Rains Across U.S. Southern Region Bring Cheer to Tree Growers;
Will El Nino Signal End to Historic Drought?

ALBANY, GA., July 2012 — A spurt in spring and early summer rainfall across the U.S. Southeast and mid-South has brought rare cheer to forestland owners in those regions who hope for better demand and prices for their trees.

Marshall Thomas, president of F&W Forestry Services, a leading forest management firm in the U.S. with operations in all major forested areas and in South America, said he sees “a few beams of light shining through the gloom” that may signal better times ahead for the tree growers across the drought-stricken southern pine belt regions.

Writing in his company’s publication, The F&W Forestry Report, Thomas noted that Southern pulpwood production is close to a 10-year high, housing starts are up although still historically low, and new U.S. pellet plants concentrated across the Southern region are creating  new and expanding markets for  the region’s trees.

“Another glimmer of light is in the recent agreement reached by South Carolina and Virginia with China to resume log and lumber exports to that country,” Thomas said.  “While Southern lumber and log exports to China have not been large historically, there is real potential for the Chinese to take a lot of logs and lumber from us to help them meet their aggressive building plans.”

But perhaps the greatest hope for improved timber markets, Thomas said, is in the report from the National Weather Service that the drought-related La Nina climate system has “dissipated,” with a 50-50 chance that its weather opposite— El Nino—will emerge within the next six months.

“Oftentimes it takes a little rain to help tree markets find their potential, for buyers to feel enough pressure to pay their top price,” Thomas wrote.  “We haven’t had enough rain in a long time, South-wide, to put real pressure on our markets. 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.”

About F&W:

F&W Forestry Services, Inc., of Albany, Ga., is one of the nation’s oldest and largest forest consulting and management firms.  Established in 1962, F&W operates 19 offices in 12 states comprising the Southern pine belt, the Central and Appalachia region, Upstate New York, and Oregon in the Pacific Northwest. It also manages private forestlands in South America with offices in Uruguay and Brazil.