Increased demand for Timber Products likely

One of the saddest picture that came out of the Great Earthquake in Sendai, Japan (& the subsequent Tsunami) last Friday was the huge amount of devastation to the homes of the residents as well as other properties. This damage will require enormous amount of building materials. One of the main building materials seems to be tropical hard wood.

I have appended below the 20-year chart for Sarawak Hard Log & Red Meranti Sawn timber for our perusal. We can that the prices of these 2 products are presently in an uptrend. A sudden increase in demand would lead to further increases in prices of the products. We can see when Kobe earthquake hit in 1995, the subsequent increased demand was able to sustain the prices of the same products for the next 2 years- despite these products having peaked earlier in 1993-1994.


Chart 1: 20-year price chart for Sarawak Hard Logs, Japan (Source: Mongabay)


Chart 2: 20-year price chart for Dark Red Meranti sawn timber (Source: Mongabay)

Below, I have appended the charts for 3 main timber stocks that may benefit from the increased demand in log & sawn timber. They are JTiasa, Lingui & WTK.


Chart 3: JTiasa's weekly chart as at Mar 7, 2011 (Source: Tradesignum)



Chart 4: Lingui's weekly chart as at Mar 7, 2011 (Source: Tradesignum)



Chart 5: WTK's weekly chart as at Mar 7, 2011 (Source: Tradesignum)

One timber stock that I've overlooked- TaAnn!


Chart 6: TaAnn's weekly chart as at Mar 7, 2011 (Source: Tradesignum)