Forest Products Laboratory

Title: Recent economic downturn and pulpwood markets

Author: Ince, Peter J.

Date: 2002

Source: Proceedings of the 2002 Southern Forest Economics Workshop, 2002 March 17-19 ... Virginia Beach, Virginia. [Blacksburg, Va.] : Virginia Polytechnic Institute and State University, 2002: pages 157-182.

Description: The U.S. economy entered a period of slow growth in 2000, tilting toward economic recession in 2001, the first broad economic downturn in a decade. This recent downturn was associated with a recession in U.S. industrial output from 2000 through 2001. U.S. paper and paperboard production declined from 1999 to 2001, with total production 8% lower in 2001 than the historical peak in 1999. The recession in manufacturing and downturn in paper and paperboard were linked to an exceptionally strong U.S. dollar, which attracted a flood of imported goods, limited growth in exports, and contributed to an exceptionally large U.S. trade deficit. The slowdown in the overall U.S. economy offset domestic demand for paper and paperboard and compounded the trade effects of the strong dollar. Mill closures and capacity reductions helped forestall what might otherwise have been a complete market rout for paper and paperboard commodities, but wood pulp and pulpwood prices all but collapsed. A turnaround in the economy was widely anticipated and appeared to be underway in the first half of 2002, but the downturn has already had a fairly profound impact, particularly in terms of expectations for growth in the pulp and paper sector, and also for pulpwood markets of the South. Longer-term economic issues and implications for pulpwood markets are discussed in this paper.

Keywords: Pulpwood, markets, pulp, paper, forest products industry, economic aspects, pulpwood industry, forest products, marketing, statistics

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Citation

Ince, Peter J.  2002.  Recent economic downturn and pulpwood markets.   Proceedings of the 2002 Southern Forest Economics Workshop, 2002 March 17-19 ... Virginia Beach, Virginia. [Blacksburg, Va.] : Virginia Polytechnic Institute and State University, 2002: pages 157-182..