Japan
Wood Products Prices
Dollar Exchange Rates of 25th
Feb
2025
Japan Yen 150.65
Reports From Japan
Recovery in business
spending
The economy expanded an annualised 2.8% in the 2024
October-December quarter according to Cabinet Office
data backed by a recovery in business spending. The
positive figures will likely support the Bank of Japan's
plan to keep raising interest rates and normalise monetary
policy.
While the latest wage and household spending indicators
showed encouraging signs analysts are anticipating price
pressures will delay a full recovery in personal
consumption in the short-term.
In mid-February the government maintained its view that
the Japanese economy is recovering moderately but noted
that consumer spending has yet to fully pick up. There was
also a mention that US tariff threats, if implemented,
would slow export growth.
Exports were supported by strong shipments to Asia,
driven by solid demand for production machinery in China
and chip-manufacturing equipment in some other Asian
countries. The report also said "full attention should be
given to U.S. economic policies as a series of higher tariffs
are planned on imports”.
See: https://www.asahi.com/ajw/articles/15628672
and
https://mainichi.jp/english/articles/20250219/p2g/00m/0bu
/039000c
Trend in machinery orders reverses direction
The Cabinet Office has reported the total value of
machinery sales, excluding those for ships and by electric
power companies, declined by 1.2% month-on-month in
December 2024, the worst reading in four months. The
latest reading also reversed the 3.4% growth in November
and defied market expectations for a slight 0.1% gain.
Orders from the manufacturing sector dropped 10% while
non-manufacturing orders rose 5%. The biggest falls were
seen in industries such as mining, quarrying, real estate,
chemical products, information and communication
electronics and pulp, paper and paper products.
On an annual basis, private-sector machinery orders
increased 4.3% in December, slowing from a 10% surge in
November.
In the period January-March 2025 the value of private
sector machinery orders is forecast to fall.
Japanese companies try to tackle labour shortages
The Ministry of Health, Labour and Welfare has reported
the number of foreign workers in Japan has risen to a new
high of 2.3 million, the highest since 2008 when data was
first compiled.
By nationality, Vietnam had the largest number of workers
in Japan, at around 570,000 or 25% of the total, followed
by China and the Philippines with 400,000 and 240,000,
respectively. The largest year-on-year increases were with
workers arriving from Myanmar (up 61% year on year),
Indonesia (up 40%) and Sri Lanka (up 34%).
See: https://www.nippon.com/en/japan-data/h02312/
Inflation rising at the fastest pace in 19 months
Government data shows core consumer inflation was
recorded at 3.2% in January, rising at the fastest pace in 19
months, adding to expectations that the Bank of Japan
(BoJ) will raise interest rates once again.
The year-on-year increase in the core consumer price
index (CPI), which excludes fresh food prices, slightly
exceeded a median market forecast for a gain of 3.1% and
followed December’s rise of 3.0%.
A separate index stripping out costs of both fresh food and
fuel, which is closely watched by the BoJ as a better gauge
of demand-driven inflation, rose 2.5% in January from a
year earlier the data showed.
See: https://japannews.yomiuri.co.jp/news-
services/reuters/20250221-239822/
Stronger yen encourages moves to another
interest
rate increase
The yen strengthened slightly against the US dollar at the
end of February as Japanese consumer spending news
spured anticipation that the Bank of Japan (BoJ) will be
encouraged to increase interest rates at its next meeting.
The gains in yen strength gathered momentum when
Japan’s wage growth jumped by the most in nearly three
decades and accelerated even further when a pro-rate hike
BoJ board member said that rates need to go higher.
See:
https://www.japantimes.co.jp/business/2025/02/07/markets/yen-
weekly-surge/
Drop in housing starts
In 2024, approximately 722,000 housing starts were
initiated in Japan. This represented a decline of 12%
compared to the previous year. 2024 was the second time
since 1995 that the number of new dwellings fell below
800,000.
Poll shows Japanese are satisfied with housing costs
While much of the developed world is frustrated by the
rising cost of housing there are a few exceptions.
According to Gallup's Annual World Poll, which surveyed
more than 37,000 people across 38 OECD countries most
people in Japan are satisfied with housing costs.
Japan's low birthrate and restrictive immigration policies
mean its population has been shrinking for decades which
left about 10 million homes vacant across the country.
Unlike many other industrialised countries Japan's national
government controls its land-use laws through zoning
regulations and other rules that determine what gets built
where are relatively simple, consistent and not subject to
much community pushback.
Japan is particularly vulnerable to earthquakes which
mean new homes employ the latest technologies. While
American homes tend to appreciate over time and are seen
as key investments, Japanese homes tend to depreciate as
they age and become non-compliant with building codes.
See: https://www.businessinsider.com/countries-with-affordable-
housing-can-teach-us-lower-costs-japan-2024-9
Extreme snow fall in Northern Japan
Residents in northern Japan have suffered record snow
fall, occasionally reaching the eaves of the roof. Many
cities have seen record snowfall this month bringing
construction work to a standstill.
See: https://japantoday.com/category/national/northern-japan-
snowed-under-after-two-week-whiteout
December 2024 wooden office furniture imports (HS
940330)
In December 2024 China accounted for a huge 93% of
Japan’s imports of wooden office furniture (HS 940330)
thus increasing it share of imports from the around 80% in
November 2024.
The only other shippers of note in December Poland (1.5%
and a month on month increase) and Malaysia also at 1.5%
share of imports which was sharply down from the 9%
share in November.
Year on year, the value of Japan’s imports of wooden
office furniture in December rose around 8% but month on
month there was almost no change in the value of imports.
 
In December 2024 the combined value of shipments of
wooden kitchen furniture (HS940340) from the
Philippines and Vietnam accounted for around 80% of
Japan’s December imports. While the value of December
imports from the Philippines was at the same level as in
November there was an almost 17% rise in the value of
imports from Vietnam.
The third and fourth suppliers in December were Germany
and China, each capturing a 6-7% share of the value of
December imports.
The year on year value of Japan’s wooden kitchen
furniture imports rose 20% in December building on the
month gains that were observed every month since
September.
December 2024 wooden bedroom furniture imports
(HS 940350)
The top two shippers of wooden bedroom furniture (HS
940350) to Japan in December were China (61% share, the
same as in November) and Vietnam (33%), a sharp rise
compared to the value of November. Malaysia and
Thailand were the other shippers of note with Malaysia,
seeing a 3% share of December imports and Thailand a
2% share.
Compared to November there was a 5% increase in the
value of imports in December and a 13% rise compared to
the value reported for December 2023. In the third quarter
of 2024 there was a sustained monthly increase in the
value of wooden bedroom furniture some of which can be
explained by the weakening yen US dollar exchange rate.
December 2024 wooden furniture parts imports (HS
940391)
Shippers in China, Indonesia, Vietnam and Malaysia
accounted for almost 90% of Japan’s wooden furniture
parts (HS 940391) in December.
Of the total value of imports 51% was delivered from
China, almost the same value as in November; 13% from
Indonesia, a decline month on month; 13% from Vietnam,
a rise month on month and 10% from Malaysia also a
month on month increase.
Compared to the value of December 2023 imports there
was a 12% decline in the value of December 2024 imports
and compared to November there was little change. In
December 2024 fourteen shippers in Europe accounted for
around 7% of the value of arrivals.
Trade news from the Japan Lumber Reports (JLR)
The Japan Lumber Reports (JLR), a subscription trade
journal published every two weeks in English, is
generously allowing the ITTO Tropical Timber Market
Report to reproduce news on the Japanese market
precisely as it appears in the JLR.
For the JLR report please see:
https://jfpj.jp/japan_lumber_reports/
Wood export in 2024
Log export in 2024 is 1,819,493 cbms, 14.0 % more than
2023. Lumber export is 153,009 cbms, 12.5 % more than
last year. The reasons are that demand for timber in Japan
is low and the yen is weak. Log export increases for
straight two years and lumber increases for the first time in
three years. Wood export is 53.7 billion yen, 6.5 % more
than last year. This result exceeds the result of 2022, when
it was the highest wood export ever, by 2.0 %.
Logs have been exported to China mainly and the volume
is 1,636,493 cbms, 15.6 % increased from the previous
year. This is two straight years rising. The increase is 46.3
% and this is nearly 520,000 cbms.
The yen started 146 yen against the dollar at the beginning
of 2024 and depreciated to 160 yen in July, 2024. Bank of
Japan raised the rate of interest and the yen appreciated
against the dollar once. Then, yen was 140 yen against the
dollar in September, 2024 but the yen depreciated again. It
was 153 yen against the dollar at the end of 2024.
The price of log for China had been under US$110, C&F
per cbm after the Chinese New Year last year. Then, the
price stayed US$115 – 120, C&F per cbm.
The freight was US$50,000, around 2,500 cbms at the
beginning of last year and then it rose to nearly US$60,000
in autumn. Even though high freight continued, Japanese
exporters had a stable profit through the year, because the
log price was as high as around 11,000 yen, delivered per
cbm.
Logs for South Korea are 113,070 cbms, 12.3 % more than
last year and this is for the first time in two years to
increase. Logs for Taiwan are 65,823 cbms, 9.4 % less
than the previous year. This is decreasing for three years in
a row.
Lumber for China is 65,211 cbms, 15.4 % more than the
previous year and for the U.S. is 42,005 cbms, 30.6 %
more than the previous year. Demand for fences recovered
slightly in the U.S. because the inventory adjustment was
completed.
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