Northwest Secondary Wood Products Exports Grow 180% in Five Years
Fact Sheet #13
While domestic orders support the majority of industry sales, the Pacific Northwest value-added or secondary wood products industries have established a presence in export markets that indicates foreign customers are already purchasing more than just raw timber. Secondary wood products exported from the Pacific Northwest have broken the $200 million mark, increasing for the fifth year in a row. U.S. Dept. of Commerce export data show that secondary products exported through the Seattle and Columbia-Snake River Customs Districts, which include all ports in Washington and Oregon, reached a record high of $203 million in 1993 and increased by 181% over 1989 levels. This represents about 15% of the nation's $1.36 billion in exports of finished and semi-finished wood products, a figure that increased 158% over the same five-year period. Despite the rapid growth in secondary product exports, however, primary wood products still dominate the nation's export product mix, generating nearly $3 billion in revenue for the Pacific Northwest in 1993 and $6 billion for the nation as a whole, according to government figures. Furniture Leads Export Categories.
Wood furniture and furniture parts are the leading value-added products exported through the Pacific Northwest, totaling $65.8 million in 1993. But according one estimate, only about $37 million of the furniture exported through Washington and Oregon was originally loaded for shipment here. The remaining furniture exported was presumably manufactured elsewhere in the U.S. and transshipped through a Northwest port.
The second leading value-added export from the region is softwood moulding, which increased 604% in value since 1989 to $52.1 million in 1993; U.S. exports of softwood mouldings totaled $94 million in 1993. In contrast to furniture, most of the softwood mouldings exported from the region are manufactured locally. Canada imported 95% of the softwood moulding exported from the U.S., Mexico imported 3%, and Japan imported 1%. Canada Leads Export Markets
The growth in value-added product exports is due in large part to increased exports to Canada. Canada imported $142 million worth of value-added wood products from the Pacific Northwest in 1993, dominating other PNW export destinations with a market share of 70%. In 1989, the first year impacted by the U.S./Canada Free Trade Agreement, exports of these same products totaled just $36 million. Softwood mouldings, wooden furniture, fabricated structural wood members, and doors currently top the list of exports to Canada from the Northwest. Canada is also the largest importer of secondary wood products from the U.S. as a whole, importing $650 million worth of products in 1993, nearly half of all U.S. value-added wood products exports.
Mexico was the number two market for the U.S., importing $164 million in value-added wood products last year. Mexico does not appear in the U.S. Commerce data as a significant market for wood products shipped through the Northwest customs districts, as goods shipped by truck or rail from the Northwest to Mexico are classified as exports from the Southwestern U.S. Exports to the Mexican market actually decreased last year, from a peak of $198 million in 1992.
Overseas marketing efforts in Japan have paid off in secondary wood products exports. Japan was the number three export destination nationally, and the number two market for the goods shipped via the Northwest customs districts. Japan's market grew by about 50% over the past five years, from $28 million in 1989 to $43 million in 1993. Goods flowing through the two Northwest customs districts represent almost half of U.S. value-added exports to Japan, which totaled $90 million in 1993, growing 33% since 1989. A Long Road to Export Diversity
While the increase in secondary wood products exports over the past five years has been substantial, U.S. and Northwest producers and exporters still have a long way to go before the solid wood products export base is truly diversified. The Canadian market currently dominates export destinations, with a 70% share of Northwest exports and a 48% share of U.S. exports. Subtracting wood furniture and parts and the Canadian market from the export figures removes 82% from both the Northwest and U.S. export totals. The remaining product categories and markets, however small in value, have grown 78% nationally since 1989 to $244 million in 1993.
With over three times the export performance of just five years ago, Northwest secondary wood products producers and suppliers have made considerable international marketing progress. The region's historical reputation as a high quality primary wood products supplier and more recently a supplier of quality value-added wood products can be built upon by the network of companies and organizations committed to export success. Dynamic global wood supplies and markets will undoubtedly create new export opportunities. In the final analysis, it will likely be some combination of quality manufacturing and international marketing expertise, currency exchange rates, and the continued availability of wood raw materials to the region's secondary producers that will determine whether the sector can sustain triple-digit growth in export values over the next five years.