# Timber: Correlation Prices it moves with, and why Source page: https://www.materialinsights.org/commodities/lumber/correlation/ The series is the Malaysian sawnwood export price, a tropical hardwood. Timber prices depend on logging rules, housing and furniture demand, freight, and competition from plantations and softwood producers. Market price **World Bank Pink Sheet: Sawnwood, Malaysian** $/cubic meter · monthly, Jan 2006 to Sep 2026 #### What its price moves with Selected link ##### Timber and Biomass Monthly changes 0.05 little or none correlation 12-month changes 0.09 little or none correlation Last 5 years 0.05 monthly changes Lead or lag none No clear lead or lag Price function, Dec 2011 to Sep 2026 Timber ≈ 6,535 × (Biomass)^-0.47 R² 0.36 On this fit, a 10% higher biomass price goes with a −4.4% lower timber price over the long run. Units: $/cubic meter and index (BLS base period =100). Chart: Timber and Biomass prices rebased to 100 at Dec 2011, log scale Both prices rebased to 100 at Dec 2011, on a log scale so equal percentage moves look the same size. Chart: Timber price against Biomass price, monthly, log scales, with fitted line Each dot is one month; paler dots are older (2011), darker dots recent (2026); the ringed dot is the latest month. The dashed line is the fitted price function. Both axes are logarithmic. Energy [Bm Biomass](https://www.materialinsights.org/energy/e_biomass/)By-product 0.05 Sawmills produce wood chips and sawdust, sold as fuel and for pulp. The biomass proxy is a US wood chips index, and shows little link: monthly moves correlate at 0.05 and yearly moves at 0.09, because local energy markets set chip prices. little or none co-movement month to month · 178 months Show charts Commodity [St Steel](https://www.materialinsights.org/commodities/steel/)Substitute 0.13 In buildings, steel and timber compete for beams and frames, both driven by construction. The link with tropical hardwood is weak: monthly moves correlate at 0.13 and yearly moves at 0.38. little or none co-movement month to month · 249 months Show charts Commodity [Cem Cement](https://www.materialinsights.org/commodities/cement/)Substitute −0.06 Concrete competes with timber in building, and both depend on construction demand. The US cement index shows no link with Malaysian hardwood, with monthly moves at minus 0.06 and yearly moves at minus 0.29. little or none co-movement month to month · 249 months Show charts Commodity [PO Palm oil](https://www.materialinsights.org/commodities/palm_oil/)Competing land use 0.34 In Malaysia and Indonesia, forests have been cleared for palm oil plantations, and both depend on the ringgit and Asian demand. Monthly moves correlate at 0.34 and yearly moves at 0.44, a shared regional driver. weak co-movement month to month · 249 months Show charts Chemical [Adh Adhesives and sealants](https://www.materialinsights.org/chemicals/adhesives/)Processing input −0.04 Plywood and engineered wood are glued with resins, so adhesive costs affect wood products. Sawnwood itself uses no glue, and the data shows no link: monthly moves correlate at minus 0.04. little or none co-movement month to month · 249 months Show charts How to read these numbers **Correlation of monthly changes** (the number in the coloured pill) compares how much each price moved, month by month, since 2006 or the first month both series exist. It runs from −1 to +1: near +1 the two usually rise and fall in the same months, near 0 there is no link, and a negative number means they tend to move in opposite directions. Above 0.7 is strong, 0.4 to 0.7 moderate, 0.2 to 0.4 weak. **12-month changes** compare year-on-year moves, which shows whether two prices share the same cycles even when the month-to-month noise differs. **Price function** is a straight-line fit of the two prices on logarithmic scales: price ≈ k × (partner price)^β. β is how much this price moves, in per cent, for a 1% move in the partner over the whole period, and R² is the share of the variation the fit explains. Two prices that both drift up with inflation can fit well without any real link, so read it together with the monthly correlation. **Lead or lag** checks whether the monthly correlation is clearly higher when one price is shifted by 1 to 6 months. Correlation is not cause. The reasons on each card explain the economic link; the numbers show how strongly it has shown up in prices. Proxy series are US producer price indexes or related prices and can blur the real link. Data: World Bank Commodity Price Data (Pink Sheet), October 2026; US Bureau of Labor Statistics producer price indexes, IMF primary commodity prices and US EIA prices via FRED, Federal Reserve Bank of St. Louis, retrieved November 2026. Calculations by this site. ## Other sections - [Summary](https://www.materialinsights.org/commodities/lumber/index.md) - [Overview](https://www.materialinsights.org/commodities/lumber/overview/index.md) - [Extraction](https://www.materialinsights.org/commodities/lumber/extraction/index.md) - [Production](https://www.materialinsights.org/commodities/lumber/production/index.md) - [Stocks](https://www.materialinsights.org/commodities/lumber/stocks/index.md) - [Cycles](https://www.materialinsights.org/commodities/lumber/cycles/index.md) - [Trading](https://www.materialinsights.org/commodities/lumber/trading/index.md) - [Movement](https://www.materialinsights.org/commodities/lumber/movement/index.md) - [Criticality](https://www.materialinsights.org/commodities/lumber/criticality/index.md) - [Characteristics](https://www.materialinsights.org/commodities/lumber/characteristics/index.md) - [Emissions](https://www.materialinsights.org/commodities/lumber/emissions/index.md) - [Relationships](https://www.materialinsights.org/commodities/lumber/links/index.md)