Timbmet comment: Q1 2018

Nigel Cox, Managing Director Timbmet is BMBI’s Expert for Timber & Panel Products.

Poor weather during the first quarter of 2018 saw a weaker than expected demand for timber and panel products. Construction activity was slow but the market saw some recovery going into April. Looking at the quarter year on year, the underlying trend remained flat and the sector still faces a challenge.

Overall global demand is generally strong for timber and panel products. Chinese requirements continue to be a dominating factor when looking at availability and price. Hardwood availability is good but some panel product supply is still inconsistent.

Hardwood timber supply in Q1 saw a strong demand for oak – both European and American. The fierce demand for American white oak log has given rise to price increases. The cost of European oak, although currently steady, will continue to rise due to demand and limited log availability. Volumes of sawn European oak available this year will be less than last year.

African timber supply is being affected by port delays in Doula, Cameroon – the major export point for African species. This reduced flow of wood means the future is uncertain although there is currently availability for most species. We should expect shortages and price increases.

The decking season has now started and demand for traditional hardwood decking is strong. Availability is generally good but worldwide popularity of species such as Balau could lead to shortages.

Supply of panel products remains difficult with many products on allocation from manufacturers. With P2 furniture grade chipboard, manufacturers are looking to add value by adding decorative faces. This means a reduced supply of unfinished raw board and most has to be imported from central Europe.

OSB (Oriented Strand Board) supply has now stabilised with additional UK production and imports. However, the availability of MDF (Medium Density Fibreboard) remains a concern. Demand will put manufacturers under pressure as the year progresses.

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