 Chips Roundwood
140
120
US$/odmt
100
80
60
40
20
0
y
en
n
sia
lia
ce
d
t
il
ile
W
as
es
an
ai
an
ut
az
ed
an
,N
tra
Ch
ne
,E
Sp
So
m
nl
Br
Sw
Fr
th
do
us
er
ia
da
Fi
S,
or
G
ss
A
In
na
U
Ru
Ca
S,
U

Wood Resource
Quarterly
World Pulpwood Price Review

Delivered Prices
Second Quarter 2006

Region Product Domestic Price Price in US dollars
Per m3 Per odmt Per m3 Per odmt
Avg Range Avg Range Avg Range Avg Range
US South Rwd, conifer 41 29-45 80 60-88 41 29-45 80 60-88

Rwd, non-con 41 31-39 82 62-88 41 31-39 82 62-88
Chips, conifer 35 28-39 68 57-77 35 28-39 68 57-77
Chips, non-con 32 27-41 63 54-67 32 27-41 63 54-67
US Northwest Rwd, conifer (a) 30 20-39 69 47-89 30 20-39 69 47-89

Rwd, non-con 27 18-29 72 49-79 27 18-29 72 49-79
Chips, conifer 34 26-41 79 60-95 34 26-41 79 60-95
Chips, non-con 36 27-42 97 73-114 36 27-42 97 73-114
Canada, East Rwd, conifer 67 52-80 168 131-199 60 47-71 149 116-177
Rwd, non-con 47 39-56 94 78-113 42 35-50 84 69-100
Chips, conifer 63 51-68 158 128-170 56 46-60 140 114-151
Chips, non-con 42 37-49 83 75-99 37 33-44 74 66-88
Canada, West Rwd, conifer (a) 31 23-36 78 57-90 27 20-32 69 51-80

Rwd, non-con (b) (b) (b) (b) (b) (b) (b) (b)
Chips, conifer 28 25-34 71 60-87 25 23-30 63 57-77
Chips, non-con 0 (b) (b) (b) (b) (b) (b) (b)
0
Norway Rwd, conifer 338 305-354 874 790-917 54 48-57 140 126-148
Chips, conifer 273 223-345 707 577-894 44 40-56 113 103-144
Chips, non-con (b) (b) (b) (b) (b) (b) (b) (b)
Sweden Rwd, conifer 349 280-396 904 725-1026 47 37-55 122 96-142
Rwd, non-con 362 356-380 709 698-745 49 47-52 96 91-103
Chips, conifer 282 221-380 732 572-984 38 30-32 99 77-136
Finland (h) Rwd, conifer 41 36-46 105 94-119 51 48-55 132 124-142
Rwd, non-con 39 35-43 77 69-84 49 45-52 96 88-102
Chips, conifer (c) (c) (c) (c) (c) (c) (c) (c)
France (h) Rwd, conifer 47 34-58 113 86-131 59 43-72 142 108-165
Rwd, non-con 41 37-46 78 70-85 52 47-57 98 88-107
Chips, conifer 44 36-49 107 88-120 55 45-62 134 110-150
Germany (h) Rwd, conifer 43 35-53 115 94-142 54 44-67 145 118-178
Rwd, non-con 56 54-62 121 117-134 70 68-78 152 147-168
Chips, conifer 38 35-43 94 86-106 48 44-54 118 108-133

Wood Resource
Quarterly
World Pulpwood Price Review

Delivered Prices
Second Quarter 2006

Region Product Domestic Price Price in US dollars
Per m3 Per odmt Per m3 Per odmt
Avg Range Avg Range Avg Range Avg Range
Spain (h) Rwd, conifer 20 16-25 47 37-56 25 20-31 58 47-71

Rwd, non-con 41 37-46 69 62-76 52 47-57 87 78-95
Chips, conifer 28 22-35 63 51-81 35 28-44 80 64-102
Brazil Rwd, conifer 86 75-106 171 150-213 39 34-49 78 69-97

Rwd, non-con 91 78-97 182 155-193 42 35-44 83 71-88
Chips, conifer 101 93-113 202 185-225 46 42-51 92 85-103
Chile Rwd, conifer 14065 11240-18510 35162 28090-46270 26 21-34 65 52-85

Rwd, non-con 20858 18710-23810 34763 31180-39680 38 34-44 64 57-73
Chips, conifer (c) (c) (c) (c) (c) (c) (c) (c)
New Zealand Rwd, conifer 41 24-65 103 59-163 26 15-41 64 37-101

Chips, conifer 50 36-63 124 60-156 31 22-39 77 56-97
Australia Rwd, conifer 35 23-59 84 55-139 26 17-44 62 41-104

Rwd, non-con 58 33-83 106 61-151 43 25-62 79 45-113
Chips, conifer 39 26-59 91 60-137 29 19-44 68 45-102
Chips, non-con 78 47-126 141 85-229 58 35-94 105 63-171
Japan Chips (dom), con 5200 3900-6300 12064 9050-14620 45 33-55 105 79-128
Chips (dom), non-c 8500 6100-9300 15300 10980-16740 74 53-81 134 96-146
Chips (imp), con 7293 6090-7590 16919 14130-17600 64 53-66 148 123-154
Chips (imp), non-c 10297 8370-11910 18534 15060-21440 90 73-104 162 132-187
Indonesia Rwd, conifer (b) (b) (b) (b) (b) (b) (b) (b)
Rwd, non-con (g) 220 160-300 440 320-600 24 18-33 48 35-66
Chips, conifer (b) (b) (b) (b) (b) (b) (b) (b)
Notes.
Prices in above table represent wood fiber traded in the open market and do not include internal transfer pricing.
(a) Primarily utility grade roundwood. (e) FOB domestic chip plant or sawmill.
(b) Insufficient volume to obtain open market prices. (f) CIF port in Japan.
(c) Transfer priced on local market (g) Domestic prices in 1000 Rupiah
(d) FOB export price - Hardwood: Eucalyptus Globulus (h) Domestic prices in EURO

Wood Resource
Quarterly
Relative Fiber Costs for Major Pulp Grades

The average Northern bleached softwood kraft pulp (NBSK) price for the 2Q/06 was up to US$654/ton and
wood costs adjusted slightly upward for NBSK pulp manufacturers in all regions, including the Nordic countries,
Canada and US Northwest. This resulted in lower wood fiber cost (in US dollars) as a percentage of the
market pulp prices for NBSK pulp, compared to the previous quarter, down from 34.9 % in the 1Q/06 to
33.8% in the 2Q/06.
The wood cost percentage for the Southern bleached softwood kraft pulp (SBSK) was also slightly lower
compared to the previous quarter and to last year, declining from 26.7% in the 2Q/05 to 26.2% in the 2Q/06.
The small adjustment was a result of both higher wood costs and pulp prices this quarter compared to a year
ago.
The relative wood cost for Eucalyptus pulp was down again this quarter, from 28.0% in the previous quarter
to 27.5%, as pulp prices increased more than wood fiber costs.
Notes. Wood fiber costs remain the single largest cost component in the manufacture of wood pulp. The following graphs
depict the relationship between market pulp prices (in US$ cif Europe), and average wood fiber costs. For each grade, an
average wood fiber cost was calculated using an average kraft pulp yield factor, current quarterly wood fiber prices, and
the average volume of wood consumed by each WRQ region manufacturing that particular grade of pulp (e.g. SBSK is
produced by Spain, the U.S. South, Brazil, Chile, New Zealand, and Australia). The resultant average wood fiber price is
charted as a percentage of the average market pulp price as reported by FOEX Indexes and the publication Pulpwatch
(Hawkins Wright).
1200
Relative Wood Fiber Cost for NBSK Pulp 60
1000 50
US$/Tonne of Pulp
800 40 Percentage
600 30
400 20
200 10
0 0
90
91
92
93
94
95
96
97
98
99
00
01
02
03
4
5
6
7
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Weighted Fiber Cost NBSK cif Europe Fiber Cost % (Right Axis)

Wood Resource
Quarterly
1000
Relative Wood Fiber Cost for SBSK Pulp 60
900
50
800
700
US$/Tonne of Pulp
40
600
Percentage
500 30
400
20
300
200
10
100
0 0
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Weighted Fiber Cost SBSK cif Europe Fiber Cost % (Right Axis)
Relative Wood Fiber Cost for EucBK Pulp

1000 60
900
50
800
700
US$/Tonne of Pulp
40
600 Percentage
500 30
400
20
300
200
10
100
0 0
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Weighted Fiber Cost EucBK cif Europe Fiber Cost % (Right Axis)

Wood Resource
Quarterly
Conifer Sawlog Price Index 1995-2006

(1q/1995=100, Based on US dollars)
It is important to note that sawlog prices presented in the graphs and tables in this publication should be used as
indicators when comparing price trends in different regions rather then for absolute price comparisons. Sawlog
qualities and properties of conifer species vary in different parts of the world and therefore they are not always
directly comparable. Also bear in mind that log grades and volume/weight measurements do differ between
regions. Factors used to convert to cubic meter under bark are estimates made by WRI and regional contacts.
North America
Conifer Sawlog Price Index 1995 - 3Q/2007
180 North America (1q/1995=100)
1q/1995=100 (Based on price in US$)
160
140
US S US W BC C BC I Que
120
1997 104 97 69 105 105
100
1998 109 90 47 89 100
80
60
1999 103 94 47 83 106
40
2000 106 85 49 88 108
20 2001 98 71 40 79 106
0 2002 99 71 50 73 106
2003 100 66 42 75 125
5
7
/9
/9
/9
/9
/9
/0
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
US South - Pine US NW - Hemlock BC Coast - Hemlock 2004 103 77 45 81 141

BC Interior - SPF Quebec
2005 107 88 42 89 152
Conifer Sawlog Price Index 1995 - 3Q/2007

Europe
200 Europe (1q/1995=100)
180
1q/1995 = 100 (Based on price in US$)
160
Finl Swe Aust Ger
140
120
1997 95 92 85 85
100 1998 95 92 86 90
80 1999 81 88 90 86
60 2000 81 77 70 62
40
2001 78 69 67 64
20
0
2002 84 71 72 50
2003 100 88 81 74
5
7
/9
/9
/9
/9
/9
/0
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Finland - pine Sweden - pine Germany - spruce

2004 108 98 89 78
Austria - spruce Czech R - spruce
2005 105 86 91 85
Conifer Sawlog Price Index 1995 - 3Q/2007 Latin America & Asia
250
Latin America, Asia & Oceania (1q/1995=100)
1q/1995 = 100 (Based on price in US$)
200
Bra Chl NZ Jpn S Jpn Df
150 1997 81 103 95 72 85
1998 79 89 71 60 72
100
1999 56 92 69 69 78
2000 73 91 66 66 79
50
2001 68 88 55 54 70
0 2002 66 92r 63 46 66
2003 88 94r 74 51 69
5
7
/9
/9
/9
/9
/9
/0
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
New Zealand - pine Brazil - pine Chile - pine 2004 124 104r 84 52 77
Japan - Sugi Japan - Douglas-fir (US)
2005 169 108 86 47 75

Wood Resource
Quarterly
Conifer Sawlog Price Index 1995-2006

(1q/1995=100, Based on local currency)
160
Conifer Sawlog Price Index 1995 - 3Q/2007 North America
1q/1995=100 (Based on price in local currency)
North America
140 (1q/1995=100)
120 US S US W BC C BC I Que
100
1997 104 97 68 103 103
80
1998 109 90 50 94 106
60
1999 103 94 50 88 112
40
2000 106 85 52 93 114
20
2001 98 71 44 87 117
0
2002 99 71 50 81 119
2003 100 66 42 75 124
5
7
/9
/9
/9
/9
/9
/0
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
US South - Pine US NW - Hemlock BC Coast - Hemlock
2004 103 77 42 75 130
BC Interior - SPF Quebec 2005 107 88 37 77 131
Conifer Sawlog Price Index 1995 - 3Q/2007 Europe

180 Europe
(1q/1995=100)
1q/1995 = 100 (Based on price in local currency)
160
140
Finl Swe Aust Ger
120 1997 108 95 98 95
100 1998 110 99 103 102
80 1999 111 98 108 101
60 2000 114 95 100 84
40
2001 113 96 99 87
20
2002 115 94 101 85
0
2003 115 96 95 82
5
7
/9
/9
/9
/9
/9
/0
/0
/0
/0
/0
/0
/0
/0
2004 112 98 94 80
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Finland - pine Sweden - pine Germany - Spruce

Austria - spruce Czech R - spruce 2005 110 86 96 86
Conifer Sawlog Price Index 1995 - 3Q/2007 Latin America & Asia
Latin America, Asia & Oceania (1q/1995=100)
.
160
1q/1995 = 100 (Based on price in local currency)
140 Bra Chl NZ Jpn S Jpn Df

120 1997 106 104 92 91 107
100 1998 111 99 84 81 97
80 1999 123 114 83 81 92
60 2000 162 119 92 74 89
40 2001 193 135 84 68 89
20
2002 230 143 86 60 87
0
2003 326 140 82 62 83
5
2004 438 140r 81 58 86

/9
/9
/9
/9
/9
/0
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
New Zealand - pine Chile - pine

Japan - Sugi Japan - Douglas-fir (US)
2005 493 140 78 53 86
Notes.
Three main criteria were used to choose geographical regions and conifer log grades for presentation in the WRQ:
1) Conifer lumber production in the region is among the twenty-five top producing regions in the world.
2) Conifer log grade/grades are commonly processed in the region.
3) Log species and grades are mainly average logs being processed into construction and better grades lumber in the
region. The intention is to not include pruned logs or logs typically used to produce low-grade products such as
pallets and packaging components.

Wood Resource
Quarterly
Sawlog and Pulpwood Markets - USA

US Wood Prices Slightly Higher regions more competitive now than they were in the
1990's. There is a substantial discrepancy in fiber costs
With a few exceptions, wood fiber prices were either
between the low-cost regions of BC, Alberta and the
unchanged or slightly higher in most regions of the US
US South as compared to the highest cost regions of
in the 2Q. The only regions with reduced wood cost
Ontario and Quebec. Despite declining prices in East-
were the Lake States and northeast US, where pulpmill
ern Canada, the region still has almost twice as high
closures and production curtailments reduced the de-
fiber costs as other major pulp-producing regions of
mand for wood fiber. In the Lake States, pine pulp-
North America.
wood fell almost 7 % over the winter months as a result
of lower demand and high pulpwood supply. Aspen and
mixed hardwood prices were down by as much as 12% Low Wood Fiber Inventories Has a Price
and are lower than for most other regions in North Wood fiber consumption in May reached the highest
America. level since December of 2000. The high fiber usage
has been the result of improving markets and higher
Higher Fuel Costs Impact Fiber Prices prices for the key products manufactured in the North-
Wood fiber costs have gone up a dollar or two per odmt west, including linerboard, newsprint and market pulp.
in the US South this quarter as a result of higher fuel
costs. The largest increases over the past year have Some pulpmills in the Northwest are struggling to keep
been in residual chips in the South Central states. Pine a sufficient supply of wood fiber and inventory levels
residuals were at $74/odmt in the 2Q/06 or 14% up are record low. The move towards just-in-time inven-
from 2Q/05 and hardwood residual chips, a small per- tories the past few years has not been the choice of
centage of the total wood fiber consumption, were at fiber procurement managers but rather a policy move
$64/odmt or 10% higher than in 2Q/05. by company executives and accounting departments
as a way to cut production costs.
The major reason for the higher costs for chips are
increased fuel costs. Transport costs are up 50% from We may now have seen the "low-inventory" policy
just 12 months ago. Chip prices at the sawmills have having gone too far with some pulp and paper mills in
not changed much the past few years. the region paying a price by not being able to run at
full capacity due to the lack of wood fiber. And this is
According to our sister publication, the North Ameri-
at a time when prices for many pulp and paper grades
can Wood Fiber Review, the US South wood fiber
are moving upward.
costs continue to be among the lowest in North America
although costs in western US and Canada have de-
clined substantially the past few years making those A Softer Lumber Market has not Yet Impacted
Log Prices
Conifer Wood Fiber Prices in 2Q/2006
160 North America Sawlog prices in western US have reached the high-
140
est levels in almost ten years as the result of an ex-
120
Conifer, chips panding sawmill sector. The total lumber production
100
Conifer, roundwood
in 2005 was the highest since 1990. The high log costs
US$/green tons
80
and falling lumber prices have reduced profitability for
60
many sawmills and an increasing number of plants have
cut back on production in the 2Q. Production in May
40
was the lowest in three years. Log prices in the South
20
have come down slightly as logging conditions have
0
US, US, Lake
Northwest States
US, US, US, South
Northeast Southeast Central
Canada,
BC
Canada,
Alberta
Canada,
Ontario
Canada,
Quebec
Canada,
Maritimes
been favorable this spring and demand is slightly lower.

Wood Resource
Quarterly
US South - Sawlog and Pulpwood Prices
Conifer Sawlog Prices - US South Pine Sawlog Prices

90
(US$/m3)
80
70 1q/2004 66
60 2q 66
US$/m3ub
50 3q 70
40 4q 71
30 1q/2005 70
20 2q 71
10
3q 70
0
4q 72
1q/2006 72
95
96
97
98
99
00
01
02
03
04
05
06
07
9
0
2q 70
/1
/1
/1
/1
/1
/2
/2
/2
/2
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
100 Conifer Wood Fiber Prices in the U.S. South Conifer Pulpwood Prices
90
(US$/odmt)
80
Chips Rdwd
US$/odmt - Delivered
70
60
1q/2005 65 76
2q 64 76
50 Roundwood
Chips
3q 66 76
40
4q 68 78
30
1q/2006 68 78
20
2q 68 80
10
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Non-Conifer Pulpwood Prices

Non-Conifer Wood Fiber Prices in the U.S. South
90 (US$/odmt)
80
70 Chips Rdwd
1q/2005 59 79
60
50
2q 60 79
Roundwood 3q 61 81
40
Chips 4q 61 83
30
1q/2006 62 82
20
2q 63 82
10
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
US Northwest - Sawlog and Pulpwood Prices

Conifer Sawlog Prices
Conifer Sawlog Prices - US NW (US$/m3)
140
Douglas-fir Hemlock
120
1q/2005 115 77
100 2q 112 79
3q 108 77
US$/m3ub
80
4q 112 78
60
1q/2006 119 80
40 Douglas-fir 2q 119 81
Hemlock
20
0
5
7
99
99
99
99
99
00
00
00
00
00
00
00
00
/1
/1
/1
/1
/1
/2
/2
/2
/2
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Conifer Pulpwood Prices

180
Conifer Wood Fiber Prices in the U.S. Northwest (US$/odmt)
160
Roundwood
140 Chips Chips Rdwd
1q/2005 72 62
120
2q 73 62
100
3q 72 64
80 4q 73 64
60 1q/2006 76 67
40 2q 79 69
20
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

160
Non-Conifer Wood Fiber Prices in the U.S. Northwest (US$/odmt)
140 Roundwood
Chips Chips Rdwd
120
1q/2005 93 62
100 2q 94 62
80 3q 94 67
4q 94 64
60
1q/2006 95 69
40
2q 97 72
20
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Sawlog and Pulpwood Markets - Canada

Lumber Production Stays Strong in 2006 terior of BC is now railed out to coastal BC and re-
places some of the more expensive local roundwood
Somewhat surprisingly, sawmills in both western and
chips. The trade with Alberta has also changed with
Eastern Canada continued to run at high production
less being imported and slightly more exported to the
levels despite lower lumber prices in the US market
neighboring province.
and a strengthening Canadian dollar. In fact, total pro-
duction in Canada in the 1Q/06 was the highest it has
Higher Fiber Prices in British Columbia
been in at least five years. Even in Eastern Canada,
where conifer sawlog costs are the highest in North Average conifer chip prices were up three dollars to
America, production in March was at a two year high. US$63/odmt in the 2Q and pulplogs were up 10% to
It can be expected that the output of lumber will de- US$69/odmt. Despite the increase, BC has some of
cline in the coming months due to the weakening de- the lowest wood fiber costs in the world.
mand in the US market.
BC wood chip trade has declined this year with ex-
Thanks to the high volumes of residual chips, some ports down 9% and imports 27% lower than last year.
pulpmills have been able to reduce the usage of the The province continues to be a net importer of chips
more expensive roundwood chips this quarter. with fiber being imported from the state of Washing-
ton. Most wood chips are exported to the US and
Wood Fiber Prices Fell in Ontario and Quebec Japan but there are also smaller volumes shipped to
Wood fiber prices in Ontario and Quebec fell between pulpmills in the province of Alberta.
6-8% early in the year and have remained stable in
Canadian dollars but increased in US dollar terms.
With higher supplies of chips it could be expected that Historical Canadian Exchange Rates
prices would fall more this quarter. This price adjust-
Historical Exchange Rate: Canadian $/US$
ment however, did not materialize for two reasons: 1.8
1.6
some supply contracts are set on a annual basis; and
1.4
many pulpmills are reluctant to reduce the chip prices
1.2
too much because of the risk that the reduced income
1.0
C$/US$
for the supplying sawmill might force them to shut 0.8

down, which would then result in a more limited future 0.6
chip supply. 0.4
0.2
Conifer chip prices in Ontario and Quebec were 0.0
C$155/odmt and $160/odmt, respectively, the low- 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q

88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07
est in two years. Depending on the pace of pulpmill

closures in Quebec as a result of the reduced AAC in Canadian $/US$
the province, wood fiber costs are likely to decline
somewhat more over the next 12 months. 1q/2003 1.512 1q/2005 1.226
2q 1.398 2q 1.244
3q 1.397 3q 1.204
Fiber Surplus Disappearing in the West 4q 1.317 4q 1.174
The fiber supply situation in western Canada has 1q/2004 1.318 1q/2006 1.155
changed the past six months with Interior British Co- 2q 1.359 2q 1.124
lumbia and Alberta moving from chip surpluses to a 3q 1.309
fiber market in balance. Most of the surplus in the In- 4q 1.221

Wood Resource
Quarterly
Canada West - Sawlog and Pulpwood Prices

Conifer Sawlog Prices - Coast
Conifer Sawlog Prices - BC Coast (US$/m3)
140
Douglas-fir Hemlock
120
Douglas-fir 1q/2004 79 45
Hemlock
100 2q 82 49
3q 85 50
US$/m3ub
80
4q 89 45
60
1q/2005 78 45
40 2q 77 43
20 3q 79 43
4q 88 46
0
1q/2006 84 45
5
7
2q 93 44
99
99
99
99
99
00
00
00
00
00
00
00
00
/1
/1
/2
/2
/2
/1
/1
/1
/2
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Conifer Sawlog Prices - Interior

Conifer Sawlog Prices - BC Interior
70 (US$/m3)
Spruce/pine/fir
60
1q/2004 42
50 2q 44
3q 43
US$/m3ub
40
4q 46
30
1q/2005 45
20 2q 51
10
3q 47
4q 50
0
1q/2006 50
2q 55
5
7
99
99
99
99
99
00
00
00
00
00
00
00
00
/1
/1
/1
/1
/1
/2
/2
/2
/2
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

160
Conifer Wood Fiber Prices In Western Canada (US$/odmt)
140 Roundwood
Chips Chips Rdwd
120
1q/2005 69 57
100 2q 63 60
80 3q 60 59
60
4q 59 61
1q/2006 60 63
40
2q 63 69
20
88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07
1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q 1q

Wood Resource
Quarterly
Canada East - Sawlog and Pulpwood Prices

Conifer Sawlog Prices - Quebec Conifer Sawlog Prices
80
(US$/m3)
70
60 Mixed
50
1q/2005 66
US$/m3ub
2q 65
40
3q 67
30 4q 69
20 1q/2006 66
10 2q 68
0
5
7
99
99
99
99
99
00
00
00
00
00
00
00
00
/1
/1
/2
/2
/1
/1
/1
/2
/2
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
180
Conifer Wood Fiber Prices - Eastern Canada (US$/odmt)
160
140
Chips Rdwd
1q/2005 131 143
120
2q 135 140
100
3q 139 145
80
Roundwood
Chips
4q 142 149
60
1q/2006 137 145
40 2q 140 149
20
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

140 Non-Conifer Wood Fiber Prices - Eastern Canada (US$/odmt)
120
Chips Rdwd
Roundwood
100 1q/2005 68 77
Chips
80
2q 67 76
3q 69 78
60
4q 71 80
40 1q/2006 72 82
2q 74 84
20
88 q 89 q 90 q 91 q 92 q 93 q 94 q 95 q 96 q 97 q 98 q 99 q 00 q 01 q 02 q 03 q 04 q 05 q 06 q 07
1q 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

Wood Resource
Quarterly
Sawlog and Pulpwood Markets - Europe

The harvests of industrial roundwood in Europe Sawlog and pulpwood prices in Sweden have gone
trended upward the past 15 years reaching a new up this year but are still lower than before the storm
record high of 403 million m3 in 2005. This increase last year. Sawmills and pulpmills are running at high
was 8% higher than the previous year and as much as operating rates and the demand for high quality newly-
17% higher than five years ago. cut logs is high. Prices for timber and pulpwood can
be expected to go up in the 3Q and be back to “pre-
450
Roundwood Harvests in Europe 1993 - 2005 storm” levels.
400
350
Finland is Cutting Back on Harvesting
300
250 The reduced demand for logs by the Finnish forest

200 industry last year resulted in a 15% decline of harvests
150
on nonindustrial private land. The decline has contin-
100
ued this year but for a different reason. Finland imple-
50
0
mented a new forest taxation law of January 1 this
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 year. Rather than taxing the annual growth of a
Source: ECE/FAO Conifer Non-conifer Total
landowner’s forest, the new tax is assessed on the
actual timber volumes sold. Initially the new system
has resulted in limited interest in logging by small land-
The removals of industrial roundwood in Europe have
owners that do not necessarily require periodic rev-
not only increased in real terms over the past five years,
enues from their forests. Although total timber pro-
but the region has also grown in importance as a glo-
duction was down over 20% for the first six months
bal supplier of softwood-based forest products. Be-
this year, harvesting activities took off later in the sec-
tween 2001 and 2005, the conifer harvests in Europe
ond quarter and were substantially higher in June com-
increased from 26.7% of the global conifer harvests
pared to the same month last year.
to an estimated 28.9%. Conifer removals in Europe
now exceed that of the US for the first time since 2000
Higher Log Costs for Sawmills and Pulpmills in
when a major storm hit southern Germany and tem-
Germany
porarily spiked timber removals in Central Europe.
The market dynamics for residues and pulplogs are
Huge Inventories of Logs in Sweden changing in Germany with increased competition for
wood chips between manufacturers of pulp, wood-
As a result of hurricane Gudrun that hit Sweden and
based panels and the energy sector. There are also
the Baltic States in early 2005, harvest levels almost
changes in the demand for small-diameter hardwood
doubled in Southern Sweden compared to 2004. The
log, which increasingly are used for energy purposes,
increased supply of particularly spruce impacted the
both by commercial energy producers and private
flow of logs in the Baltic Sea region. As a result of the
households. This has resulted in substantially higher
high availability of logs (including both sawlogs and
costs for pulpwood, particularly beech, this spring.
pulpwood), the need for imports to Sweden declined
in 2005 and the log trade deficit declined from 7.9
Conifer sawlog prices, notably spruce logs in northern
million m3 in 2004 to just over 5.6 million m3 in 2005.
Germany, have increased as sawmills are taking ad-
Most of the over 60 million m3 of damaged timber
vantage of improved export market in both Europe
from the storm was removed by the end of May and
and the US. During the first four months of this year,
an estimated 11 million m3 is now being kept in inven-
lumber exports from Germany were up almost 40%
tory and will be processed over the next 3-4 years.
as compared to last year.

Wood Resource
Quarterly
Finland - Sawlog and Pulpwood Prices

Conifer Sawlog Prices - Finland Conifer Sawlog Prices
140
(US$/m3)
120
Pine Spruce
100
1q/2005 88 90
US$/m3ub
80 2q 83 86
60
3q 79 83
Pine 4q 77 81
40 Spruce 1q/2006 79 83
20 2q 86 89
0
95
96
97
98
99
00
01
02
03
04
05
06
07
19
19
19
19
19
20
20
20
20
20
20
20
20
/
/
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Pulplog Prices
250
Wood Fiber Prices - Finland (US$/odmt)
225
200 Conifer Roundwood Conifer Non-Con

Non-Conifer Roundwood
1q/2005 139 99
175
150 2q 132 95
125 3q 129 92
100 4q 126 91
75 1q/2006 128 92
50 2q 132 96
25
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Exchange Rate (Euros/US$)

8.0 Historical Exchange Rate: Finnish Markka/EURO per US$ 1.4
7.0 Fim/US$
1.2
1q/2004 0.801
Euro/US$
2q 0.830
6.0
1.0 3q 0.818
5.0 4q 0.772
EURO/US$
FIM/US$
0.8
4.0 1q/2005 0.762
0.6 2q 0.794
3.0
3q 0.820
0.4
2.0 4q 0.841
1.0 0.2 1q/2006 0.832
2q 0.796
0.0 0.0
1q 8
89
1q 0
1q 1
1q 2
1q 3
1q 4
1q 5
96
1q 7
1q 8
99
1q 0
1q 1
1q 2
1q 3
1q 4
05
1q 6
07
8
9
9
9
9
9
9
9
9
0
0
0
0
0
0
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Norway - Sawlogs and Pulpwood Prices

Conifer Sawlog Prices - Norway Conifer Sawlog Prices
120 (US$/m3)
100
Pine Spruce
80 1q/2004 67 68
US$/m3ub
2q 64 68
60
3q 64 69
40 Pine 4q 72 73
Spruce 1q/2005 77 77
20 2q 73 74
0
3q 71 75
4q 72 73
5
7
99
99
99
99
99
00
00
00
00
00
00
00
00
1q/2006 74 74
/1
/1
/1
/1
/1
/2
/2
/2
/2
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

200
Conifer Wood Fiber Prices - Norway (US$/odmt)
180 Roundwood
160 Chips Chips Rdwd
1q/2004 106 127
140
120 2q 107 128

100 3q 103 125
80 4q 112 137
60 1q/2005 115 141
40 2q 113 140
20 3q 109 139
0 4q 106 133
1q/2006 106 131
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Exchange Rate (Kroner/US$)

10
Historical Exchange Rate: Norwegian Krone/US$
9
1q/2004 6.91
8
2q 6.86
7
3q 6.87
4q 6.33
Nkr/US$
5 1q/2005 6.29
4 2q 6.40
3 3q 6.47
2 4q 6.63
1 1q/2006 6.68
0 2q 6.24
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Sweden - Sawlog and Pulpwood Prices

Conifer Sawlog Prices - Sweden
100 (US$/m3)
90
80 Pine Spruce
70 1q/2004 75 73
60 2q 72 70
US$/m3ub
50 3q 71 73
Pine
40
Spruce 4q 79 78
30 1q/2005 74 70
20 2q 69r 66r
10 3q 61r 60r
0 4q 65r 62r
1q/2006 70 67
5
7
99
99
99
99
99
00
00
00
00
00
00
00
00
/1
/1
/2
/2
/2
/2
/1
/1
/1
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Pulpwood Prices
200
Wood Fiber Prices - Sweden (US$/odmt)
180
Conifer Roundwood
160 Conifer Chips Chips Roundwood
Non-Conifer Roundwood
140 Con Con Non-c
120 1q/2005 129 131 98

100 2q 115 132 92
80 3q 96 121 90
60 4q 93 116 87
40 1q/2006 100 116 90
20 2q 99 122 96
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Exchange Rate (Kronor/US$)

12
Historical Exchange Rate: Swedish Krona per US$
10
1q/2004 7.35
2q 7.60
8 3q 7.49
Skr/US$
4q 6.96
6
1q/2005 6.92
4
2q 7.31
3q 7.67
2 4q 7.97
1q/2006 7.78
0
2q 7.41
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
France - Pulpwood Prices

180
Conifer Wood Fiber Prices - France (US$/odmt)
160 Roundwood
140
Chips Chips Rdwd
1q/2005 110 132
120
2q 105 126
100
3q 102 129
80
4q 99 126
60 1q/2006 126r 135r
40 2q 134 142
20
88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07
Non-Conifer Pulplog Prices

140 Non-Conifer Wood Fiber Prices - France
(US$/odmt)
120
1q/2004 73
100
2q 71
80 3q 74
4q 71
60
1q/2005 80
40 2q 76
20
3q 74
4q 77
0 1q/2006 91
88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 2q 98
Historical Exchange Rate: French Franc/EURO per US$

Exchange Rate (Euro/US$)
8.0 1.2
FF/US$
7.0
EURO/US$ 1.0
1q/2004 0.801
6.0
2q 0.830
0.8 3q 0.818
5.0
4q 0.772
EURO/US$
FF/US$
4.0 0.6 1q/2005 0.762

3.0
2q 0.794
0.4
3q 0.820
2.0
4q 0.841
0.2
1.0 1q/2006 0.832
0.0 0.0
2q 0.796
1q 8
1q 9
1q 0
1q 1
1q 2
1q 3
1q 4
1q 5
1q 6
1q 7
1q 8
1q 9
1q 0
1q 1
1q 2
1q 3
1q 4
05
1q 6
07
8
8
9
9
9
9
9
9
9
9
9
9
0
0
0
0
0
0
1q
1q

Wood Resource
Quarterly
Germany - Sawlog and Pulpwood Prices

Conifer Sawlogs
Conifer Sawlog Prices - Germany
180 (US$/m3)
160
140 Spruce
120 1q/2005 101
2q 103
US$/m3ub
100
80
3q 99
4q 98
60
1q/2006 100
40
2q 112
20
0
95
96
97
98
99
00
01
02
03
04
05
06
07
19
19
19
19
19
20
20
20
20
20
20
20
20
/
/
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Pulpwood Prices - Germany

Pulpwood Prices
250
(US$/odmt)
Conifer pulplogs
200 Conifer chips
Non-conifer pulplogs
Chips Roundwood
Con Con Non-c

150
1q/2005 100 148 108
2q 96 138 103
100
3q 93 134 100
4q 101 140 123r
50
1q/06 108r 142 145r
2q 118 145 152
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Historical Exchange Rate: German Marks/EURO per US$ Exchange Rate (Euro/US$)
2.5 1.2
DM/US$
EURO/US$ 1.0
1q/2004 0.801
2.0
2q 0.830
0.8 3q 0.818
1.5
4q 0.772
EURO/US$
DM/US$
0.6 1q/2005 0.762

1.0 2q 0.794
0.4
3q 0.820
0.5
0.2
4q 0.841
1q/2006 0.832
0.0 0.0 2q 0.796
1q 8
1q 9
1q 0
91
1q 2
1q 3
1q 4
1q 5
1q 6
1q 7
1q 8
99
1q 0
1q 1
02
1q 3
1q 4
05
1q 6
07
8
8
9
9
9
9
9
9
9
9
0
0
0
0
0
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Spain - Pulpwood Prices

Conifer Wood Fiber Prices - Spain
120 (US$/odmt)
105
Chips Rdwd
90
1q/2005 86 66
75
2q 82 62
60 3q 79 60
45 Roundwood
4q 76 58
Chips 1q/2006 76 56
30
2q 80 58
15
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Non-Conifer Pulplog Prices

Non-Conifer Wood Fiber Prices - Spain
180 (US$/odmt)
160
140 1q/2005 92
2q 88
120
100
3q 86
80
4q 83
1q/2006 83
60
2q 87
40
20
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Exchange Rate (Euro/US$)

200
Historical Exchange Rate: Spanish Pesetas/EURO per US$ 1.2
180 Pts/US$ 1q/2004 0.801

1.0
160
EURO/US$
2q 0.830
140 3q 0.818
0.8
120 4q 0.772
EURO/US$
Pts/US$
100 0.6
1q/2005 0.762
80
2q 0.794
0.4 3q 0.820
60
4q 0.841
40
0.2 1q/2006 0.832
20
2q 0.796
0 0.0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Austria, Estonia and Latvia - Sawlog Prices

Conifer Sawlog Prices - Austria
140 (US$/m3)
120
Spruce
100
1q/2005 102
2q 99r
US$/m3ub
80
3q 98r
60
4q 97r
40 1q/2006 100r
20
2q 107
0
5
7
99
99
99
99
99
00
00
00
00
00
00
00
00
/1
/1
/1
/1
/1
/2
/2
/2
/2
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Conifer Sawlog Prices - Estonia
140 (US$/m3)
120
Spruce
Spruce Pine
100
Pine 1q/2005 75 71
2q 68 63
US$/m3ub
80
3q 64 62
60
4q 67 66
40 1q/2006 69 68r
20
2q 72 70
0
95
96
97
98
99
00
01
02
03
04
05
06
07
/
/
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Conifer Sawlog Prices - Latvia
140 (US$/m3)
120
Spruce Pine
100 1q/2005 79 82
2q 50 43
US$/m3ub
80
3q 61 63
60
4q 73 71
40 Spruce 1q/2006 68 67
Pine 2q 73 68
20
0
3q
3q
3q
3q
3q
3q
3q
3q
0
7
/0
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Czech Republic and Poland - Sawlog Prices

Conifer Sawlog Prices - Czech Republic
120 (US$/m3)
100
Spruce rev.
80
1q/2005 89
2q 86
US$/m3ub
60 3q 82
4q 83
40
1q/2006 94
20
2q 97
0
3q
3q
3q
3q
3q
3q
3q
3q
3q
3q
3q
5
6
/9
/9
/9
/9
/9
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Conifer Sawlog Prices - Poland
90 (US$/m3)
80
70
Pine
60
1q/2005 68
2q 60
US$/m3ub
50
3q 60
40
4q 60r
30
1q/06 62
20 2q 63
10
0
3q
3q
3q
3q
3q
3q
3q
3q
3q
8
7
/9
/9
/0
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Northwest Russia - Sawlog and Pulpwood Prices

Conifer Sawlog Prices - Northwest Russia
80 (US$/m3)
70
60 Pine
Pine Spruce
Spruce 1q/2005 40 38
50
2q 41 42
US$/m3ub
40 3q 39 38
30 4q 42 41
20
1q/2006 41 39
2q 42 44
10
0
3q
3q
3q
3q
3q
3q
1
7
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
Pulplog Prices
140 Wood Fiber Prices - Northwest Russia
(US$/odmt)
120
Conifer roundwood
Non-conifer roundwood
Conifer Non-Con
100
1q/2005 63 42
80 2q 61 47
3q 63 48
60
4q 66 51
40 1q/2006 61 50
2q 70 55
20
0
3q
3q
3q
3q
3q
3q
3q
1
7
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
Exchange Rate (Roubles/US$)

35
Historical Exchange Rate: Russian Rouble per US$
30
1q/2004 28.64
2q 28.91
25
3q 29.18
RUB/US$
20 4q 28.54
1q/2005 27.85
15
2q 28.09
10 3q 28.52
5
4q 28.71
1q/2006 28.16
0 2q 27.22
3q
3q
3q
3q
3q
3q
3q
1
7
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Sawlog and Pulpwood Markets - Latin America

A New Pulp Production Record in Latin America ports of lumber, particularly to the key market in the
US, have declined substantially due to an unfavourable
With recent investments in pulp capacity and strong
exchange rate as compared to competitors in Canada
demand for pulp globally, production of market pulp
and Europe. During the 5 first months of the year, US
has reached a new production record in the 1Q when
lumber imports from Brazil were down 14% while they
the total production in Latin America was up to 2.3
were up by 39% from Germany and 22% from Swe-
million tons, or 12% higher than last year, according
den. Sawlog prices (in US dollars) in the open market
to Hawkins Wright.
have more than tripled in three years due to a tighter
Market Pulp Production - Latin America
supply of pine timber. Pulpwood traded in the open
2500
market, which is a relatively small share of the total
2000 wood fiber supply to the Brazilian pulpmills, contin-
ued up in the 2Q and averaged US$78/odmt for pine
1500 and US$83/odmt for Eucalyptus logs.
1000 tonnes
1000
The Chilean Sawmill Industry is Expanding
500 After almost three years of continued price increases
(in US dollar terms), conifer sawlog prices stabilized
0
in the 2Q and averaged $43/m3, the highest level since
3q
3q
3q
3q
3q
3q
3q
3q
8
6
/9
/9
/0
/0
/0
/0
/0
/0
/0
1q
1q
1q
1q
1q
1q
1q
1q
1q
at least 1995. Being one of the lowest-cost regions of

Uruguay Attracts New Pulpmill Investors the world, the sawmilling industry has benefited from
very competitive production costs and made inroads
European pulp companies interested in investing in new
in particularly the US market. Exports of softwood
pulp mills in Uruguay have grown from two to three
lumber to the US have increased from 2.2 million m3
with Stora Enso joining the Spanish firm ENCE and
in 2001 to 3.2 million m3 in 2005. Based on the first
the Finnish Metsa-Botnia in planning a green field mar-
four months of 2006, it seems likely that this year will
ket pulp mill based on fiber from fast-growing planta-
be a new record-breaking year for the industry.
tions. Stora Enso has received permission from the
government to build a one million ton/year pulpmill in
The pulp market has also gone through a transition
the central region of the country (state of Duranzo)
with an ever-increasing demand for pulpwood from
further east from the two pulpmills already planned in
the expanding pulp industry. The forest company
Fray Bentos. The construction of the Botnia pulpmill
Arauco will add another 860,000 tpy of Eucalyptus
has recently had a few short stoppages due to pro-
and Radiata pine pulp in the 3Q when the new plant in
tests, an accident and on the governments request to
Nueva Aldea in southern Chile start up. Full capacity
review the environmental impact. The work on the plant
is expected to be reached in the fall of 2007. CMPC,
was continuing in June and the start-up up date is still
the other major forest company in Chile, will add a
3Q/07. The land has been cleared for the ENCE pulp-
new pulp line at its plant in Santa Fe in September,
mill but the construction of the building has not yet
which will have a capacity of 780,000 tpy.
been started. There have been reports that ENCE is
considering a different location for the plant further
With the expansion of pulp capacity, pulpwood prices
away from the competing Botnia plant.
have more than doubled in three years and were, in
the 2Q, approximately $65/odmt for both Eucalyptus
Sawlog Prices Have Tripled in 3 Years in Brazil
and pine logs. This rise in prices is due to a combina-
Pine sawlog prices in Brazil increased slightly this quar-
tion of higher prices in the local currency and a weak-
ter despite lower demand from the sawmill sector. Ex-
ening of the US dollar vs. the Pesos.

Wood Resource
Quarterly
Brazil - Sawlog and Pulpwood Prices

Conifer Sawlog Prices - Brazil
70 (US$/m3)
60
Pine
50
1q/2005 45
US$/m3ub
40 2q 50
3q 55
30
4q 57
20 1q/2006 58
10
2q 60
0
5
7
99
99
99
99
99
00
00
00
00
00
00
00
00
/1
/1
/2
/2
/1
/1
/1
/2
/2
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Pulpwood Prices
120 Conifer Wood Fiber Prices - Brazil
(US$/odmt)
Conifer Roundwood
100
Conifer Chips Chips Roundwood
Non-Con Roundwood
80 Con Con Non-c

1q/2005 74 60 63
60 2q 81 65 68
3q 88 72 75
40
4q 92 74 79
20 1q/2006 91 75 81
2q 92 78 83
0
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Exchange Rate (Reais/US$)

4.0 Historical Exchange Rate: Brazilian Reais per US$
3.5 1q/2004 2.895

2q 3.042
Brazilian Reais per US$
3.0
3q 2.980
2.5
4q 2.789
2.0 1q/2005 2.663
1.5 2q 2.485
3q 2.348
1.0
4q 2.249
0.5 1q/2006 2.198
0.0 2q 2.189
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Chile - Sawlog and Pulpwood Prices
50 Conifer Sawlog Prices - Chile Conifer Sawlog Prices

45
(US$/m3)
40
35
Pine
30
1q/2005 38
US$/m3ub
25
2q 38
20
3q 40
15
4q 41
10
1q/2006 43
5
2q 43
0
5
7
99
99
99
99
99
00
00
00
00
00
00
00
00
/1
/1
/1
/1
/1
/2
/2
/2
/2
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Pulplog Prices
90 Wood Fiber Prices - Chile (US$/odmt)
80
70
Conifer Non-Con
1q/2005 65 59
60
2q 65 64
50
3q 70 65
40
4q 71 64
30 1q/2006 69 65
Conifer Roundwood
20
Non-conifer Roundwood
2q 65 64
10
0
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Exchange Rate (Pesos/US$)

800
Historical Exchange Rate: Chilean Peso/US$
700 1q/2004 602.0

600
2q 645.0
3q 641.4
Chilean Peso/US$
500
4q 598.4
400 1q/2005 584.2
300 2q 581.9
200
3q 554.1
4q 527.8
100
1q/2006 532.5
0 2q 543.5
90 q 91 q 92 q 93 q 94 q 95 q 96 q 97 q 98 q 99 q 00 q 01 q 02 q 03 q 04 q 05 q 06 q 07
1q 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

Wood Resource
Quarterly
Sawlog and Pulpwood Markets - Asia & Oceania

Higher Costs for Eucalyptus Logs in Australia Pulpwood prices have remained stable in NZ dollars
but have declined in US dollar terms. Pine chip prices
In Australia, prices for conifer and non-conifer pulp-
in the 2Q were down 8% from last year to US$78/
wood were up to their highest levels in more than eight
odmt and pine pulplog prices have fallen 7% to US$64/
years because demand from both the domestic and
odmt. The pulp industry now has some of the lowest
export markets were strong. The biggest change in
conifer wood fiber costs in the world, even lower than
demand was for Eucalyptus pulplogs, which cost 4.8%
open market logs in Brazil. Wood fiber costs are pre-
more this quarter compared to a year ago.
dicted to remain at the current levels the rest of the
year although they could decline slightly if log exports
Plans for additional pulp capacity continues in Austra-
take off and harvesting activities go up. Wood chip
lia with Australia Paper planning to expand the pulp
prices may eventually experience some small increases
capacity at their Victoria plant, a project that will re-
next quarter due to higher fuel prices.
quire an additional 400,000 m3 of pulpwood, evenly
split between softwood and hardwood. The announced
As a result of the reduced competitiveness of the New
plan for a new 350,000 tpy CTMP plant in Penola,
Zealand forest industry the past 3-4 years, timber har-
South Australia, is expected to run into resistance from
vests have gone through a steady decline and were in
the local environmental community and the timing for
the 1Q/06 the lowest since 1999. The annual harvest
the start-up is uncertain. As evidence of how difficult,
peaked in 2002 at 27.5 million m3 and was in 2005
costly and time-consuming it can be to obtain approval
down to 23.9 million m3.
for a new pulpmill in Australia, the Gunns Ltd. pro-
posed 820,000 tpy pulpmills in Tasmania is a case in Timber Harvests in New Zealand 1998 - 2006
7
point. The company just submitted its Integrated Im-
6
pact Statement (IIS) and the study covered 7500
pages, took over 350,000 hours to conclude at a cost
of 11 million dollars. 4
3
A Weakening NZ Dollar Good News for the For-
2
est Industry
1
After a few years of mostly downbeat news about the
0
forest industry in New Zealand, there are finally some
3q
3q
3q
3q
3q
3q
3q
3q
8
6
/9
/9
/0
/0
/0
/0
/0
/0
signs of optimism in the country. Demand for all log /0

1q
1q
1q
1q
1q
1q
1q
1q
1q
grades has gone up the past few months and the value Pulpwood Supply from Indonesia’s Natural For-
of the NZ dollar, which is so important for the export- ests Uncertain
oriented forest industry, has weakened the past year.
The Ministry of Forestry in Indonesia has raised the
This has helped the export market with slightly greater
annual allowable harvest from 5 to 8 million m3 per
shipments to China and India and higher export prices
year. This applies, however, only to timber selectively
for logs.
felled from natural forest timber concessions and des-
tined for the nation’s sawmills and plywood plants.
The higher export prices have not yet had any real
The limit does not apply to logs destined for pulp mills.
impact on domestic prices, but it can be expected that
As a result the change will not affect the availability or
those prices will start to rise later this year. Thanks to
price of pulpwood. ‘Sustainable harvest’ levels for
the weakening NZ dollar, domestic sawlog prices have
areas of natural forest that will be clear felled during
fallen in US dollar terms from an average of US$61/
the next 2.5 years to feed the nation’s pulp sector have
m3 to US$52/m3 for the S1/S2 grade.
not yet been set.

Wood Resource
Quarterly
Australia - Pulpwood Prices

135
Conifer Wood Fiber Prices - Australia (US$/odmt)
120
105
Chips Rdwd
Roundwood 1q/2005 64 61
90
Chips 2q 64 62
75
3q 66 61
60
4q 67 60
45 1q/2006 66 59
30 2q 68 62
15
0
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

140 Non-Conifer Wood Fiber Prices - Australia (US$/odmt)
120
Chips Rdwd
100 1q/2005 101 81
80
2q 104 79
3q 102 75
60
4q 101 74
40 1q/2006 102 75
Roundwood 2q 105 79
20 Chips
0
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Exchange Rate (Australian $/US$)

2.5
Historical Exchange Rate: A$ per US$
1q/2004 1.309
2.0 2q 1.399
3q 1.410
4q 1.321
Australian$/US$
1.5
1q/2005 1.286
1.0 2q 1.301
3q 1.317
0.5 4q 1.344
1q/2006 1.353
0.0 2q 1.340
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
New Zealand - Sawlog and Pulpwood Prices

80
Conifer Sawlog Prices - New Zealand (US$/m3)
70
Pine
60
1q/2005 61
50
2q 61
US$/m3ub
40 3q 58
30 4q 58
20
1q/2006 55
2q 52
10
0
95
96
97
98
99
00
01
02
03
04
05
06
07
9
0
/1
/1
/1
/1
/1
/2
/2
/2
/2
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

140 Conifer Wood Fiber Prices - New Zealand
(US$/odmt)
120 Roundwood
Chips Chips Rdwd
100
1q/2005 85 70
80 2q 85 69
3q 83 68
60
4q 84 71
40 1q/2006 82 68
20
2q 78 64
0
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Exchange Rate (NZ $/US$)

Historical Exchange Rate: NZ$/US$
2.75
2.50 1q/2004 1.486

2.25 2q 1.590
2.00 3q 1.531
1.75
4q 1.430
NZ$/US$
1.50
1q/2005 1.395
1.25
2q 1.400
1.00
3q 1.447
0.75
4q 1.441
0.50
1q/2006 1.504
0.25
0.00
2q 1.603
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Indonesia - Pulpwood Prices

65
Non-Conifer Wood Fiber Prices in Indonesia (US$/odmt)
60
55
1q/2004 41
50
2q 39
45
40 3q 37
35 4q 37
30
25
1q/2005 37
20 2q 40
15 3q 38
10
4q 42
5
0
1q/2006 45
2q 48
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Exchange Rate (Rupiah/US$)

14000 Historical Exchange Rate: Indo. Rupiah/US$
12000
1q/2004 8483
2q 9013
10000 3q 9164
Indo. Rup/US$
8000
4q 9118
1q/2005 9288
6000
2q 9559
4000 3q 10019
4q 10008
2000
1q/2006 9337
0 2q 9098
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Japan - Domestic and Imported Sawlog Prices

400
Conifer Sawlog Prices - Japan (US$/m3)
Japan - Sugi
350
US - Douglas-fir
Russia - Pine
Sugi D-f Pine Pine
300
NZ - Pine Japan US Russia NZ
US$/m3ub
250
200 1q/2005 124 260 144 126

150 2q 115 250 142 130
100
3q 106 242 141 128
4q 107 232 146 124
50
1q/2006 108 239 163 122
0 2q 109 248 164 124
5
7
99
99
99
99
99
00
00
00
00
00
00
00
00
/1
/1
/2
/2
/2
/2
/1
/1
/1
/2
/2
/2
/2
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
Conifer Sawlog Imports

1600
Conifer Sawlog Imports to Japan (1000 m3)
4q/2004-1q/2006
1400
2003 2004 2005
1200
Russia 4513 5672 4541
1000
US 2413 2633 2386
1000 m3
800 New Zealand 1344 1123 921

600 Canada 1047 1024 1009
400
Chile 132 108 87
Others 193 183 33
200
Total 9660 10743 8977
0
Russia US NZ Canada Other
4q 1q/05 2q 3q 4q 1q/06
Source: Japan Ministry of Finance
Total Sawlog Imports

Log Imports to Japan 1994 - 2005
8000
(million m3)
7000 1995 21.94
6000 1996 21.34
5000
1997 20.41
1998 15.19
1000 m3
4000
1999 16.55
3000
2000 15.95
2000 2001 13.91
1000 2002 12.66
0
2003 11.65
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
2004 12.68
US Russia Canada
SE Asia New Zealand Other
2005 10.64

Wood Resource
Quarterly
Japan - Conifer Pulpwood Prices (Delivered)

Conifer Chip Prices
225 Conifer Wood Fiber Prices in Japan
(US$/odmt)
200
Chips: Imported
175 Chips: Domestic Domestic Imported
150 1q/2005 116 140

125
2q 112 138
3q 108 142
100
4q 103 141
75
1q/2006 103 147
50 2q 105 148
25
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1400 Conifer Chip Imports to Japan Conifer Chip Imports

1200
(1000 odmt)
1000 2003 2004 2005

1000 odmt
800 Australia 1061 1216 1200

USA 762 789 870
600
New Zealand 377 229 250
400 Canadai 45 119 194
200
Fiji 126 148 113
Russia 58 57 57
0 Chile 43 52 26
Australia USA New Fiji Russia Canada Chile Others
Zealand Others 145 176 177
2003 2004 2005
Total 2619 2786 2886
Exchange Rate (Yen/US$)

180 Historical Exchange Rate: Japanese Yen/US$
160 1q/2004 107.41

140 2q 109.60
120
3q 109.90
4q 105.80
Yen/US$
100
1q/2005 104.45
80
2q 107.50
60
3q 111.19
40
4q 117.20
20 1q/2006 116.91
0 2q 114.49
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q

Wood Resource
Quarterly
Japan - Non-Conifer Pulpwood Prices

Non-Conifer Chip Prices
Non-Conifer Wood Fiber Prices in Japan
250 (US$/odmt)
225
Chips: Imported
200 Chips: Domestic Domestic Imported
175 1q/2005 146 152

150 2q 142 151
125 3q 138 157
100 4q 130 153
75 1q/2006 131 156
50 2q 134 162
25
0
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q
1q Non-Conifer Chip Imports
4000 Non-Conifer Chip Imports to Japan
(1000 odmt)
3500
3000
2003 2004 2005
Australia 3503 3701 3738
1000 odmt
2500
S.Africa 2957 3206 3241
2000 Chile 1586 1481 1642
1500 Vietnam 531 606 603
Brazil 583 552 564
1000
China 633 514 449
500 Thailand 446 394 374
0 USA 100 92 88
Australia S. Africa Chile China Brazil Vietnam Thailand USA Others Others 625 575 742
2003 2004 2005
Total 10954 11128 11442
Wood Chip Imports to Japan

Wood Chip Imports
16000
(million odmt)
14000
12000 Conifer Non-conifer

1997 3.25 10.56
1000 odmt
10000
1998 3.17 10.54
8000
1999 3.09 10.51
6000 2000 2.89 11.54
4000
2001 2.96 10.93
2002 2.74 11.00
2000
2003 2.62 10.95
0 2004 2.79 11.13
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Conifer Non-conifer Total
2005 2.62 11.48

Wood Resource
Quarterly
Pacific Rim Wood Fiber Trade - 1q/2006

(1000 odmt)
Japan Japan Taiwan S. Korea China Total Chg q/q

Source Conifer Non-con Non-con Non-con Non-con %
Australia 259 876 0 55 45 1235 -12.3

S. Africa --- 754 --- 20 --- 774 3.6
Chile 8 533 --- 22 20 583 48.7
USA 210 45 --- 41 --- 296 93.5
Vietnam --- 166 51 12 69 298 -3.6
China --- 129 20 34 --- 183 8.9
Brazil 45 137 --- --- --- 182 -24.5
Indonesia --- 24 25 --- 40 89 -9.2
Thailand --- 62 --- --- --- 62 51.2
Malaysia --- 79 --- --- --- 79 -17.7
New Zealand 48 6 --- --- --- 54 -26.0
Canada 55 --- --- 22 --- 77 24.2
Fiji 18 --- --- --- --- 18 -50.0
Other 10 142 --- --- --- 152 16.9
TOTAL 653 2953 96 206 174 4082 3.2
Pacific Rim Wood Fiber Imports 2Q/2006 - 2Q/2007

3500
3000
2500
1000 odmt
2000
1500
1000
500
0
Japan-Con Japan-NC Taiwan-NC S. Korea-NC China-NC
2q/06 3q/06 4q/06 1q/07 2q/07

Wood Resource
Quarterly
Estimated Wood Fiber Consumption by WRQ Regions in 2004

(1000 odmt)
Region Conifer Non-Conifer Total

Chips Rdwd Chips Rdwd
US, South 13720 40930 4260 20330 79240
US, Northwest 7710 2360 290 760 11120
Canada, East 9320 3200 2000 2350 16870
Canada, West 14140 900 min min 15040
Norway 775 1640 0 430 2845
Sweden 4370 10570 150 3850 18940
Finland 4220 8440 240 6160 19060
France 960 1290 190 1630 4070
Germany 1360 1635 min 600 3595
Spain 210 350 0 2930 3490
Brazil 490 3375 min 16610 20475
Chile 1600 3420 min 2090 7110
New Zealand 625 1490 min min 2115
Australia 750 760 60 440 2010
Japan 6375 min min 12610 18985
Indonesia 0 min 0 11520 11520
Total 66625 80360 7190 82310 236485
Total % 28.2 34.0 3.0 34.8 100.0

Wood Resource
Quarterly
Principal Wood Fiber Species and Average Regional Densities
(kg/m3 oven dry basis under bark)
Region Principal Species Average Density
U.S. South Conifer Pinus taeda, elliottii 509

Non-Con Quercus, Acer, Nyssa, Liriodendron 500
U.S. Northwest Conifer Pseudotsuga M., Tsuga spp. 435
Non-Con Alnus spp. 370
E. Canada Conifer Picea spp., Abies spp., Pinus banksiana 390
Non-Con Betula spp., Populus spp. 500
W. Canada Conifer Pseudotsuga M., Tsuga spp., Abies spp.,
Pinus contorta, Picea spp. 395
Norway Conifer Picea spp., Pinus silvestris 385

Non-Con Betula spp. 510
Sweden Conifer Picea spp., Pinus silvestris 385
Finland Conifer Picea spp., Pinus silvestris 385
France Conifer Picea spp., Pinus spp., Abies spp., Pseudotsuga M. 411
Non-Con Quercus spp., Fagus spp. 525
Germany Conifer Picea spp., Abies spp., Larix spp., Pinus silvestris 411
Non-Con Fagus spp. 510
Spain/Portugal Conifer Pinus pinaster., Pseudotsuga M. 435
Non-Con Eucalyptus globulus 600
Brazil Conifer Pinus taeda, elliottii, Araucaria 500

Non-Con Eucalyptus grandis & clones, Acacia spp. 475
Chile Conifer Pinus radiata 400
Non-Con Eucalyptus globulus, nitens 600
New Zealand Conifer Pinus radiata 400

Australia Conifer Pinus radiata, pinaster, Pseudotsuga M. 420
Non-Con Eucalyptus spp. 550
Japan Conifer Mixed 431

Non-Con Mixed 555
Indonesia Conifer Pinus merkusii 475

Non-Con MTH, Acacia spp., Eucalyptus spp. 500

Wood Resource
Quarterly
Recent articles in the Wood Resource Quarterly
Global Sawlog Price Trends Vol 16, No. 2
Timber Harvests and Log Trade in Russia Vol 16, No. 3

Brazil – The Changing Fiber Market Vol 16, No. 3
The Forest Industry in Latvia is Expanding Rapidly Vol 16, No. 4

South Africa as a Future Wood Fiber Supplier Vol 16, No. 4
Update on the Pacific Rim Conifer Woodchip Trade Vol 17, No. 1
Update on the Pacific Rim Non-Conifer Woodchip Trade Vol 17, No. 2
Chile: Major Advance in Pulp Production Drives the Industry Vol 17, No. 3
Illegal Logging and Global Wood Markets Vol 17, No. 4

Uruguay: A Major Fiber Exporter, but for how long? Vol 17, No. 4
Update on North American Wood Chip Trade Vol 18, No. 1

First International Pulpwood Resource and Trade Conference Vol 18, No. 1
China, the Most Important Pulp Fiber Market in the World Vol 18, No. 2
Biomass: The “Hot” Market for Wood Fiber in 2005 Vol 18, No. 2
Record Harvest Levels in Europe in 2004 Vol 18, No. 3

South Africa - Increased Pulp Production or Chip Exports? Vol 18, No. 3
Russia Increases Harvests and Log Exports in 2005 Vol 18, No. 4
Pacific Rim Wood chip Trade Update, 2005 Vol 18, No. 4
Pacific Rim Chip Price Trends, 1976 - 2006 Vol 19, No. 1
Forest Resource and Industry Profile - Finland Vol 19, No. 1
Partial List of Conference Presentation by WRI staff

Record harvests in Europe and Russia in 2004
Global Wood Fiber Supply 2004/2005
Competitiveness of the Forest Industry in Western North America
Changing Timberland Ownership Trends in the USA
China as Wood Products Exporter
Competition from Southern Hemisphere Plantation Forests
China’s Future Role in the Pacific Rim Trade of Forest Products
Emerging Trends in the Globe Trade of Forest Product
Update of the International Wood Chip Market
The Importance of Russian Wood Products in Asian markets
European Lumber Exports to the US
Presentations can be viewed on our web site www.woodprices.com or ordered from info@wri-ltd.com

Wood Resource
Quarterly
Sources and Subscription Information
Principal Information Sources

Sawlog market information is obtained from industry sources in the countries covered by the WRQ. In addition,
information is sourced from Ministry of Forests (Canada); Timber-Mart South (US); Pacific Rim Log Market
Report (US Northwest); Forme Consulting Group (New Zealand); STCP Engenharia de Projetos (Brazil); ZMP
(Germany); Metsa (Finland); Skogsstyrelsen (Sweden); Wood Industries Federation of NW Russia (Russia) and
Ministry of Agriculture, Forestry & Fisheries (Japan).
Pulpwood market information is obtained in part from the following regional experts by special agreement with
Wood Resources International:
Norges Skogeierforbund (Norway); Skogsägarna (Sweden); Maataloustuottajain Keskusliitto (Finland); Dr. D.

Bemelmans (France); Union de Selvicultores del Sur de Europa (Spain); Wood Industries Federation of NW
Russia (Russia); “North American Wood Fiber Review” (US, W.Canada); Gauthier, Parent & Asso. (E. Canada);
STCP Engenharia de Projetos (Brazil); Forme Consulting Group (New Zealand); Jaakko Poyry Consulting Pty.
Ltd. (Australia); Pulpwood Division, Japan Paper Association (Japan). Pulp price data used in the Pulp Grade
Wood Fiber Cost Analysis (pages 8 & 9) taken from FOEX Indexes Ltd and from Pulpwatch (Hawkins Wright).
Subscription Information
“Wood Resource Quarterly” is published quarterly by Wood Resources International, LLC. The report is published
in April, July, October and January (2006). The annual subscription rate for 2006 is US$ 2300 (single user option)
and $3800 (multi-user option), which includes both a mailed copy of the report, as well as a down-loadable version
of the report from the Wood Resources International web site (www.woodprices.com).
For more information, or to initiate your subscription, please contact the Bothell office of Wood Resources
International LLC, Phone: +1 425 402 8809, or e-mail at info@WRI-Ltd.com
Disclaimer
Prices published in the Wood Resource Quarterly are collected from sources believed to be reliable and having
a good knowledge of the market place. Prices in the report are the best estimates for the published quarter and
they may vary depending on special agreements and specific conditions.
Wood Resources International LLC has made every effort to ensure accuracy and completeness of information
provided but our company is not responsible for financial losses or damages of any kind resulting from actions
taken based on the contents of this report. We disclaim responsibility for errors that may have occurred when
gathering and publishing data.
International and U.S. Federal Copyright Laws:

• All Wood Resources International LLC (WRI) printed, e-mailed, downloaded or faxed subscriptions, articles,
and reports are protected under U.S. Federal and international copyright laws as proprietary information.
• No part or total of any WRI publication may be reproduced, transmitted or retransmitted in any form, or by
any means, electronic or mechanical, including photocopy, facsimile, or any information storage and retrieval
system, including intranet, without expressly written permission. It is also illegal to share access password
with nonsubscribers.
• Violation of the US copyright law can result in fines of up to US$150,000, plus attorney’s fees (Title 17 USC,
§504).

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Wood Resource

Wood Resource Quarterly - 2Q/2006 Quarterly

The Global Forest Industry This Quarter..................................................................... 3

Major Pulp and Conifer Sawnwood Producing Countries ........................................... 4

A Few Facts About the Global Forest Industry............................................................. 5

Biomass Market Update ............................................................................................. 8

Pulp Market Update ..................................................................................................... 9

Global Delivered Pulpwood Prices .............................................................................. 11

World Pulpwood Price Review by Region ................................................................... 12

Conifer Sawlog Price Indices ....................................................................................... 16

Sawlog and Pulpwood Markets - USA ......................................................................... 18

Sawlog and Pulpwood Markets - Canada .................................................................... 21

Sawlog and Pulpwood Markets - Europe .................................................................... 24

Sawlog and Pulpwood Markets - Northwest Russia.....................................................33

Sawlog and Pulpwood Markets - Asia and Oceania .................................................... 37

Pacific Rim Wood Fiber Trade ......................................................................................... 44

© 2006 Wood Resources International 1

Wood Resource Quarterly

July 26, 2006

Håkan Ekström, Editor-in-Chief

2 © 2006 Wood Resources International

The Global Forest Industry this Quarter

© 2006 Wood Resources International 3

Major Pulp Producing Countries

Top 20 wood-based pulp producing countries in 2004 (million tons):

Major Conifer Sawnwood Producing Countries

Top 20 conifer sawnwood producing countries in 2004 (million m3):

4 © 2006 Wood Resources International

A Few Facts About the Global Forest Industry:

Other Industrial Sawnwood

© 2006 Wood Resources International 5

Forest Resource and Industry Profile - Northwest Russia

Source: ECE/FAO Conifer Non-conifer Total

Log Exports Increased 20% from 2005

6 © 2006 Wood Resources International

Forest Resource and Industry Profile - Northwest Russia

35 Lumber Production in Northwest Russia

NW Russia. Ilim pulp is, by far, the largest manufac- 5

turer of pulp in Russia and it is also the largest ex- 0

ports accounted for 2/3 of Russia’s total pulp exports.

Sawlog Prices Have Doubled in Five Years

© 2006 Wood Resources International 7

Biomass Market Update

Global trade of pellets has also gone up significantly 2000

stantial forest resources being the major destinations. 0

many. Most of the world’s pellet consumption is con-

Canada has Become the Major Pellet Exporter

8 © 2006 Wood Resources International

Pulp Market Update

© 2006 Wood Resources International 9

Wood Resource Quarterly

Average Conifer Price

Average Non-Conifer Price

10 © 2006 Wood Resources International

Global Delivered Pulpwood Prices

Average Delivered Conifer Wood Fiber Prices

Average Delivered Non-Conifer Wood Fiber Prices