Month: September 2008

Newly released trade data reinforces anecdotal reports of a significant slowdown in Europe’s hardwood imports from tropical countries this year. However the news is not all bad. There has been growth in imports of some commodities into a few countries. Plywood imports from tropical countries increased significantly in the second quarter of 2008. In addition EU imports of hardwood flooring have been rising this year.

Reports from the EU sawn hardwood market are generally gloomy. Signs are that importers have returned from their summer vacations in a very cautious frame of mind, no doubt influenced by the release of yet more data to indicate that economic growth is slowing. Generally European agents report that both sales volumes and profit margins are down. Importers are focusing heavily on getting the best deal possible, closely scrutinising specifications and bargaining down prices. This is despite the fact that on-ground stocks of many hardwood specifications are no longer particularly high while available supply in the major producing regions is not great. Agents suggest that even a minor uptick in demand in the EU could soon lead to shortages as overseas producers would be unable to respond quickly enough. Agents are concerned that the European hardwood trade, having bought too much forward last year, may now respond by buying too little too late this year.