A Cointegration Analysis of the Nordic Roundwood Markets

Abstract

The integration of the Nordic timber markets has been analysed to provide market information to various decision-makers, e.g., climate and industrial policies and investment decisions. This study addresses the interlinkage between Nordic (Sweden, Norway and Finland) roundwood markets (Scots pine (Pinus sylvestris L.)) and Norway spruce ((Picea abies L.) sawlogs and pulpwood). In total, eleven markets were analysed using quarterly data over the period 2006Q1–2017Q4 where various unit root and stationary tests were performed together with Johansen’s cointegration test. In addition, directional causality analyses between the integrated markets were also performed. The results show that the law-of-one-price (LOP) hypothesis can be rejected for most of the studied markets and that no individual market emerges as the price-leader. Only the Swedish and Norwegian pine sawlog markets are integrated suggesting a single market for both countries. Price affecting national and forest-related policies as well as investments in the forestry sector, forest industries, bioenergy sector and other forest product using sectors, will not disperse into a larger international market structure; instead, the price effect will be national and more likely have a more profound effect.

Economic Impacts of Forest Storms—Taking Stock of After-Vaia Situation of Local Roundwood Markets in Northeastern Italy

“…The increase in wood supply was accompanied by a decline in local roundwood prices. Although we cannot directly relate the decrease in price to the increase in quantity, as no analytical supply models were constructed, these results are in line with the findings of other research on storm-induced market changes [4,[11][12][13][14][15]. Therefore, as occurred in Northern and Central European countries, we can expect that actors in the local wood chains will have to face both short-and long-term economic impacts in the years to come.…”

“…Nieuwenhuis et al [14] documented the same drop in Ireland following a storm in 1997. Eriksson et al [15] reported that in Sweden and Nordic countries, spruce sawlogs prices fell after the Gudrun storm in 2005 until the 2010s and did not regain ante-storm prices. Conifer timber is not the only wood affected by market price fluctuations; however, studying the dynamics of beech (Fagus sylvatica L.) roundwood prices in Central European markets, Ko żuch et al [16] found that yearly price variation was more due to political and economic instabilities (i.e., the economic crisis in 2008/09) than to extreme natural events.…”

The Quantification and Tracing of Leakage in the Forest Sector in Nordic Countries

“…In the NFSM model framework, wood and wood products are posited to exist in a state of homogeneity within a perfectly competitive global market; this characterization can ease the trade of goods from one region to another. This is deemed a potential limitation in light of findings in a study by [38]. In fact, the wood product market aligns with a degree of homogeneity and wide international trade, distinct from goods like energy, as mentioned in [9].…”