world news - 28.12.2004
Pallet & Packaging: Short Timber Supply
In line with other consumables, pallet & packaging prices are set to rise still further in the New Year as the supply of suitable timber remains in short supply at current price levels. Off the back of substantial increases in 2004, panel products are also expected to increase further due to rising costs for resins, energy and strong levels of global demand.
The Baltic supply chain continues to prove difficult for timber buyers and users are actively seeking new providers. Many producers have already reverted to utilising long length material from the UK, South America and Sweden where price permits and are currently considering investment in further re-processing facilities to ensure control and continuity of supply.
Prices paid for Baltic timber imported to the UK have risen by an estimated 10 per cent this quarter and manufacturers predict a further increase of five or six per cent in the New Year.
‘Gazumping’ is becoming a regular feature in the Baltic market as consumers get desperate for timber and boats, there are no signs of improvement in the short-term, particularly in lieu of the winter months. South American imports have already increased and Portugal is the next likely source for ‘cut-to-size’ material if prices continue to rise. Sweden remains a reliable source for softwood for manufacturers with re-processing facilities, although recent currency pressure has forced a ‘hike in price’.
As a result, the supply of Baltic timber to the UK has fallen. The overall effect has been a growing shortage of pallets in the UK market, as buyers struggle to bring supply on-line with short-term requirements as timber contracts remain unfulfilled.
Timcon urges its members not to guarantee prices for longer than three months and to ensure their contracts make clear that the price being quoted is subject to the supply of raw materials. IHB Internationale Holzboerse GmbH
See also:
- — Russia: leased trucks ready to roll
- — Romania: Competition Council fines Kronospan
- — USA: Sawmills expect 2005 modest decline
- — Russian timber sector to increase production by 3% in 2004
- — USA: Sawmills expect 2005 modest decline
