Tag: Market Report

The EU renewed anti-dumping duties on imports of okoumé plywood manufactured in China on 7^th April. These duties were originally introduced by the EU in 2004 and would have lapsed after only five years had not an interested party requested the European Commission (EC) to initiate an expiry review. In 2009, the European Panel Federation (EPF) requested a review which led the EU to extend the duties for another 5 years from January 2011. Near the end of that period, in October 2015, the EPF once again requested that the EC initiate an expiry review. This new investigation led to the announcement of another 5-year extension from April 2017.

Indonesia issued the first ever FLEGT licenses in mid-November last year with high expectations that these would boost the value and share of Indonesia’s wood exports to the EU. This is a reasonable expectation, given the very significant commitment and investment by Indonesia, supported through the FLEGT Voluntary Partnership Agreement with the EU, and the mandatory requirement that all timber and timber products exported from Indonesia to the EU must now be licensed.

The upturn in EU imports of hardwood veneer which began in 2013 continued last year. The EU imported 542,000 m³ of hardwood veneer from outside the region in 2016, 12% more than in 2015. Imports from the tropics increased 10% to 313,400 m³, exceeding 300,000 m³ for the first time since 2011. However, EU imports of tropical veneer are still well below volumes of over 400,000 m³ per annum prevailing before the financial crises (Chart 1).

In 2016, EU imports of tropical sawn hardwood were 1.04 million m3, unchanged from the previous year. The value of EU imports increased by 2% to €775 million. The average unit value of tropical sawn hardwood imports into the EU in 2016 was €747 per cubic meter, up from €730 per cubic meter the previous year.

To end years of decline in UK hardwood consumption, a radical step change is required to improve two-way communication between the hardwood trade and key end-user and specifier groups, including product designers, architects, manufacturers, building contractors and retailers.

The total value of EU imports of wood products was Euro 17.48 billion in 2016, 1.3% more than in 2015. This followed an increase of 12% to  Euro 17.25 billion in 2015. In 2016 EU import value was at the highest level since 2008 just before the global financial crises (Chart 1).

Like the Domotex show held in Hanover earlier in the month, the IMM Furniture Fair in Cologne between 16 and 22 January highlighted the challenges facing tropical suppliers looking to increase their share of the European market, as pressure continues to mount from domestic manufacturers and non-wood materials. Demand for wooden exterior furniture, traditionally an important niche market for tropical wood products, is coming under pressure from other modern weather-resistant materials.

The European trade show season is now well underway, starting in Germany during January with the Domotex flooring show in Hanover and the IMM furniture show in Cologne. The shows provide good insights into European wood market prospects in the year ahead.

Latest trade data shows that the rising trend in EU import value of tropical wood products that began in the second half of 2014 levelled off in 2016. The stability in the euro value of tropical wood imports in the second half of 2016 may hide a slight fall in the volume of imports as European currencies weakened on foreign exchange markets during that period (which implies a rise in import prices).

The EU’s FLEGT process has recorded two landmark events in recent weeks. The first ever FLEGT licenses were issued by the Indonesian Licensing Unit on 15 November and the licensed consignments landed in the EU in early December. And after nearly six years of negotiations, Vietnam and the EU agreed in principle to sign a FLEGT Voluntary Partnership Agreement (VPA) and to ratify the agreement as soon as possible in 2017.