Timber producers in the U.S. South have faced persistently depressed softwood sawtimber prices since the 2008-2009 economic crisis. Despite a brief rally in early 2022, housing starts have remained weak, keeping sawtimber stumpage prices under sustained pressure. Nominal pine sawtimber prices are roughly half of what they were in 2000. When adjusted for inflation, real prices have fallen to nearly one-quarter of their level 25 years ago. Compounding the problem, an increased number of pulp and paper mill closures across major timber-producing regions have pulled significant pulpwood demand out of the market. Together, these forces have squeezed profit margins and tested the resilience of forest landowners through years of prolonged hardship. The last thing timber producers in the region needed amid a prolonged market downturn was a natural disaster. Yet for thousands of landowners, that is precisely the reality they now face. Recent catastrophic events have compounded an already difficult timber market environment.

Topics: Farm Tax Issues & Tax Planning, Ag Finance and Record Keeping