Mills in West Africa lowering production to match slow demand

Источник:
ITTO
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2015
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Log and sawnwood prices are unchanged in from those reported at the end of May as demand in western international markets is very slow. Sawmills in the region are reported to be either cutting back on production or temporarily ceasing operations in an effort to match output with current levels of demand.

Analysts remark that markets generally appear to have now entered a much quieter period and there are no signs of any substantial change in consumption of tropical hardwoods in Europe. Until the summer holiday period is over it is difficult to gauge how demand will develop in the second half of the year.

Importers in China are adjusting purchases in anticipation of a further weakening of demand as economic growth in the country slows. Log stocks in China are said to be still well above demand levels especially for okoume and okan.

Producers in West Africa do not expect any marked change in demand and during these quieter conditions are managing output levels to sustain current prices. At the same time while adjusting specifications to the recent „mixed grade‟ that some buyers are beginning to accept.

Intense competition in Middle East markets

Only the Middle East markets remain buoyant where demand is firm but where prices are constantly under pressure because of intense competition from several sources including from N. American hardwoods. With so much destruction in the region it is an unfortunate fact that the Middle East will be a major timber market when reconstruction becomes possible.

Despite the good news on the Indian economy few West African suppliers have ventured into this market which offers good prospects.

For the coming months West and Central African producers accept the need to carefully manage output in an attempt to provide the foundation for current price levels.

Advancing the VPA in Liberia

The EU FLEGT Facility has reported on a meeting of the Joint Implementation Committee of the Liberia-EU FLEGT Voluntary Partnership Agreement held to review implementation to-date, take stock of the effects of Ebola on activities and agree on the priorities for the 2015.

Among the issues discussed at the meeting were the key milestones in the development of the timber legality assurance system, further reinforcement of the legal framework and law enforcement as well as recent developments and challenges in the sector, including community forestry management agreements and transfer of timber revenues to communities.

Both Liberia and the EU were happy to acknowledge that the Ebola crisis has not derailed the VPA process, although it has generated significant delays.”

A statement from the EU says “the process to conclude the VPA is expected to last for several years but will promote legal forestry leading to more sustainable forest management, increased long-term revenues for communities and the government, investment and job creation.

Log Export Prices

West Africa logs, FOB € per m³
Asian market
LM
B
BC/C
Acajou/ Khaya/N'Gollon
230
230
160
Ayous/Obéché/Wawa
260
260
180
Azobe & Ekki
230
230
160
Belli
300
280
-
Bibolo/Dibétou
150
145
 
Iroko 330
290
260
Okoume (60% CI, 40% CE, 20% CS) (China only) 240
240
160
Moabi 335 305 225
Movingui 210
210
160
Niove
160
160
-
Okan
250
250
-
Padouk
310
285
225
Sapele 320
320
240
Sipo/Utile
345
340
265
Tali 320 320
-

                                                                                                                                               

Sawnwood Export Prices

West Africa sawnwood, FOB
€ per m³
Ayous FAS GMS 400
Bilinga FAS GMS 500
Okoumé FAS GMS
370
Merchantable 225
Std/Btr GMS 300
Sipo FAS GMS
610
FAS fixed sizes 610
FAS scantlings 660
Padouk FAS GMS 900
FAS scantlings 980
Strips 500
Sapele FAS Spanish sizes 600
FAS scantlings 600
Iroko FAS GMS 615
Scantlings 680
Strips
440
Khaya FAS GMS
450
FAS fixed
470
Maobi FAS GMS
610
Scantlings
615
Movingui FAS GMS
420
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