Japan Wood Products Prices
1-15th April  2004

Japan Wood Products Prices

Dollar Exchange Rates of  9th April  2004

Japan Yen 106.44 

Tropical Log Market Firms  

Firm FOB log prices have forced up the log market in Japan. Since February arrivals in Japan were modest (around 72,000 Cu.m), and March log price negotiations tended to be bullish, although prices did not move much.  

Importers are saying that FOB log costs are rising so steeply that current wholesale prices in Japan are some yen 400 per koku less than the actual cost of late February prices of about US$143 per Cu.m for Meranti regular. March shipment prices are more than US$150 per Cu.m so by late April and early May, the log cost could be yen 600 per koku higher than current prices.  

Current prices for Sarawak Meranti regular translate to about yen 5,000 yen per koku CIF and are firming. Meranti small is at yen 4,500-4,550 and super small is at yen 4,100-4,150. Both are yen 50 higher than a month ago. PNG's taun/calophyllum is at yen 4,600- 4,700, 50 yen higher.

Japanese plywood mills are resisting higher Sarawak Meranti log prices because they say the market for tropical hardwood plywood is not as good as the market for softwood plywood. Mills are now looking for relatively inexpensive Sabah logs and PNG's quality logs for thin plywood and MLH for medium and thick plywood production.

Log production in SE Asia is reportedly gradually improving despite continuing unstable weather conditions but the export prices remain high because local plywood mills are paying good prices for logs as the market for plywood has improved.

Sarawak Meranti regular FOB prices for Japan are around US$155-156 per Cu.m (SQ up), about US$13 higher compared to prices in late February. Small and super small Meranti prices are also up by US$10.

Shipping companies are under pressure to increase ocean freight rates again because charter rates and bunker oil prices continue to go up. The Japan Lumber Report suggests that freight on Sarawak loadings may go up by about US$2-3 per Cu.m.

February Housing Starts

Total starts in February were 84,950 units, 1.9% higher than the same month a year ago and this represents an increase for three straight months.

For more information on the Japanese market please

see www.n-mokuzai.com

March Wholesale Prices

 Adhesive Prices Climb 

Oshika Corporation of Japan, one of the bigger adhesive manufacturers has raised the prices of its products. Prices of phenol resin are up 10 yen per kilogram and urea and melamine resin are up 7 yen. Honen Corporation also raised the prices of glue used for wood products. Sunbake also raised the prices in March.

The reason for the price increase is because of the higher cost of crude oil, naphtha and methanol, which pushed up he prices of urea, melamine, phenol and formalin.

In particular, demand for phenol monomer is strong in China and the prices the raw materials for it manufacture have jumped. The driving force behind the rise in urea prices is that the supply declined recently because of an accident at a major chemical plant.

Revised Forecasts

Japan's Forest Agency has released new forecasts of supply and demand for imports of wood products up to the 3rd and 4th quarter of this year. In the second half of last year, demand for lumber and building materials surged as there was some improvement in housing starts helped by a deduction in tax rates. This bullish mood slowed a little in the first quarter of this year, but it is anticipated that starts will pick up again starting this month.

Source:ITTO