バイデン大統領の優先政策は米国の森林投資に追い風

オリバー・ウィリアムズ、CFA
農地投資グローバル・ヘッド

キース・バルター
マネージング・ディレクター、エコノミック・リサーチ

ダニエル・セルナ
アソシエート・ディレクター兼シニア・ポートフォリオ・マネージャー

【日本語抄訳】

・バイデン政権が推進する政策により、米国の森林セクターへの追い風は勢いを増す可能性があります。

・連邦政府の住宅政策の転換により、特に低所得者層への住宅ローンの供給が拡大・緩和される可能性があります。

・移民政策の柔軟性が高まり、ひいては労働力の供給が増加することで、森林セクターの成長が促進されることが見込まれます。

・パリ協定への再加盟は、森林の炭素吸収能力をより明確に評価することで、森林への新たな投資意欲を促進すると考えています。

【英語原文】

Biden’s policy priorities bode well for U.S. timberland investing

Key Takeaways

• Tailwinds for the U.S. timberland sector may gain momentum from policy initiatives backed by the Biden administration.
• A shift in federal housing policy could broaden and ease the availability of mortgages, particularly to lower-income segments of the market.
• We believe increased flexibility in immigration policy and, by extension, an increased supply of labor should help facilitate the growth of the timber sector.
• Reentry into the Paris Agreement is another plus, supporting new investment interest in timberland motivated by a more explicit valuation of the carbon-capturing capabilities of forests.

The U.S. forest product sector and timber demand entered 2021 with strong forward momentum. Housing starts were at the highest level in 19 years, softwood lumber prices reached all-time highs, and prices for softwood sawlogs were trending higher. The tailwinds for the timber sector that were developing in much of 2020 should gain some added support from policy initiatives that the Biden administration is considering to support the economy and the job market. U.S. Treasury Secretary Janet Yellen’s accommodative monetary policy, coupled with aggressive fiscal stimulus, should be a major boost to residential construction activity in 2021. Forest product manufacturers should also benefit from an expected easing of restrictions on immigration by the Biden administration. In addition, the role of timberland as a natural climate solution should be increasingly recognized and valued with action on climate change occupying a top spot on the Biden agenda.

U.S. forest product and timber markets proved resilient in 2020, due to robust residential construction activity for both new home construction and repair and remodeling of existing homes. For the year 2020, U.S. housing starts totaled 1.4 million units, an 8% increase over 2019. In addition, the mix of new home construction shifted to single-family homes, with the share of them jumping from 69% in 2019 to 72% in 2020.¹ Single-family construction uses more wood products than multifamily construction, in light of the dominant single-family construction system, which emphasizes wood rather than concrete and steel.

U.S. housing starts began 2021 strong

Source: U.S. Bureau of Labor, January 24, 2021.

The strong construction activity of 2020 translated into a surge in softwood lumber and wood panel prices and a corresponding lift in timber prices. The Random Lengths softwood lumber composite reached a high of $947 per thousand board feet (MBF), on average, during the month of September, 165% above 2019 levels.² The impact of the robust wood product markets on timber values was the most pronounced in the U.S. West Coast, which is characterized by a tight demand/supply balance for timber, and by the final quarter of 2020, timber values were gaining forward momentum across the United States.

U.S. prices for solid wood reach record levels, and Western log prices follow

Lumber and timber prices

Source: Fastmarkets RISI, January 28, 2021. MBF refers to thousand board feet.

Mortgage rates are currently near historical lows, and the U.S. Federal Reserve has signaled that it intends to maintain rates at low levels in 2021 even in the face of temporary flare-ups in inflation. This accommodative monetary policy has resulted in extremely favorable credit availability for new home buyers, and these conditions are likely to hold steady in 2021.

Addressing mortgage equity may increase credit availability

Source: Housing Finance Policy Center, January 28, 2021.

The Biden administration's $1.9 trillion COVID-19 stimulus package can be meaningful, quickly following the $0.9 trillion stimulus package passed in December 2020. As a result of the 2020 federal stimulus programs and curtailed consumption during the pandemic, the U.S. savings rate surged. Preliminary data for 2020 shows total savings for 2020 was $1.6 trillion higher than in 2019, providing the financial wherewithal to home buyers in the coming year.³

Increased federal support for the rapid deployment of the COVID-19 vaccination should bolster the economic recovery and help push the unemployment rate lower. The combination of continuing low interest rates, stronger job markets, and healthy household savings should boost consumer confidence and provide a strong foundation for robust demand for housing and construction activity in 2021.

An additional boost to housing markets may develop from the Biden administration’s executive order directing the Department of Housing and Urban Development to take steps necessary to redress racially discriminatory federal housing policies, in particular addressing mortgage discrimination.⁴

Credit availability has tightened as of the third quarter of 2020, with the Housing Credit Availability Index (HCAI) reaching a historic low. The HCAI tracks the percentage of owner-occupied home purchase loans that are likely to default. An HCAI moving lower indicates that lenders are less willing to tolerate defaults and are imposing tighter lending standards. A shift in federal housing policy could broaden and ease the availability of mortgages, particularly to lower-income segments of the market.

In addition to the support for housing resulting from the Biden administration’s agenda, the timber sector should also benefit from the administration's move to more accommodation on immigration issues and its strong commitment to addressing global climate change. We believe an eased stand on immigration compared with the Trump years improves the outlook for availability of labor. In recent years, labor availability in both the construction sector and in moving timber out of the forest and into mills has been challenging. As the economy recovers from the pandemic and unemployment rates head lower, increased flexibility in the labor supply should help facilitate the timber sector's growth.

Many corporations and other organizations are already formulating goals to achieve net-zero, or even net-negative, emissions by 2050. The Biden administration’s efforts to tackle climate change bode especially well for the timberland asset class, underscoring the importance of trees, based on their ability to sequester carbon, as an option for businesses and other organizations to meet their carbon reduction targets.

The Biden administration’s creation of a Climate Envoy—former U.S. Secretary of State John Kerry—marks the first time the National Security Council will include an official dedicated to climate change. President Biden’s choice of former Michigan Governor Jennifer Granholm, a strong advocate for zero-emission policy initiatives, to head the Department of Energy and the immediate reentry into the Paris Agreement are further strong positives for timberland, suggesting the development of new investment interest in timberland motivated by a more explicit valuation of the carbon-capturing capabilities of forests.

1 U.S. Bureau of Labor, January 24, 2021. 2 Fastmarkets RISI, January 28, 2021. 3 wsj.com/articles/the-risks-of-too-much-stimulus-11612307861, February 2, 2021. 4 politico.com/news/2021/01/26/biden-executive-orders-racial-equity-462663, January 26, 2021.