Issue link: http://palletcentral.uberflip.com/i/1115386
38 PalletCentral • March-April 2019 palletcentral.com production and associated residual production, we expect the softening to continue. But we don't expect the excess supply of chips and wood fuel to inhibit growth in the sector; it is most likely that the additional material will be quickly absorbed by the market. Growth in softwood pulp, composite panels and wood pellets will counterbalance the new supply. Pulp mills especially have flexibility in their supply chains and can easily substitute lower-cost residuals for higher-cost pulpwood. There is an abundance of conifer/softwood wood fiber from surpluses that accumulated during the Great Recession and its aftermath. For the foreseeable future, landowners are likely to see the downside of this market dynamic. The sale of pine sawtimber drives forestland owner returns, and these prices are stuck at all- time lows; even with new lumber demand, excess inventory will limit an upside price correction for years (though intense harvesting and competition for the pine resource will occur in local markets). Sawtimber prices have yet to reflect the uptick in lumber markets, and the substitution of residuals for pulpwood will also put downward pressure on pulpwood pricing. PC MARKETS Changes in the Residual Wood Fiber Market 2004 to 2017 The report on the U.S. wood residuals markets was commissioned by the National Wooden Pallet & Container Association, the U.S. Endowment for Forestry & Communities, and Resources for the Future. Report analyzes data from the U.S. Forest Service, Forest2Market's proprietary database of timber transactions and other scientific research to understand the relationship between the supply and demand of wood residual materials over a 14-year period. Full report may be downloaded at palletcentral.com/ resources – look under "Data and Research." Forest2Market, based in Charlotte, North Carolina, was founded to empower partici- pants in the global forest, wood products, paper products, biochemical and bioener- gy industries to make better decisions by providing analytics, and in-depth supply chain and market expertise. Learn more at forest2market.com.