Timbmet comment: Q2 2017

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

Our view in Quarter 1 was that the market for Timber and Panel Products looked promising and that we should be optimistic for the year. In reality the second quarter has been more challenging than expected. The run up to the election and the surprise result created uncertainty and confusion – and political uncertainty, whether domestic or foreign, continues to influence trade and impact our markets. At best we can say quarter two’s performance was flat.

The market for hardwood timber though is stable with no major supply issues. European oak remains popular and with the traditional summer closing of the mills, the supply chain will slow and there could be a short term impact on stocks during August and September.

The OSB (Oriented Strand Board) sector is still difficult and is feeling the effects of shortages as demand continues to outstrip supply. Prices remain volatile and continue to rise. Additional production capacity will ease the situation as we enter 2018.

MDF (Medium Density Fibreboard) supply chain shortages eased slightly in Quarter 2 compared to the previous quarter but product availability has stayed on allocation which in turn leads to continued pricing pressure.

The well-publicised and tragic fire at Grenfell Tower has shaken our industry and raised concern over building regulations and standards. Various timber and panel products are fire treated and the increased demand is impacting on the lead time for treated products. Merchants are encouraged to check availability well in advance of requirements.

In summary, we had a bumpy second quarter and the outlook for the next three months is modest.

See the full Q2 Report here: https://www.bmbi.co.uk/the-index/ 

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Launched in 2015, the award winning monthly Builders Merchant Building Index (BMBI) report is the only reliable measure of repair, maintenance & improvement (RMI) activity in the UK. Filling an important gap, it can be widely used in construction, and by economists, Government, national media, commentators and influencers outside the industry.

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