Confidence in European Economy Improves – ITTO European Market Report 15th February 2013

Prospects for the European economy seem more positive now than this time last year. The worst fears of a destructive “domino effect” that might have resulted from Greece or another country being forced out of the euro-zone have failed to materialise. The effects of the financial crises were largely contained within the most afflicted economies of southern Europe. The countries of central and north-western Europe, while experiencing higher than normal levels of economic volatility, have so far managed to weather the storm. Their relative stability has prevented the effects of the financial crises from trickling down throughout Europe. In recent months, several economic indicators in the EU, such as the Economic Sentiment Indicator and the Construction Confidence Index, have improved (see Charts 1 and 2). There is cautious optimism that economic reforms in the most troubled EU countries are beginning to work.

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No End in Sight to Recession in European Construction Sector – ITTO European Market Report 15th January 2013

Hopes of a speedy recovery for the European construction industry have been dashed. Forecasts issued at the latest Euroconstruct meeting held in Munich during December 2012 suggest that the euro crises is continuing to hold European construction activity in check. Activity is being curbed by high unemployment, stagnant economic growth or even economic downturns in many places, as well as the strained financial situation of the public sector.

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European Plywood Market Undergoing Rapid Change – ITTO European Market Report 15th December 2012

The European plywood market is undergoing a rapid period of change. Since the start of recession in 2008, the market has become less and less willing to pay premium prices for tropical hardwood plywood. Instead it has opted for plywood manufactured in alternative hardwood species. The emergence of China as a major supplier of large volumes of hardwood plywood at competitive prices played an important role to drive this change. Now the market looks set to alter again. This time the main driver is likely to be the EU Timber Regulation (EUTR), to be enforced from March 2013. EUTR will require that EU importers have access to documents demonstrating negligible risk of any wood product coming from an illegal source. This will present challenges for suppliers of wood products that rely on long and complex supply chains – such as many Chinese plywood manufacturers.

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ITTO European Market Report 15th November 2012

1. Key business sentiment indicators

Drawing on Eurostat data, the four charts below provide a snapshot of recent trends in market sectors important to the European wood industry. Data is provided for the EU as a whole and for the seven EU countries that are the largest individual markets for Chinese wood products in Europe.   Overall, they indicate low levels of business confidence and particularly weak activity in the European construction sector. However there are some signs of recent improvements in business confidence in a few EU Member States in September and October 2012.

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EU in International Trade – ITTO European Market Report 15th October 2012

In 2007, prior to the economic crises in Europe, the EU as a whole contributed 22% of the value of all global imports of timber products (Chart 1). As such, it was the world’s largest single importer of timber. Since then, the EU has declined in relative importance, in 2011 accounting for 17% of global wood imports, and is now a smaller importer than China (which in 2011 accounted for 19% of global timber imports). The relative decline is associated both with the rising importance of China as a consumer and manufacturer of timber products and with the dramatic decline in European consumption in response to broader economic trends. Nevertheless, Europe maintains a prominent position in the global wood trade, not only because of trade volume, but also due to the leading role of European retailers, manufacturers, designers and brands in wood product innovation, design and marketing, and of European policy makers in setting of technical and environmental standards.

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