Price Transmission of Imported Hardwood Lumber in China

Since April 2015, China has implemented the policy of completely stopping commercial logging of natural forests. The implementation of this policy has led to a decrease in the supply of domestic hardwood lumber and an increase in the import dependence of hardwood lumber, which had brought about a profound impact on the price transmission among China's imported hardwood lumber. In this context,we selected the daily price data of major imported hardwood lumber (Merbau, Sapele,Triplochiton, Beech and Okoume) in China from 2011 to 2019 for empirical study. June 1, 2015 was identified as the structural mutation point, and the time interval was divided into two sub-intervals. The price transmission relationship between imported hardwood lumber was empirically analyzed by the threshold cointegration model.The results showed that each price group had asymmetric price transmission relationship in the two sub-intervals, and the asymmetry of price transmission was further enhanced after the implementation of commercial ban policy of natural forest, which led to the widening of the welfare distribution gap of timber importers and exporters, and made Chinese timber importers in a more unfavorable trade position. On this basis, we put forward some strategies to deal with asymmetric price transmission from the perspectives of government and enterprises, so as to maintain fair and reasonable timber trade.