Japan
Wood Products Prices
Dollar Exchange Rates of 25th
November
2025
Japan Yen 156.00
Reports From Japan
Priority is delivering measures against
rising prices
The Cabinet approved a new economic stimulus package.
The overall scale of the stimulus measures is about
US$135 billion when tax reductions are included with the
primary cut being the abolition of a provisional gasoline
tax. Subsidies for electricity and gas bills will resume.
The package has three pillars: measures to address rising
prices, realising a strong economy and strengthening the
country's defense and diplomatic capabilities.
The government reported in late November that core
inflation excluding volatile food costs was 3% in October,
higher than the Bank of Japan’s target of around 2%.
The Japanese Prime Minister Takaichi Sanae said: "With
this economic stimulus package, the government will
prioritise quickly delivering measures against rising prices.
We will also fund crisis management and growth
initiatives”.
The spending package far exceeds those of the pre-
COVID-19 pandemic years and is also meant partly to
blunt the impact of higher US tariffs on Japanese
exports to America.
After taking office last month the Prime Minister promised
to boost government spending despite concerns that this
will delay progress on trimming Japan’s national debt
which is about triple the size of its economy.
See: https://www3.nhk.or.jp/nhkworld/en/news/20251121_B2/
and
https://apnews.com/article/japan-economy-takaichi-trump-
stimulus-a5b913d98c422540a837397ea8fd676d
Labour shortages should support wage gains
Negative effects of US tariffs say analysts, are highly
likely to emerge going forward. Although the Japan-U.S.
negotiations have resulted in a decision by the US to lower
the tariff rate, the imposition of a still-high 15% tariff
remains unchanged meaning the downward pressure on
the Japanese economy will still be considerable.
At the 2026 spring wage negotiations the pace of wage
hikes is likely to slow versus 2025 due to weaker 2025
earnings but labour shortages should still support some
wage gains. Alongside slower inflation, real wages are
expected to trend moderately higher.
See: https://www.dlri.co.jp/english/report_en/202509YS.html
Growth driven by services sector
Japan's November flash PMI data, released by S&P
Global, shows an expansion in private sector activity with
the Composite Output Index rising to 52.0 from 51.5 in
October, marking the highest level in three months.
This growth was primarily driven by the services sector,
which remained resilient, while the manufacturing sector
continued to contract but at a slower rate.
Inflation is driving up input costs at their fastest pace in
six months so firms continued to increase their selling
prices. That said, an uplift in business confidence to the
highest in ten months hinted at potential improvements in
business conditions in the near-term.
See:
https://www.spglobal.com/marketintelligence/en/mi/research-
analysis/japans-growth-momentum-rises-alongside-
improvement-in-business-confidence-Nov25.html
Household spending holds up despite high inflation
Japan’s household spending rose for a fifth month in
September and this helped support an economy that
analysts say contracted in the third quarter.
Spending by households adjusted for inflation gained
1.8% in September from a year earlier according to the
Ministry of Internal Affairs but this was below the median
economist estimate of a 2.5% rise as there was a decline in
spending on housing and education.
Consumption accounts for more than half of Japan’s GDP.
While spending held up despite high inflation the
economy continued to slow as exports have declined and
housing starts dropped. Consumption is a key indicator to
gauge if households are becoming resilient against the
rising cost of living.
See:
https://www.japantimes.co.jp/business/2025/11/07/economy/sept
ember-household-spending/
Talk of currency intervention against the
rapidly
sliding yen
In late November the yen continued its downward spiral
against the US dollar as confidence failed to return and
negative sentiment grew. The massive stimulus package
announced by the new administration in Japan was behind
the latest yen weakness because new debt has been issued
to, in part, fund the stimulus.
In the second half of November the yen fell toward 158 to
the dollar and discussions on currency intervention were
heating up. The ‘yen sell off’ sentiment paused after a top
finance official warned of currency intervention against
the rapidly sliding yen and the Finance Minister, Satsuki
Katayama, said “the government will take appropriate
action when necessary to address excessive volatility or
disorderly movements in the foreign exchange market”.
Goushi Kataoka, a former Bank of Japan Policy Board
member chosen by Prime Minister Sanae Takaichi to serve
on a new economic growth strategy panel said “the
government’s response to the weaker yen has been too
muted.” Market participants broadly expect the yen’s
downtrend to continue.
See:
https://www.japantimes.co.jp/business/2025/11/19/markets/yen-
160-intervention/
Satellite imagery and AI to find abandoned houses
suitable for sale
Some Japanese companies are using a combination of
satellite imagery and artificial intelligence to help them
find abandoned houses that could be put up for sale, as the
country tries to address the rise in abandoned houses.
Abandoned houses in Japan, known as akiya, are the result
of a declining and aging population, urbanisation and
complex inheritance laws. It is estimated that there are
around 9 million vacant properties in the country. These
houses are often found in rural areas and can be purchased
at a very low cost.
A service provided by a startup uses AI trained on
thousands of photos to identify aging roofs based on
characteristics such as rustiness and colours, signs that the
houses are likely abandoned and could be offered for
renovation.
See: https://english.kyodonews.net/articles/-/65506
Wooden furniture imports
Since June this year the yen has depreciated XX% against the US
dollar, the main currency in the wooden furniture and parts trade.
This has pushed up the cost of imports to an extent that any
underlying trend in core demand has been hidden.
The most obvious trend that has emerged is that while the cost of
imports has steadily risen, the value of imports of wooden
bedroom furniture has dropped sharply, a sign of weak demand.
Wooden office furniture imports (HS940330)
Year on year and month on month the value of Japan’s
imports of wooden office furniture (HS940330) in
September rose but the upswing was modest as shipments
from the main supplier China, were little changed.
In September, four suppliers accounted for over 90% of
imports of wooden office furniture: China (82%), Italy
(7%), Taiwan P.o.C and Turkey (2.5%). The other
significant shippers in September were Viet Nam and
Denmark.
Wooden kitchen furniture imports (HS940340)
As in previous months, Septmber imports of wooden
kitchen furniture (HS940340) were dominated by shippers
in the Philippines (52% of imports) and Viet Nam (27%).
September arrivals from both the Philippines and Viet
Nam recovered from the downturn in August.
The value of September arrivals of HS940340 from China
(6% of the total) was around the same level as in August.
In September there were significant shipments originating
in Germany, Italy and Thailand. Year on year the value of
September wooden kitchen furniture imports rose and an
upward shift was seen compared to a month earlier.
Wooden bedroom furniture imports (HS940350)
After four consecutive months of decline the value of
wooden bedroom furniture imports moved higher in
August but that was not sustained into September. There
was a drop in the value of imports during the second and
third quarters of this year.
Against the backdrop of the weakening yen exchange rate
clearly underlying demand has faltered.
The top two shippers of HS940350 to Japan in September
were China, 63% (59% in August) and Viet Nam 29%
(29% in August). The other top sources of September
imports of wooden bedroom furniture were Thailand and
Italy.
Year on year there was an increase in the value of
September imports but compared to a month earlier
September imports declined.
Wooden furniture parts imports (HS940391)
The value of wooden furniture parts imported into Japan
up to September this year has been remarkably consistent
except for the peak at the beginning of the year.
Shippers in China and Indonesia dominated September
imports with Viet Nam being pushed into third place at
just 14% of the value of September arrivals.
The value of September 2025 imports was up on the level
reported for August and also up on the value reported for
September 2024.
Of the total value of HS940391 imports, 46% was
delivered from China (47% in August), 21% from
Indonesia (20% in August), 14% from Viet Nam (14% in
August). Malaysia, which secured a 6% share of July
imports, was the fourth ranked source in terms of value.
Imports of HS940391 from shippers in Europe accounted
for a small part of September imports, of note was the up
in the value of imports from the US.
Trade news from the Japan Lumber Reports (JLR)
The Japan Lumber Reports (JLR), a subscription trade journal
published every two weeks in English, is generously allowing the
ITTO Tropical Timber Market Report to reproduce news on the
Japanese market precisely as it appears in the JLR. For the
JLR report please see: https://jfpj.jp/japan_lumber_reports/
Plywood
Shipments of domestic softwood plywood have picked up
this autumn, mainly driven by demand from precut
factories. In October, domestic softwood structural
plywood (12 mm, 3×6) was priced at approximately
¥1,100 per sheet (wholesaler delivery) in the Tokyo area,
largely flat compared to the previous month.
Indonesian plywood, including both all-natural wood and
falcata-combination types, remains on a firm pricing trend.
This firm market tone is primarily driven by elevated log
prices resulting from limited log availability. Thin
plywood, which depends on high-grade logs, is
experiencing tight raw material supply.
The quoted origin price for Indonesian ordinary plywood
is approximately US$970 for 2.4 mm thickness (3×6
panel), US$880 for 3.7 mm and US$850 for 5.2 mm—all
on a C&F basis, with lower prices available depending on
the deal.
Compared to last month, prices have held steady:
US$600–610/m³ for painted formwork plywood, US$500–
510 for standard formwork and US$510–520 for
structural plywood (all C&F). For the wood construction
market, domestic painted formwork plywood (12 mm
thick, 3×6 panel) is trading at ¥1,800–¥1,850 per sheet
(delivered), while both standard formwork and
structural grades are approximately ¥1,550.
Prices for standard plywood remain firm, with 2.5 mm at
around ¥780, 4 mm at ¥930 and 5.5 mm at ¥1,100 per
sheet (wholesaler delivery).
Domestic lumber and logs
The market for domestic wood products remains uneven.
As builders accelerated construction during September and
October, precut factories began operating at higher
utilization rates. Among domestic products,
cedar studs are in highest demand, with some mill carrying
a one-month order backlog since September.
Likewise, 90 mm square cedar and cypress are in short
supply, prompting producers to adopt a stronger position
on price increases when dealing with large housing firms.
Prices for KD premium cedar studs (3m × 30 × 105 mm)
remain flat at ¥60,000–¥62,000/m³ (precut plant delivery).
KD Cypress posts (90 mm square × 4 m, premium grade)
are priced at approximately ¥78,000/m³, with cedar of the
same dimensions trading near ¥60,000.
Cedar log prices are rising in northern Kanto and Tohoku,
whereas demand for cypress logs is weakening in western
Japan.
As the logging season begins, nationwide log output is on
the rise. Yet, similar to last year, purchasing interest is
picking up in eastern Japan while waning in the west. In
the latter part of last year, log output did not pick up,
resulting in widespread price increases by year-end. The
plywood segment also began to experience supply
tightness. In many regions, both cedar and Cypress are
trading at higher levels compared to last year, raising
interest in whether the same pattern will emerge again.
Cedar logs for post cutting in Tochigi rose to ¥17,000/m³
(log market delivery), a ¥1,000 increase from last month.
Akita’s medium-diameter logs are up ¥500 at ¥15,500–
¥16,000.
In Kyushu, prices are stable. ¥16,000 for post-cutting logs
and ¥14,500 for medium-diameter logs. Cypress log
prices showed mixed movement. Tochigi’s post-cutting
grade dropped ¥1,500 to ¥19,000/m³, Kyushu’s
foundation-grade fell ¥500 to ¥22,500, while prices in
Chubu and Chugoku stayed flat—with Chugoku
maintaining high levels at ¥24,000 for both post and
foundation grades.
U.S. tariffs on Japanese imports range from 10% to
15%
The import tariffs imposed by U.S. President Donald
Trump on lumber and related products took effect on 14th
October. Imports from Japan to the United
States,including softwood lumber, logs and processed
goods such as sofas and furniture—are subject to tariffs
ranging from 10% to a maximum of 15%.
According to the Forestry Agency, Japan’s wood exports
to the United States totaled approximately ¥5.6 billion in
2024, making it the third-largest export destination after
China and the Philippines.
In particular, exports of Japanese cedar lumber to the
United States totaled approximately ¥2.7 billion,
accounting for about 49% of the overall volume and are
subject to a 10% tariff. In addition, exports of wooden
fittings, bamboo products, softwood edge-glued lumber,
wooden tableware and other items totaled approximately
¥2.9 billion and are now subject to a 15% tariff.
Meanwhile, softwood lumber imported from Canada to
the United States is subject to a 10% tariff and when
combined with existing duties—namely anti-dumping and
countervailing duties—the total average tariff on
Canadian softwood lumber reaches approximately 45%.
Shippers are closely monitoring the situation. As domestic
market prices in the U.S. have not risen to offset the
previous tariff increases, the additional Trump tariffs are
expected to deal a further blow, leading to a series of
temporary closures of lumber mills due to worsening
profitability.
Due to last-minute purchases by buyers ahead of the
increase in anti-dumping and countervailing duties, the
market is now oversupplied. In addition, winter is
typically an off-season for demand in the U.S. and a
recovery is unlikely until spring.
Special Feature -‘Forestry Agency releases survey
results
The Forestry Agency has compiled the results of its fact-
finding survey on price pass-through and fair trade
practices in the forestry and timber industries.
In fiscal 2024, 64% of businesses were able to pass on
either most or part of their cost increases. However, by
industry segment, challenges were particularly evident in
the precut processing and raw material production sectors.
Meanwhile, the survey also revealed persistent issues in
trade practices, such as delayed payments and excessive
price reductions, highlighting the continued presence of
problematic business customs that require improvement.
The fact-finding survey was conducted from late June to
late July, with a total of 776 responses collected.
Responses were categorised into six industry segments,
raw material production, wood processing (including
manufacturing), precut processing, primary wholesale
markets, sales (including trading companies, wholesalers
and retailers) and others and aggregated by business size.
The main reasons cited for price pass-through were raw
material costs, 77%, followed by transportation costs,
62%, labour costs, 61% and energy costs 52%. However,
14% of respondents reported that they were unable to pass
on any of the cost increases. By industry segment, the
highest rate of partial or full cost pass-through was seen in
the sales sector at 84%, while the lowest was in precut
processing at 47%, followed by raw material production
at 50%.
In terms of pricing methods within the industry, 72%
relied on negotiated transactions, while bidding and
buyer-initiated proposals were relatively uncommon.
Among negotiated transactions, 95% involved price
negotiations at the time of setting prices and even during
cost increases, 73% of cases included at least partial
negotiation.
As expected, price negotiations in response to rising costs
were mostly initiated by the receiving (contracted) side.
The most commonly used material during negotiations
was market data, 52%, followed by cases with no
supporting documentation, 32%, indicating that many
businesses entered negotiations without any backup. The
third most common reference was data on rising
manufacturing costs, cited by 29% of respondents.
While 27% of businesses did not engage in price
negotiations during cost increases, the most common
reason—cited by 35%—was the belief that such
negotiations would not be accepted, leading them to
refrain from initiating discussions. The second most
common reason, cited by 23%, was the fear that initiating
negotiations might lead to reduced order volumes or
termination of business relationships.
The Forestry Agency plans to finalise its guidelines on
price negotiations by the end of the year, with a view to
publishing them along with specific case examples.
|
