Lumber, Timber etc.

Re: Lumber

Postby winston » Sat Sep 11, 2010 10:14 am

It has been said that lumber prices cant be manipulated and if lumber goes up, the economy is not doing too bad ...

Lumber Futures Extend Rally To A Three-Month High On Positive Outlook For The U.S. By Mark Perry

BLOOMBERG — “Lumber prices climbed, extending a rally to a three-month high, on signs of optimism in the U.S. economy (see chart above, data here).

“Some reasonably good economic news” gave confidence to lumber buyers, said Hakan Ekstrom, the president of Wood Resources International LLC in Bothell, Washington.”

http://www.dailymarkets.com/economy/201 ... s-economy/
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Re: Lumber

Postby winston » Tue Feb 22, 2011 9:15 pm

The Overlooked Commodity China Can't Get Enough Of By Larsen Kusick

"Virtually every lumber customer we have in the state of Oregon is now cutting for the Chinese market."

That quote comes straight from Rick Holley, CEO of Plum Creek Timber, the biggest timberland owner in the U.S.

The benchmark commodity index (CRB) has been on a tear lately – up more than 33% since last summer. Finding bargains in the commodity space is getting harder. That's why Rick Holley's comment jumped out at me. China has already moved to snap up supplies of natural gas, oil, coal, and even uranium.

Now China is moving into the North American timber market.

According to industry consultant Wood Resources International, U.S. log exports to China went from 256,000 cubic meters (m^3) in 2007 to 2.4 million m^3 in 2010. That's nearly a ten-fold increase in just three years.

Canada is seeing similar growth. British Columbia is Canada's biggest timber-producing province. Take a look at the growth in lumber exports over the last 10 years...

Since 2000, British Columbia's exports to China are up more than 5,800%. And this growth hasn't slowed at all in recent years. Over the past four years, the amount of lumber Canada has exported to China has grown steadily at an annual rate between 78% and 117%. In terms of value in Canadian dollars, exports to China more than doubled in 2010 – the biggest jump in the past 10 years.

The U.S. and Canada can thank Russia for at least part of the increase. In 1997, Russia – China's main lumber source – imposed a tariff on log exports. But China is ramping its lumber imports from ANYONE who has the resources. Despite the tariff, China's lumber imports from Russia rose 40% in 2010. Lumber imports from the U.S. and Canada rose 54% and 65%, respectively.

In 2010, China imported a total of 34.3 million m^3 of logs – up 22% vs. 2009. Lumber imports rose a huge 49% to 14.7 million m^3.

We're seeing such big numbers because China has to turn to the international market for lumber supply. In the late 1950s, untold acres of China's forestland were chopped down to help fuel so-called "backyard steel furnaces." During the 1990s, efforts to expand agricultural production led to more deforestation.

I visited China last summer, and saw firsthand a nation that is still in the early stages of modernizing. Beijing and Shanghai are as modern as European cities, but it could take decades before even half of China catches up to developed nations. That will mean much more building, which will mean much more lumber demand.

(Also, the Financial Times recently noted that Chinese officials are touting the need for more houses to be made out of wood following the 2008 Sichuan earthquake, which killed 68,000 people.)

Limited supply coupled with increasing use of lumber in houses and furniture should ensure China remains a big importer of lumber for decades. And it's not just China. Government data from British Columbia also show exports to India, the Middle East, and southeast Asia hit all-time highs during 2010.

My favorite safe way to benefit from a long-term bull market in lumber is a big, land-rich real estate investment trust like Plum Creek Timber. Shares of Plum Creek haven't been completely left behind by the big commodity rally. They're up about 20% in the past six months. But the 4% dividend and its valuable land assets make it an attractive long-term holding.

Plum Creek and its peers are still in the process of recovering from the effects of the housing collapse. I don't expect a jump in U.S. housing demand soon. But big growth in demand from China will give these companies a decades-long tailwind.

http://www.growthstockwire.com/
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Re: Lumber

Postby winston » Tue Apr 03, 2012 7:44 am

LUMBER PRICES SAY THIS IS A TOP FOR HOUSING STOCKS

Tom McClellan – McClellan Market Report

http://pragcap.com/lumber-prices-say-th ... ing-stocks
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Re: Lumber

Postby winston » Wed Mar 06, 2013 8:48 pm

CAN YOU NAME THE WORLD'S TOP-PERFORMING COMMODITY? by Brian Hunt

Quiz time: Which commodity has performed the best over the past 12 months?

Some might guess natural gas. The clean fuel has enjoyed a heck of a rally off its early 2012 lows. Others might guess corn or soybeans. These agricultural commodities have been all over the news.

The correct answer, according to financial research website Finviz, is lumber. Wood has registered a 47% gain in the past 12 months… beating stocks, grains, energy, and everything else.

You might not have guessed lumber would be the winner. But you can probably guess the driver of its rally… It's the huge rebound in the housing market.

Like most commodities, lumber was hammered during the credit/housing bust of 2008. But as you can see from the chart below, it's been a heck of a recovery. Prices have surged in the past 18 months… and are sitting near eight-year highs. It's a bull market in wood!

Source: www.dailywealth.com
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Re: Lumber

Postby winston » Wed Mar 20, 2013 5:57 am

Could lumber fall 50% in price again? Should stock market investors care? by Chris Kimble

Lumber has traded inside of a channel for the past 20 years.

Each time it has hit the bottom of the channel it has rallied 100% in price. Each time it has hit the top of the channel at (1), it ended up falling 50% in price.

Lumber is now back at the top of this channel, the inset chart (lower left above) reflects a breakdown of a bearish falling wedge.

Lumber is limit down today and sentiment is high, over 82% lumber bulls.

Keep a close eye on lumber, because the prior 50% declines happen to be decent leading indicators for the economy and in turn the stock market/S&P 500 declined!

-
http://blog.kimblechartingsolutions.com ... tors-care/
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Re: Lumber

Postby winston » Fri May 17, 2013 6:20 am

This quality leading indicator is breaking down…correct message again? by Chris Kimble

Lumber has traded within a falling channel for the past 20-years. When lumber has hit the bottom of the channel, stocks have followed to the tune of 100% rallies twice.

The key to this pattern is when Lumber is at the top of the channel and turns down, it seems to pull the economy, stock market and economy lower with it.

The upper left chart reflects Lumber recently was at the top of the falling channel and the upper right chart reflects a breakdown in Lumber.

Lumber as a leading indicator is usually a good bit ahead of the economy and stock market.

Is Lumber sending a macro message about the economy again that investors should respect or will it be different time?

http://blog.kimblechartingsolutions.com ... age-again/
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Re: Lumber

Postby winston » Thu May 30, 2013 6:04 am

Leading indicator is limit down today, losing 25% of its value in 70 days! by Chris Kimble

The Power of the Pattern reflected that a key economic asset could fall 50% in value back on 3/18, due to 20-year channel resistance and 75% bulls. (see post here)

Lumber was trading at $385 at the time, today lumber is limit down trading at $287, losing 25% of its value in 70 days!

The above chart reflects that 100% of the time Lumber hit the top of its trading channel, it has fallen at least 50% in value, over and over for the past 20 years! I doubt that many of you trade lumber and many of you might be saying...."why should I care about Lumber, I don't own it!"

Lets look at lumber a little closer...The bottom of the channel was hit in 1995, 2001 and 2009, not bad times to be looking to buy stocks at low prices. The last serious decline by lumber took place in early 2011. What did the S&P500 do after this lumber decline? SPY declined 17%, peaking in May of 2011.

Lumber is not the "Holy Grail" of stock market indicators, yet often times it has paid to respect it at the top and bottom of this 20-year channel and its message for the stock market!

http://blog.kimblechartingsolutions.com ... n-70-days/
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Re: Lumber

Postby winston » Sat Nov 09, 2013 9:57 am

Housing Stocks To Pop Up Into 2014

Housing industry stocks as a group appear poised to start a strong pop up into early 2014. That's the message from looking at the chart plot of lumber prices.

It was back in 2008 that I discovered that lumber prices give a good model one year ahead of time for what housing stocks should do. I figured that there ought to be some relationship between lumber and housing, and when I put the two series together on a chart it was obvious there was some relationship as expected. But it did not look quite right.

Shifting lumber prices forward on the chart was the key to unlocking the real relationship. The same dance steps that appear in lumber's price movements tend to be traced out about a year later in the prices of housing sector stocks.

http://www.mcoscillator.com/learning_ce ... into_2014/
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Re: Lumber

Postby winston » Fri Jun 05, 2015 8:46 am

2 Timber Stocks to Make Money Grow on Trees

Timber stocks are boring, but boring pays

By Aaron Levitt

Source: InvestorPlace

http://investorplace.com/2015/06/timber ... XDxLdKqqko
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Re: Lumber, Timber etc.

Postby winston » Tue Apr 25, 2017 2:47 pm

U.S. to impose 20% duties on Canadian softwood lumber-Ross

WASHINGTON, April 24 (Reuters) - U.S. Commerce Secretary Wilbur Ross said on Monday his agency will impose new anti-subsidy duties averaging 20 percent on Canadian softwood lumber imports, a move that escalates long-running trade dispute between the two countries.

"There are several different layers of duty each for a different company, but it averages 20 percent," Ross told Reuters by telephone.

"It affects $5 billion worth of lumber coming in from Canada.

It's about 31.5 percent of the total U.S. market, so it's a pretty big deal in terms of the Canadian relationship."

Source: Reuters
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