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West and Central African producers now depend on the market in China where, recently, there have been mixed signals on the strength of the construction and housing sectors
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With Chinese New Year falling on 19 February producers report the activity of buyers has slowed and markets are quiet. With so much of the trade being conducted with Asian countries the impact of the lunar holiday is very noticeable
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Producers are satisfied with the current order book positions and consider these as about normal levels for this time of year. They are now more confident about log supplies and have indicated they could meet any increase in demand from EU buyers should they begin to restock. However, producers are not expecting any significant change in the flow of orders from Europe. The Ukraine conflict and sanctions on Russia are beginning to weaken the economies of some EU member states, particularly Germany and France, compounding the impact of the depressed construction sector in many EU member states...
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Producers report that demand from European buyers remains very quiet with not a hint of the usual autumn up-tick in purchases. Overall, exporters in West Africa are not at all optimistic on prospects for any growth in demand in EU markets. Current demand in northern Europe is heavily concentrated on ayous, sipo and sapele sawnwood. The slow response of some EU members to enforcement of the EUTR is attracting the attention of green activists who seem set to put pressure on authorities to ensure stricter adherence to the regulation.
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European buyers have not yet resumed purchasing after the summer vacation period but, with the economies in the main markets in the EU looking more positive W. African producers are convinced they will see sustained business through to year end...
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Producers in West Africa report that the rather quiet but sustained demand continues with new orders flowing at a steady but unchanged pace. European buyers have not yet returned in any strength to negotiate contracts for the fourth quarter. This is a slower resumption of the autumn and winter round of purchases...
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The demand for sapele logs and sawnwood remains firm and prices continue to climb. Over the past two weeks prices for sawn moabi and movingui have also shown signs of firming on the back of active buying for the French market...
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The European summer vacation period, when importers wish to slow incoming shipment, is allowing producers to catch up on outstanding orders and to improve delivery times for the new business which is expected when European buyers return to the market at the end of August...
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Demand in China, Vietnam and the Middle East is said to be very active while buying for the European market is subdued due to the holiday season. Prices for logs of premium species are still moving up slowly as demand continues to be strong. If demand strengthens further it will be availability that will drive prices higher or force substitution...
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The upward movement in prices for the premium species continued into the first weeks of June and the new prices levels seem well established. Producers have been emphasising that they are currently close to the maximum log production limit in their government approved forest management plans and that it will be almost impossible to increase output any further...
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Recent price rises for the most frequently demanded timbers have been consolidated as demand is now as firmer, a term that has not been used by producers in the region for several years. Producers are convinced from current developments that demand will remain firm stretching into the third quarter of the year...
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At present there are two main drivers of log prices one is the firming demand for sawnwood in major markets the other the limited availability of the prime species...
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Log and sawnwood prices remain unchanged after the minor adjustments reported earlier in the month. The good news is that log exports from Cameroon are improving strongly and higher volumes of sawnwood are also beginning to flow onto the market. Producers report that demand from Middle East buyers is firm and that the trade is very active. West and Central African producers appear confident of maintaining and even increasing their market share in the Middle East markets. Demand in Asian markets is unchanged and very firm at current prices...
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While West and Central African exporters report good order book positions, demand levels are flat providing no opportunity for price increases. Analysts say there is little chance of a significant change in the second quarter as European demand has not picked up to any notable extent in spite of a generally mild winter which allowed construction companies to continue working...
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The current quiet market demand in Europe continues unchanged from January and this is expected to remain through until the end of the first quarter, and possibly well into April or May. On the other hand, West and Central African exporters report good steady business in the Middle East and also a discernible improvement in demand in Asian markets where purchases did not slow over the New Year period this year as much as in previous years...
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Producers are expecting a somewhat quieter period for new sales in the first quarter so are concentrating on shipping current contracts. There were no major price movements in the period from mid December to the present and market conditions are said to be slow but stable. Producers in Cameroon are slowly getting production back to normal after the very heavy rains. There is news of increased log exports due, say analysts, to a relaxation in the quota system...
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