Abstract:
Japan is the largest market for U.S. forest products.
Therefore, export of wood products to this country is
critical to the economic life of the forest industry in
the U.S. and particularly for the Pacific Northwest.
Hence, economic conditions and developments in Japan may
significantly affect the volume of trade for the products
of concern and, in turn, the well-being of the U.S. lumber
and log production-consumption system. Few studies have
addressed forest product trade between the U.S. and Japan.
This study is designed to determine the effect of
several selected market factors on the Japanese import
demand for U.S. softwood lumber and logs and to estimate
the influence of these factors on Japan's future trade. A
numerical model was developed incorporating these
selective factors, thought to be relevant, to determine
their effects on the Japanese market for the U.S. forest
products. The evaluation considers the effects of
variations in: Japanese income, domestic production of
softwood logs in Japan, domestic prices of the products of
concern, petroleum purchased by Japan, nominal interest
rates in Japan, the exchange rates, and finally a weighted
average of prices of the products from the Pacific
Northwest (Oregon and Washington, only). Given the
available resources, two empirical time series models for
each commodity were estimated by OLS technique using
annual data from 1961 through 1985.
The results indicate that the Japanese import demands
for both products are inelastic. This finding, along with
other evidence, suggests the distortion of the Japanese
import demand for U.S. forest products by factors other
than economic, mainly politics involved in trade restraint
between the two countries.
The study shows that GNP per capita, housing starts,
and the interest rates in Japan, significantly affect the
Japanese import demand for lumber from the U.S. Housing
starts is the only significant factor in the case of the
Japanese import demand for U.S. logs. In the latter case,
the exchange rates and log export prices to Japan
(deflated by Japan's wholesale price index), are
significant only when the log linear model has been
applied.
