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Copyright © 2018, Japan Housing News Co., Ltd.

Semi-Monthly ISSN0021-4477

Sunday, June 30, 2019 Volume 60 Number 12

Hot Topic

Timber Statistics compiled by the Ministry of Agriculture, Forestry and Fisheries shows that domestic production of laminated lumber in 2018 was 1,923,000 cubic meters.>> Page 2

Japan Cross Laminated Timber Association’s general meeting

Japan Cross Laminated Timber Association held its regular general meeting for fiscal 2019 on June 3 at Toshi Center Hotel Tokyo. At the event, 163 people out of 341 members were present.

At the outset of the meeting, Koichiro Nakashima, Representative Director of the association, said, “Five years has passed since the foundation of this organization. During the period, JAS regulations have been established, factories have been built, and the number of CLT manufacturing sawmills has grown to eight.” He was glad

that CLT production capacity had increased to over 50,000 cubic meters. He also mentioned that the number of CLT-using buildings was more than 300, and that the material was exported to Taiwan last year. He stressed, “In Europe, CLT production has exceeded the 1,000,000 cubic meter mark, and in the United States, a new factory is about to start production. We would like to turn our attention to overseas and disseminate CLT made from Japanese tree to the world.”

In the business report for fiscal 2018, the following major projects were reported, “Exhibiting at Taipei Building Show in 2018”, “CLT inspection tour in Sweden”, “CLT Idea Contest 2018”, “Activities of 19 working groups”, “Lecture meetings, workshops and observation tours organized 89 times, in which a total of 12,600 people participated”. He presented the association’s business policies for fiscal 2019 as follows: “Support in designing, implementation of training seminars and awareness building activities”, “Technology development focused on the Rationalization of construction methods”, “Business development toward the targets shown in the road Map”. He also announced that the association would make efforts for promotion of CLT through hold ing f o r u m s a n d i d e a contests, and technology development concerning CLT usage.

Japan Lumber JournalSunday, June 30, 2019

:Company:

(Continued on Page 3)

Sumitomo Forestry financial results for FY 2018 and forecasts for FY 2019

Sumitomo Forestry Co., Ltd. held a briefing session on its financial results for the fiscal year ending March 2019 and forecasts for the fiscal year ending March 2020 at its meeting room on the eighth floor of the Keidanren Kaikan on May 13. Also President Akira Ichikawa announced a new medium-term management plan covering 3 years from the fiscal year ending March 2020 to the fiscal year ending March 2022.

As to the settlement for the fiscal yea r end ing March 2019 , t he company announced net sales of 1,308.9 billion yen, ordinary income of 51.4 billion yen, and current net income of 29.2 billion yen. Sales by segment increased to 487.1 billion yen for timber and building materials and to 452.8 billion yen for housing and construction, but the profit margin shrank due to an increase in cost at overseas factories for timber and building materials and larger selling & administration expenses for housing and construction.

The forecasts for the fiscal year ending March 2020 are: net sales of 1,389 billion yen, ordinary income of 57 billion yen, and current net income of 30 billion yen. The sales

system for timber and building materials will be reorganized from product by product to customer by customer, aiming for sales of 503 billion yen. In the housing and construction business, the company will make sure to start and complete the construction of the increased backlog to find sales of 485 billion yen and recovery of the profit.

It is projected that the number of orders for single-family homes to be 8,000 buildings, the number of deliveries 8,100 buildings, and the number of orders for rental houses 209 buildings. As to the overseas sector, its business expansion in the U.S. is expected to contribute to an increase in revenue, but the profit margin is estimated to decline for severer business environments in the U.S. and Australia.

The mid-term business plan 2021’s performance targets are sales of 1,260 billion yen (the new accounting standard is applied, 1,520 billion yen according to the previous standard), ordinary income 85 billion yen (excluding actuarial differences), and current net income 48 billion yen.

In the timber and building material business, the company will deal with more biomass fuel materials and Japanese timber, strengthen sales of products for the non-residential sectors, work on product development and sales promotion by the integrated production and sales system, and aim to increase ordinary income in the overseas distribution and manufacturing business. For hous ing and cons t ruc t ion , the company aims to sell and build 9,000 buildings annually in the custom-built, built-for-sale, and rental home sectors, as well as aiming at sales of 10 billion yen for promotion of wooden constructions and 100 billion yen for remodeling business.

In its overseas housing and real estate business, the company will build a sales system of 10,000 units annually in the U.S. and 3,000 units per year in Australia. In the resource and environmental sector, which is of international interest, the company will strengthen the profitability of its forestry business both at home and abroad, and increase the total renewable energy generation capacity to 300 megawatts.

Statistics on laminated lumber

According to the Timber Statistics recently compiled by the Ministry of Agriculture, Forestry and Fisheries, the domestic production of laminated lumber in 2018 went down 2.4% from the previous year’s result to 1,923,000 cubic meters.

The ministry started including the production of laminated lumber and the like in the timber statistics f r o m 2 0 1 7 . B e f o r e t h a t , t h e Japan Laminated Wood Products Association (JLWPA) kept its own records. It is the first time in three years for the series of records including the ones gathered by the association to find a fall from the previous year’s results.

Among the production in 2018, those for structural use decreased 0.3% to 1,852,000 cubic meters and those other than structures such as fixtures dropped 37.2% to 71,000 cubic meters, showing a remarkable decline in non-structural use.

Among the structural laminated lumber, small-dimension i tems

:Statistics:


:Wholesalers’ View:


(1,000 cubic meters)

Log Lumber Total Log Lumber Total Log Lumber Total2015 2,565 2,340 4,905 2,622 2,350 4,972 231 170 4012016 2,791 2,236 5,026 2,780 2,271 5,052 241 135 3762017 2,605 2,199 4,804 2,663 2,208 4,871 198 126 3242018 2,553 2,066 4,619 2,587 2,062 4,650 167 129 2962019

YTD 878 547 1,424 861 541 1,402Jan. 232 118 349 210 109 319 189 138 327Feb. 175 121 296 192 127 319 172 132 304Mar. 270 147 418 242 138 379 201 141 342Apr. 201 161 362 218 167 385 184 135 319MayJuneJulyAug.Sept.Oct.Nov.Dec.

Supply/Demand of American Timber

Import Consumption Stocks

increased 11% to 1,041,000 cubic meters, medium dimension decreased 9.4% to 784,000 cubic meters, and large dimension dropped 51% to 27,000 cubic meters. In recent years, the use of small to medium dimension laminated lumber has increased as a structural material for general houses in place of solid lumber. The small-dimension items, which are at low costs, are used more due to the progress of technologies.

Large-dimension items are mainly used for middle- to large-scale buildings, and many of them are expensive custom-made products. The production of large-dimension items has not grown lately, as more technologies and methods have emerged to construct medium- and large-scale buildings at reduced costs through jointing generally-distributed materials and some other ideas. Under such circumstances, JLWPA is making efforts to promote large-dimension laminated lumber through standardization for cost reduction. The “Survey of buildings using structural large-dimension laminated lumber in fiscal 2017” asking the association members showed that the number of buildings has been on the rise mainly among non-residential faci l i t ies . So the trend is paid attention to in the future.

The amount of lamina used for laminated lumber in 2018 was 2,691,000 cubic meters, down 2.3% from the previous year ’s result, among which Japanese wood was 1,051,000 cubic meters, an increase of 15.7%, and imported wood was 1.64 million cubic meters, down 11.2%. The domestic timber ratio was 39.1%, rising 6.1% from the previous year’s result. The use of Japanese timber has increased mainly due to a rise in price of imported lamina from Europe, its deteriorated quality, and increased production of Japanese cedar small-dimension posts.

According to trade statistics by the Ministry of Finance, Japan’s import of laminated lumber in 2018 was 918,000 cubic meters, a 5.2% decrease from the previous year’s record, of which structural items declined 6.3% to 813,000 cubic meters.

American timber market in June

The meeting of the Keihin chapter of the Japan North American Lumber Conference for June was held in Shinkiba, Tokyo, on June 12. As for North American lumber, the situation in producing areas remains chaotic, and product prices are controlled by an anticipation of lower prices. Prices of products for Japan in the third quarter are expected to decline, and there is no element that motivates people to make purchases in Japan at present. As for the increase in the

consumption tax that is scheduled to take place in October, there is no marked rush demand. While the movement of products remains at a certain level, the mood in the market of timber products including European lumber and domestic lumber is becoming increasingly bearish.

As for the situation in producing areas of North American lumber, sawmil ls in Canada are t rying to maintain a market balance by reducing the supply and fight against the decline in product prices. A major SPF lumber manufacturer, “Canfor”, announced that it would cut the production by 500,000 cubic meters, which gave a certain level of impact on the market. However, the increase in product prices has not wiped out manufacturers’ deficits yet. If the government decides to increase stumpage fees (logs) in future, manufacturers will be forced to try to increase product prices further.

In the U.S., the price of Douglas fir logs for Chugoku Mokuzai declined by 10 dollars, but the price seems to

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(1,000 yen / cubic meter)

Feb Mar Apr May JuneLogs

RC No.3, 12"up (Alaska) 50.40 50.40 50.40 50.40 50.40YC pole, 6"up (Alaska) 43.20 43.20 43.20 43.20 43.20Sp No.2, 24"up (Alaska) 104.40 104.40 104.40 104.40 104.40Hem No.3, 12"up, Cascade 24.48 24.48 24.48 24.48 24.48Hem No.3, 12"up, Coast 24.12 24.12 24.12 24.12 24.12Hem, medium dia. 8/11 (J-sort) 23.04 23.04 23.04 23.04 23.04DF No.3, 12"up, Cascade 37.44 37.44 37.44 37.44 37.44DF No.3, 12"up, SS 28.08 28.08 28.08 28.08 28.08DF No.3, 12"up, Coast 27.00 27.00 27.00 27.00 27.00DF, medium dia. 8/11 (J-sort) 25.20 25.20 25.20 25.20 25.20

Wholesale Price of American Logs in Keihin Ports

2019

(1,000 yen / cubic meter)

Hem 105mm sq., roof beam, std 55 55 55 55 55Hem 105mm sq., roof beam, KD 58 58 58 58 58Hem 90mm sq., purlin, std. 55 55 55 55 55Hem 90mm sq., purlin, KD. 58 58 58 58 58Hem 45 x 90mm, batten products, KD 63 63 63 63 63DF 105mm sq., roof beam, Green 55 55 55 55 55DF 105mm sq., roof beam, KD 69 69 69 69 69DF 90mm sq., purlin, Green 55 55 55 55 55DF 90mm sq., purlin, KD 69 69 69 69 69DF 45 x 90mm, batten products, KD 68 68 68 68 68DF 45 x 60mm, batten products, KD 69 69 69 69 69YC 4-5/16" rough, HC 64 64 64 64 64YC 5" rough, HC 64 64 64 64 64YC 5"x 6", random length, BC Clear 160 160 160 160 160Spruce 8-3/4" Clear 240 240 240 240 240Hem 6-1/2" Clear 130 130 130 130 130Nordic 3m x 27 x 105, stud, KD 61 61 61 61 59

Wholesale Price of American Lumber in Keihin Ports

2019

(Unit: cubic meter)Arrival Shipment Ending Inventory Inventory Rate

Monthly Results in AprilSmall Square Lumber

Hem 4-1/8" 1,877 3,129 6,008 2.27Hem 3-9/16" 2,418 4,225 10,154 3.03sub total 4,295 7,354 16,162 2.69

Other Lumber ProductsHemlock 1,810 2,178 5,518 2.54Douglas Fir, SS 8,306 9,022 11,366 1.41Douglas Fir 4,903 5,020 9,193 1.90Yellow Cedar 1,283 1,144 5,375 5.02Spruce 309 420 1,243 1.89SPF 38,443 39,099 8,213 0.25

60,895 65,873 60,211 1.03 Inventory rate: Ending Inventory / Average shipments for the last 3 monthsOverall Softwood Lumber

Movement of American Lumber in Keihin Ports

finally reach bottom. It is true that the trade war against China slowed down the log export, but according to a participant, logs can be sold depending on how they are priced. The pace of the arrival of Douglas fir products for Japan is expected to be back to normal in August and after.

The movement of products in Japan has been sluggish since the end of the Golden Week in May. The operation at precut factories is not that active, either. As the product prices of Chugoku Mokuzai are weakening, prices of many timber products including laminated lumber and European lumber are weakening. The prices of Douglas fir products are currently unchanged but are expected to decline in future. Inquiries for hemlock products, mainly battens, started coming in, and the movement of products is recovering slightly. As for prices in June, prices of all of hemlock and Douglas fir items were unchanged from the previous month. As for the indications, while the indication of hemlock KD 105 square held weakly, indications of all other items held from the previous month. Prices of yellow cedar products and clear were also unchanged. As for the indications, only the indication of spruce held bullish. The price of Nordic stud that is evaluated as a reference item was down by 2,000 yen per cubic meter with its indication holding weakly. The price declined due to the increase in the arrival.

As for the price of Douglas fir logs for Japan, the price of products for major sawmills declined slightly in June. The conditions in the log market in the U.S. are slightly weakening. This month, there was an arrival of 8,000 cubic meters of Alaskan logs in Nagoya. The logs received are already sold out. As


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for domestic log prices in June, prices of hemlock, Douglas fir, red cedar, yellow cedar and spruce were unchanged. As for indications, the indication of hemlock held weakly while indications of other logs held from the previous month.

In April, the arrival and shipment at Kashima Port that supplies logs for Kashima Factory of Chugoku Mokuzai were at the high level as it was in the previous month, standing at 79,763 cubic meters.

:Wholesalers’ View:Tokyo wholesale market in June

“The Opera t ion ra te a t precut factories in May was low. This is due to the delay in work at construction site, and factories are struggling to find places to store the products that are not able to be shipped.” At the Lumber Price Market Investigation C o m m i t t e e o f To k y o L u m b e r

Wholesalers’ Association which was held on June 6, a person involved in precut reported that the delay in work at site is getting worse. Shortage of workers became more severe, and has affected various sectors. On the other hand, orders for factories have recovered, and particularly the factories that handle lumber used in wooden frame metal joint construction method have increased orders.

As for Japanese timber, logging of both cedar and cypress logs increased, and the supply of products increased as well. The price was bearishly holding. For imported timber, the arrivals of Russian red pine products have been low, and the indicative price increased again this month by 1,000 yen per cubic meter. For plywood, the price of imported plywood whose movement has been sluggish decreased: the price of 2.3mm thin plywood, plywood for concrete form and structural plywood decreased by 10-30 yen per sheet.

<Japanese timber>The movement of Akita timber was slow after the consecutive holidays.

The demand for smal l - lo t has increased. The supply of cedar wood batten products has increased. The export of logs for China decreased, so the price slightly decreased. The reason for decline in export for China is attributed to the stoppage of cedar fencing export from China to the U.S. The movement of Tokai timber was flat, but there was a feeling of shortage for wood batten products. There were a number of inquiries for the lumber used for board fences. The products with Yoshino timber in standard sizes are not selling well, but custom sized products were used for large buildings.

As for domestic structural lumber of any origin, which circulated in the metropolitan area, the supply of products increased after consecutive hol idays in May. The pr ice of products was bearishly holding. The harvests of both cedar and cypress logs increased, and the price became weak. The movement of products in precut factories has improved in June.

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(lumber & logs 1,000 yen / cbm; plywood 1,000 yen / sheet; Akita kowari, D,CF&Cleat 1,000 yen / piece)

item grade MayJRC-Akita, narrow width board for rail special 1st 55 55 holdingJRC-Akita kowari (plank) Air-Dried 0.24 0.24 "JRC-Tokai, baby square (4m, 10.5cm x 10.5cm) KD planed special 1st 68 68 "JRC-Tokai, baby square (6m, 12.0cm x 12.0cm) 170 170 "JRC-Tokai, batten products (4m, 10.5cm x 3.0cm) KD planed special 1st 68 68 "JRC-Tokai, batten products (3m, 10.5cm x 3.0cm) KD planed special 1st 65 65 "*JRC, baby square for post (3m, 10.5cm x 10.5cm) KD 65 65 "*JC, baby square for post (3m, 10.5cm x 10.5cm) KD 85 85 "*JC, baby square for sill (4m, 10.5cm x 10.5cm) KD 85 85 "*JC, baby square for sill (4m, 12.0cm x 12.0cm) KD 82 82 "Ash, plain board (thickness 3.4cm) dried, special 360.0 360.0 "Spruce, flitch (length 8-3/4cm) Select Merch 98 98 "DF, beam, KD (home sawn) 73 73 "DF, laminated beam (imported) 125 125 "Redwood, laminated beam (imported) 82 82 "JRC&DF, hybrid laminated beam 79 79 "SPF, D (2x4) J-Grade, No.2 1.06 1.06 "SPF, D (2x10) J-Grade, No.2 3.04 3.04 "DF, D (2x10) J-Grade, No.2 3.35 3.35 "Hem, baby square (imported, 4m, 10.5cm x 10.5cm) KD (S4S) 60 60 "Hem, batten products (imported, 4m, 4.5cm x 6.0cm) KD (S4S) 61 61 "DF, baby square (imported, 4m, 10.5cm x 10.5cm) KD (S4S) 66 66 "DF, batten products (imported, 4m, 4.5cm x 6.0cm) KD (S4S) 67 67 "Hem, treated sill special 1st 70 70 "DF, treated sill KD special 1st 90 90 "Red Pine plank (imported, 4m, 3.0cm x 4.0cm) KD 81 82 strongerRed Pine plank (imported, 4m, 4.5cm x 4.5cm) 1st 65 65 holdingRed Pine cleat (imported, 4m, 2.4cm x 4.8cm) 1st&2nd 0.26 0.26 "Whitewood, stud (mabashira, imported) KD, pithless 66 66 "Whitewood, kudabashira (CP) 5-ply 2.25 2.25 "WS (imported, 3.7m, 2.4cm x 15.0cm) 1st, treated 230 230 "Serangan Batu (imported, 4m, 3.0cm x 10.5cm) 310 310 "Mercusi Pine, laminated board A-grade 145 145 "Red Pine, laminated board A-grade 135 135 "Lauan plywood, F☆☆☆☆ (thickness 2.3mm, imported) 1st 0.69 0.68 weakerCF plywood, F☆ (imported) JAS (A) 1.52 1.50 "Coated CF plywood (imported) JAS (A) 1.62 1.62 holdingLauan structural plywood, F☆☆☆☆ (imported) JAS 1.55 1.53 weakerSoftwood structural plywood, F☆☆☆☆ (12mm) JAS 1.22 1.22 holdingSoftwood structural plywood, F☆☆☆☆ (24mm) JAS 2.57 2.57 "Softwood structural plywood, F☆☆☆☆ (9mm) JAS 2.08 2.08 "JRC=Japanese Red Cedar, JC=Japanese Cypress, DF=Douglas Fir, Hem=Hemlock, YC=Yellow Cedar, WS=White Seraya, CP=connective post, D=dimension lumber, CF=concrete form* Structural lumber made from domestic wood ( producing areas are not specified) mainly sold in metropolitan areas.

Wholesalers' Market Prices in Kiba, Tokyo

June2019

<’hirakaku’ and dimension lumber>Among ‘hirakaku’, the movement of both Douglas fir KD and European red pine laminated lumber was sluggish. Although the sales price remained unchanged, the purchase price could fall further. The price o f SPF d imens ion lumber fo r

Japan decreased as manufacturers in producing area carried much inventories. Purchase price in May decreased by 2,000 yen per cubic meter. If the purchase price in June decreases, the sales prices by wholesalers could also decrease.

<Hardwood>Wholesalers had poor sales in May. As sales were low, inventory has increased.

<Imported timber>The royalty increased in producing areas and there were no harvest of

spruce logs. Output of logs is not expected for the moment, In Japan, there are signs of recovery in demand for lumber for non-residential buildings. The price of Douglas fir clear board has remained high in the d o m e s t i c m a r k e t . Arrivals of hem clear board were low and t h e m o v e m e n t o f products was slow.

A s f o r N o r t h A m e r i c a n l u m b e r products, arrivals of hemlock products f r o m C a n a d a a n d Douglas fir products were low. The price o f l ogs i nc reased in Canada and the p r i ce o f p roduc t s increased as well. In the U.S., the price of Douglas fir logs has been stable at high levels. In Japan, the movement of Douglas fir products seemed to be slow in precut factories. Demand for hemlock wood batten products seemed to decrease.

A s f o r R u s s i a n lumber, there were little red pine logs in producing area, which are raw materials of



:Statistics:

products for Japan, and the arrivals of products decreased. The price has been on rise. Arrivals of mid-grade products could increase. Particularly 3m ceiling joists were low in supply, and people were not able to purchase those products. Arrivals of European lumber in every size increased, and a feeling of shortage has resolved. There were plenty of 3m and 4m stud, and the price remained unchanged. The price of whitewood connective post also remained unchanged.

As for Southsea lumber products, there were no arrival of white seraya in May. Limited inventory was allocated to the orders. Inquiries for selangan batu increased, but the movement of products was slow. The price remained unchanged. The price of mercusi pine laminated lumber has increased in producing area, but people stuck to hand-to-mouth buying in Japan. The movement of Chinese red pine laminated lumber was slow and the price remained unchanged.

<Plywood>The domestic softwood plywood market has been led by manufacturers. S o m e m a j o r manufacturers announced that they will increase the prices of products by 5-8 percent in June due to an increase of shipping cost and high price of logs that is raw material of products. Although there is doubt whether the market accept the price increase, shipments have remained

stable even in lackluster market, and inventories have remained at low levels.

The cost push of imported plywood is higher than that of domestic plywood, and the market has shown no sign of recovery. Inventory at port has been full, and the issues about waiting ships anchoring offshore and late arrival into port have not resolved yet. The arrivals during January to April reached to 94% of the previous year, but it is likely to take time for trading companies to get out of severe condition.

<Precut>The operation rate at precut factories had been low in May. This is due to a delay in work at construction site because of the shortage of workers, and factories were not

European Timber News

The arrival of European softwood lumber products in April was 234,630 cubic meters, up by 23.1% from the

unit : cubic meter; %Total FINLAND AUSTRIA ROMANIA ESTONIA others

2019 YTD 242,783 103,107 39,064 55,399 20,494 24,719APR 59,740 22,086 11,983 13,438 5,148 7,085MAYJUNY/Y -8.7 -32.5 17.3 34.7 2.3 -5.1

Imports of European Laminated Lumber by Countries

unit : cubic meter; %

Total SWEDEN FINLAND AUSTRIA ROMANIA LATVIA CZECH others2019 YTD 853,173 255,191 303,006 101,314 68,790 38,753 31,462 54,657

APR 234,630 72,012 73,579 29,842 18,840 11,594 10,974 17,789MAYJUNY/Y 14.3 20.1 -2.4 13.1 39.4 66.0 3.0 43.4

Softwood Lumber

Imports of European Lumber by Countries

unit : Yen per cubic meter (CIF Japan ports); %

All Europe SWEDEN FINLAND AUSTRIA ROMANIA All Europe FINLAND AUSTRIA ROMANIA ESTONIA2019 APR 35,894 33,769 32,852 40,507 41,302 50,026 50,758 48,795 49,912 50,203

MAYJUNY/Y -2.1 -5.7 -4.3 2.6 6.2 -7.9 -10.0 -5.1 -1.1 -7.0

Softwood Lumber Structural Laminated Lumber

Average Import Value for Major European Commodities

able to ship their products that have completed the processing process from their factories. Major housing manufacturers and builders captured rush demand, and orders for precut factories increased. In particular, the work at factories that handle lumber used in wooden frame metal joint construction method has increased.


Plywood market 3rd week June

As for the domestic softwood plywood for structural use, in May, manufacturers announced that they would increase prices. However, there was no noticeable reaction from a general distribution route, and the lackluster conditions remain. The movement of products does not seem to have gone through exceptional changes. However, manufacturers’ inventory is at the low level overall, and in some cases, delivery of certain items requires a week or more. As the proportion of the direct distribution route is increasing in the plywood supply, caution is required for the product delivery through the general distribution route.

As for product prices, there is no more talk of sale at low prices, but there has been no change in the market prices that serve as a base yet. In July and after, heavy users who make purchases directly from plywood manufacturers will decide prices, and the result will change the situation significantly. However, at present, as there is a difference between eastern manufacturers and western manufacturers in terms of the environment, prices remain unchanged.

As for the imported plywood, the movement of products remains slow, and customers keep making spot purchases. Some of trading companies that ran out of patience are currently presenting prices that differ from market prices, and this trend is spreading in regional areas as well. In future, there is a strong possibility that the purchase by distributors will get more difficult and customers will become more motivated to make spot purchases as a result. Some of items are out of stock, but that is not causing any serious issue at present.

previous month and up by 14.3% from the same month in the previous year. It was at the highest level since June last year. The arrival by country was 73,579 cubic meters from Finland (down by 2.4% from the same month in the previous year) and 72,012 cubic meters from Sweden (up by 20.1% from the same month in the previous year). The arrival from all the countries including 2 major countries was large. The increase in the supply has already started affecting the market.

The arrival of laminated lumber in April was 59,740 cubic meters, up by 3.6% from the previous month and down by 8.7% from the same month in the previous year. As for the arrival by country, the arrival from Finland was 22,086 cubic meters while the arrival from Romania was 13,438 cubic meters. The arrival from Austria and Estonia was 11,983

cubic meters and 5,148 cubic meters respectively while the arrival from others was 7,085 cubic meters. The arrival from Finland was rather low as it was in the previous month. The arrival from Romania has been steady.

The price of all European lumber products (CIF Port Japan) in April was 35,894 yen per cubic meter, down by 2.1% from 36,651 yen in the previous month. It was also down by 2.1% from the same month in the previous year and became low for the first time in a long time. As for the price by major country, the prices of products from Romania and Austria were 41,302 yen and 40,507 yen respectively while the prices of products from Sweden and Finland were 33,769 yen and 32,852 yen respectively. Compared to the previous year, the prices of products from Romania and Austria increased

while the prices of products from Sweden and Finland declined.

The price of laminated lumber for the structural use was 50,026 yen per cubic meter, unchanged for 3 consecutive months. It was down by 7.9% from the same month in the previous year. As for the price by major country, the prices of products from Finland and Estonia were 50,758 yen and 50,203 yen respectively while the prices of products from Romania and Austria were 49,912 yen and 48,795 yen respectively. The prices of products from all the countries declined from the previous year. The price of products from Finland declined by 10.0%, which stands out.



News in Brief

:Statistics:Russian Timber News

The arrivals of Russian logs in April 2019 were 8,946 cubic meters of larch, 5,600 cubic meters of pine, 787 cubic meters of spruce/fir and 210 cubic meters of hardwood with all kinds of arrivals for the first time since February. The amount of arrivals of larch which is the main material decreased by 7.1% from the previous year. As the price rises, trend in demand could raise concern.

As for lumber products, the amount of arrivals of pine and fir as the main products recovered to 76,327 cubic meters increasing 6.9% from the previous month and 17.3% from the previous year. The shortage of redwood bat ten products in the market has been apparent and

shift to alternative is conspicuous. Distributors point out the market contraction but the amount of arrivals in April was the highest since May last year. The amount of arrivals of larch was 3,168 cubic meters.

The amount of arrivals of laminated lumber for the structural use in April was 6,001 cubic meters increasing 44.9% from the previous month and 19.3% from the previous year. The amount of arrivals recovered to 6,000 cubic meter level, but more stable arrivals are expected in the future.

As for log prices (CIF Japan Port) in April, larch was 20,692 yen per cubic meter increasing 1.1% from the previous month and 9.9% from the previous year, pine was 21,361 yen per cubic meter (0.4% increase from the previous month and 9.6% increase from the previous year),

spruce/fir was 18,103 yen per cubic meter and hardwood oak was 159,870 yen per cubic meter (55.6% increase from the previous month and 18.2% increase from the previous year). The price of larch had been gradually rising and marked the highest level.

As for lumber products, the price of larch was 30,041 yen per cubic meter and pine and fir was 39,699 yen per cubic meter (0.9 % decrease from the previous month and 4.0% increase from the previous year). The price of pine and fir has stayed at high level since late last year.

The price of laminated lumber for the structural use returned to the level seen a year ago to 46,967 yen per cubic meter increasing 3.3% from the previous month and decreasing 0.2% from the previous year.

The Real Estate Economic Institute Co., Ltd. recently announced the results of a survey regarding the condominium market trends for April in the Tokyo Metropolitan area. In April, the number of new condominiums put up for sale was 1,421 units (39.3 % decrease compared to the same month last year and 57.4% decrease compared to the previous month) decreasing for the 4th consecutive month compared to the same month in the previous year. The amount greatly fell below the institute’s initial forecast of 2,500 units. In April with the lowest levels in about 30 years since the bursting of the economic bubble, the institute saw companies postponing sales due to the time period of being in the low point between the end of the year and the summer months when demand increases. The movement of giving priority to selling inventories, which are at high levels, is continuing. In contrast to the number of new condominiums put up for sale, the number of completed contracts was 914 units, and the percentage of completed contracts was 64.3% falling below the good condition of 70% for the first time in 2 months. The price per unit was 58.95 million yen (3% increase compared to the same month last year and 10% decrease compared to the previous month), and because the number of units sold in the 23 wards of Tokyo decreased, the price fell 6.57 million yen compared to the previous month. The amount of inventories at the end of April was 7,748 units decreasing by 519 units compared to the end of the previous month. The number of units put up for sale in May is forecasted to be about 2,500 units (2,462 units in the same month last year).

The Japan Housing Finance Agency recently announced the survey results of “Housing Market Trends in Fiscal 2019”. The survey targeted housing businesses (number of responses: 750), general consumers (number of responses: 1,100), and financial planners (number of responses: 59), and the survey was carried out in February and March of this year. When housing businesses were asked about the “outlook for orders received and sales in fiscal 2019 (April 2019 to March 2020)”, the responses showed “forecast of increase compared to fiscal 2018” with 48.4%, “about the same”



with 35%, and “decrease” with 16.6%. When general consumers were asked “Is fiscal 2019 the time to buy a home?” the responses showed “I think it’s time to buy” with 53.4% and “I can’t say either way” with 38.1%. When financial planners were asked whether fiscal 2019 is the time to buy a home, the responses showed “time to buy” with 45.8%, “not the time to buy” with 11.9%, and “I can’t say either way” with 42.4%, and “time to buy” fell 18.7 points compared to the previous year while “I can’t say either way” rose 15 points.

The Japan Plywood Manufacturers’ Association held its regular general meeting and board of directors’ meeting on May 22 in Tokyo. After the meetings, a press conference was held, and Atsuhiro Inoue, the chairman of the association, and 4 vice-chairmen spoke about the activities for the business year and answered various questions from the industry press. At the start, Chairman Inoue said, “The government is hoping to use 6.0 million cubic meters of domestic logs for plywood and LVL aiming for a self-sufficiency rate of 50% with a target of 2025. This year, new factories in Yamanashi and Oita are scheduled to start operations soon and will work further to expand demand in the three areas of structural plywood, flooring boards, and plywood for molding.” Domestic plywood factories have been established in Mie, Shizuoka, and Iwate in recent years and have continued with smooth operations. 100,000 m³ of logs per month are consumed by each line, and they have a capacity to supply about 300,000 boards. Chairman Inoue said that he is thinking about making plywood with a thickness of 50 mm or more in addition to 9-12 mm structural plywood and 24-28 mm thick plywood, The development of very thick plywood of 50 mm or more is moving ahead mainly by the technological development committee and the ultra-thick plywood development working group of the association, and it is expected to be used in place of concrete and iron.

Within the JK Holdings Group, KEYTEC Co., Ltd., which manufactures and sells plywood and LVL, has recently constructed a new plywood factory in Minobu Town, Yamanashi Prefecture. On May 13, the first shipments of plywood that used local lumber material were made. The new factory was constructed on about 74,000 m² of the site of a former automobile parts factory and was equipped with the

latest plywood manufacturing line. The new factory acquired the JAS certification for structural plywood on April 19 and plans to manufacture about 68,000 m³ of structural plywood annually. For now, the factory will produce 12, 24, and 28 mm thick plywood with a 3x6 size format. The material to be used will be 100% domestic lumber, and about half of the 120,000 m² of the annual wood consumption will be procured from Yamanashi Prefecture with the remaining being procured from neighboring prefectures. The new factory is the first plywood factory to use domestic wood material in the Koshinetsu region, and it employs over 30 people from the local area, and local governments are expected to play a role in the revitalization of the area. Kouichi Nakanishi, the president of Key-Tec, said, “We would like to make a factory that can contribute to the local people who are rooted in the local area.”

On May 24, R. C. Core Co., Ltd. held a meeting to announce its financial results for the fiscal year ending in March 2019 at its head office in Shibuya, Tokyo. For the term ending in March 2019, the number of contracted buildings was 1,083, the value of the contracts reached 16.169 bullion yen, an increase of 19% compared to the previous term, The contracts and order backlogs recorded their highest ever, but sales stalled at 12.397 billion yen (92%), and operating profits fell to minus 635 million yen becoming the first deficit since posting results. Factors for the decline



in profits were: 1) difficulties in procuring Canadian wood material, 2) difficulties in the operations of large-scale sales companies, and 3) prior investments. Concerning difficulties in procuring Canadian wood material, disruptions in the production of lumber products and delays in delivery occurred in Canada, so the construction and hand-over of log houses, which were ordered, were significantly delayed. In the near future, the company will strengthen its production system of framework components by substituting the wood material for domestic wood material and will respond to the increase in orders. Kozo Futagi, the president of the company, said, “We are aiming for orders of 8 buildings per sales person annually while increasing the number of empathetic fans, and for the 3 year mid-term plan, we would like to reach sales of 20.0 billion yen and operating profits of 8% (target value) for the fiscal year ending in March 2020.”

The Japan Wood Protection Association held its general meeting for fiscal 2019 on May 28 in Tokyo. At the meting following the greetings speech by Masahiro Samejima, the chairman of the association, the business report for fiscal 2018, approval of the financial results for fiscal 2018, and election of officers took place, and proposals for the business plan and budget report for fiscal 2019 were discussed and ended smoothly. Reappointed as chairman, Masahiro Samejima reported that the association’s activities including financial aspects have been progressing in a healthy state, and he strongly stated, “There is a chance to let people know about the facilities that will be used in the Tokyo Olympic that will be held in 2020, the Meeting of the International Research Group on Wood Protection that will be held in Numazu City in 2021, and wood preservation.” The 52nd Meeting of the International Research Group on Wood Protection in Japan will be held from May 9 to 13, 2021 at Plaza Verde in front of JR Numazu Station in Shizuoka Prefecture, and people from around the world involved in wood preservation many will attend. At the 50th meeting that was held in Quebec, Canada, many researchers from Japan participated and made their presence known with high level presentations.

Aeon Co., Ltd. started selling a series of 24 environmentally friendly items including “My Bag”, a shopping bag that is made from recycled materials, and simple tableware that that is made from paper and lumber in order to reduce the use of plastics at about 510 Aeon retail stores across Japan. The company is expanding its lineup of environmentally friendly products by taking two approaches: 1) reduce the use of disposable plastic materials and 2) protect forest resources by using sustainable materials. In order to reduce the use of disposable plastic materials, the company will sell “My Bag” and shopping bags that are made from recyclable materials and paper straws, forks, and spoons that are made from plastic substitutes. In order to protect forest resources, the company will sell paper products such as toilet paper that is made from bamboo pulp as a substitute for wood pulp and paper plates and cups that are made from FSC certified wood and paper materials gathered from properly managed forests. In the future, the company will continue to implement various measures to shift from a disposable society to a sustainable society.

On May 23 at the Canadian Embassy, the Japan Office of BC Wood held an explanatory meeting for the 16th Annual Global Buyers Mission (GBM), an international trade show, and observation tour. The tour plan combines the trade show GBM, which will be held from September 11 to 13 in Whistler, Canada, and the observation tour, which consists of 3 courses: observation of Mass Timber Construction (large scale wood construction), observation of forest products of Alberta, and observation of lumber and value-added products from British Columbia. For the Mass Timber Construction tour, various construction examples that effectively use CLT, DIT, and LVL in British Columbia Prefecture


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that permits wood construction of up to 12 stories will be viewed. Participants will directly hear from the designers and engineers who were in charge of the construction at the site. The tour of forest products from Alberta will view factories that manufacture high quality SPF products, OSB, plywood, and structural laminated lumber that is greatly imported by Japan. The tour of lumber and value-added products from British Columbia will tour factories that handle western red cedar, hemlock, and Douglas fir and factories that conduct 2nd stage processing of decks and panels. The tour is also scheduled to observe a storage area for SPF products.

The Japan Wooden Housing Industry Association, commonly known as Mokujukyo, held its general meeting on May 30 in Tokyo. At the press conference, Akira Ichikawa, the chairman of the association, said, “The association would like to conduct activities that make use of the possibility of wood and groups of people that make homes with wood materials,” and he expressed a strong desire for the “utilization of lumber” that is suddenly attracting attention because of sustainable development goals. The new officers’ appointments were announced: Akira Ichikawa (president of Sumitomo Forestry Co., Ltd.) as chairman, Kojiro Nakauchi (representative director of Polus-Tec Co., Ltd.), Shoji Wakiyama (president of North Pacific Inc.), and Masanori Okuda (CEO of Daiken Corporation) as vice-chairmen, and Koichi Koshiumi as managing director. They will steer the association for the next 2 years. Important items in the business plan were given as: “aiming to improve member services while revitalizing the activities of the association by strengthening and enhancing cooperation among the head office and branch offices and promoting the establishment of branch offices where there are no branches” and “planning the establishment of a supply system of wood constructed, temporary emergency shelters while moving ahead with the completion of disaster agreements with prefecture governments and aiming to strengthen contributions to local areas.” As of March 31, 2019, the association has 622 company members, a significant increase of 51 companies from the previous year.

The Ministry of Economy, Trade and Industry solidified its intention to end the “Feed-In Tariff Program”, a fixed price purchase program for renewable energy. The move responds to the increase in the burden placed on consumers due to the increase in “charges” that are collected on normal electricity charges. With an unchanged view of promoting renewable energy, the ministry will work to make a system that increases renewable energy and reduces the burden on consumers in the near future and to revise a related law in fiscal 2020. By introducing a purchasing price bidding system for solar power generated by businesses, a system that promotes competition among power suppliers is expected to be established. The “Feed-In Tariff Program” started in 2012 and contributed to the increase in solar generated power. The use of lumber scraps, waste wood from construction sites, and unused wood material by wood biomass power generation plants is moving ahead, but anxiety is also arising concerning the shortage of logs and increase in prices due to the increase in energy use and the drop in momentum in the expansion of the cascade method of energy use.

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