Increased Rainfall, Possible El Nino Return Brighten Near-Term Timber Market Prospects

Increased rainfall across much of the drought-stricken Southeast and Mid-South has brought short-term improvement in timber markets in some parts of the region, but prospects for a return of El Nino weather conditions is “potentially the brightest hope for the near future,” President Marshall writes in the summer issue of his firm’s newsletter, The F&W Forestry Report.

“While NWS [National Weather Service] won’t say we are back to El Nino yet, at least there is a 50-50 chance we will get there in the next six months,” Thomas writes.  “Oftentimes it takes a little rain to help tree markets find their potential, for buyers to feel enough pressure to pay their top price.  We haven’t had enough rain in a long time, Southwide, to put real pressure on our markets.  Maybe, just maybe, there is enough increased demand in our depressed markets for a little (or a lot) of rain to decrease supply enough so we can see how high prices can go.”

TO SEE THE FULL ARTICLE IN THE SPRING 2012 F&W FORESTRY REPORT, SUBSCRIBE NOW.