{"id":74938,"date":"2017-12-04T10:38:30","date_gmt":"2017-12-04T10:38:30","guid":{"rendered":"https:\/\/tin.happy-projects.ro\/ihc-2017-review-trends-challenges-and-new-projects-in-international-hardwood-trade\/"},"modified":"2025-09-19T08:47:10","modified_gmt":"2025-09-19T08:47:10","slug":"ihc-2017-review-trends-challenges-and-new-projects-in-international-hardwood-trade","status":"publish","type":"post","link":"https:\/\/www.timberindustrynews.com\/ro\/ihc-2017-review-trends-challenges-and-new-projects-in-international-hardwood-trade\/","title":{"rendered":"IHC 2017 review: Trends, challenges and new projects in international hardwood trade"},"content":{"rendered":"

On 15 and 16 November 2017 the International Hardwood Conference took place in Venice. Several speakers pointed out recent achievements of the hardwood industry as well as their threats and challenges as there are illegal logging and trade and at least partly a lack of raw material.\u00a0<\/em><\/p>\n

Outstanding hardwood projects<\/strong><\/p>\n

Italian hardwood furniture maker Riva has formed a marketing relationship with Lamborghini, branding a new range after the supercar marque and backing it with high-octane promotion (www.riva1920.it)<\/p>\n

At the same time, sports stadia architects Populous have incorporated 11 American white oak glulam beams as core structural components of a new stand at the Lord\u2019s Cricket Ground in London. At 23m long and four tonnes each, they are thought to be Europe\u2019s largest cantilevered engineered timber beams, not to mention a structural application first for white oak (www.americanhardwood.org).<\/p>\n

And in another hardwood twist, the \u2018Fair and Precious\u2019 branding initiative has been launched by the International Tropical Timber Technical Association (ATIBT), underlining the economic, environmental and social value of the tropical sector.<\/p>\n

Each of these projects formed a speaker topic at the 2017 International Hardwood Conference, appropriately held in Venice, a city, which CNR Ivalsa researcher\u00a0Nicola Macchioni<\/strong>\u00a0explained to the 150-strong, 17-nationality IHC audience, was built on an ingenious foundation system of largely hardwood piles. With these and other upbeat presentations, the IHC communicated a confident, international hardwood industry that\u2019s adapting to market needs.<\/p>\n

Challenges: Illegal logging, raw material supply and the \u2018800 pound gorilla\u2019<\/strong><\/p>\n

But the event, organised by Italian trade federation Fedecomlegno in association with the European Timber Trade Federation and European Organisation of Sawmill Industries (EOS), wasn\u2019t 100% positivity. It acknowledged too that the sector had obstacles to overcome. Illegal logging and trade remained significant issues and verifying the legality and sustainability of the bona fide industry\u2019s products could also prove complex, said speakers. Ensuring raw material supply, given growing worldwide demand, was another challenge.<\/p>\n

The consensus was that the hardwood business has exciting opportunities, but operates in an ever faster moving, more competitive market. Key issues highlighted were globalization and seismic geographical shifts in consumption to emerging markets, notably, although not exclusively, China, or as AHEC Executive Director Mike Snow put it, the \u2018800 pound gorilla in the room\u2019.<\/p>\n

In his welcome address Fedecomlegno chairman and CEO of Legnonord Spa Alessandro Calcateterra summarized the sector\u2019s position. \u201cAverage per capita wood consumption is still just 0.5%, so there\u2019s huge growth capacity,\u201d he said. \u201cIn fact global roundwood demand is forecast to rise 60% by 2030. This makes it ever more critical to address where timber comes from, how it\u2019s produced (FAO experts forecasts one third will come from plantations by then) and where it should be used.\u201d<\/p>\n

Hardwood log exports: A crucial issue for European sawmills<\/strong><\/p>\n

EOS president\u00a0Sampsa Auvinen<\/strong>\u00a0also highlighted industry challenges. In Europe, he said, the hardwood sector had to contend with a stubborn lack of growth despite economic recovery. In fact sawmill numbers in France, Germany and Belgium alone were down 30% in the last decade. This was partly due to industry concentration in the downturn, but there was also the crucial issue of increasing log exports to emerging economies. \u201cWe have great opportunities to capitalize on hardwood\u2019s performance characteristics,\u201d said Mr Auvinen. \u201cBut, while avoiding protectionism, we must insist on a level international timber procurement playing field. Without raw material the European sawmill industry will be forced out of the market.\u201d<\/p>\n

Global trade trends: Flat market with strong rise of consumption in Asia<\/strong><\/p>\n

In his international market overview, analyst\u00a0Rupert Oliver<\/strong>\u00a0of Forest Industries Intelligence said latest statistics showed global hardwood trade static at around $35 billion, underlining a continuing and \u2018disappointing\u2019 lack of market value growth since the 2000s. \u201cSince then global population has increased by 1 billion, with 1.4 billion people taken out of poverty, so you\u2019d expect more growth,\u201d he said. \u201cBut bar a surge in rosewood trade in 2014, market value has been flat.\u201d However, underlying this outwardly static picture was a dramatic shift in the balance of hardwood market power, both in terms of log and sawnwood consumption, to Asia.<\/p>\n

India had been a hardwood log consumer on the rise, but blocks on teak exports from Myanmar and Malaysian supply issues had seen its transition to more lumber buying. But log imports by China, and to a lesser extent Vietnam and other Asian hardwood product manufacturers, continued their inexorable rise. In fact Chinese imports hit 14.3 million metric tonnes in 2015, with 15.4 million tonnes forecast for 2016.<\/p>\n

In sawn hardwood, total global temperate trade was worth around $6 billion in 2016 and tropical $4.5 billion, with the US the single leading exporter and Thailand biggest tropical supplier. China again was the consumer making the headlines with imports this year expected to be nine million tonnes, up from 2016\u2019s eight million and including around 1.5 million tonnes from the US alone.<\/p>\n

Mr Oliver concluded that the hardwood sector may struggle near term to grow trade volumes, but had opportunities to increase value. Difficulties to overcome included over reliance on a few species, limitations of current environmental controls to halt illegal trade and industry fragmentation, which limited opportunities for concerted promotion and investment, including in plantation development. But positives were revived interest among specifiers in real wood as opposed to substitutes, development of higher specification engineered and modified hardwood products and emergence of more realistic risk-based assurance of legality and sustainability. \u201cLatest technology can also better evaluate trade data and reduce sustainability certification cost,\u201d he said.<\/p>\n

America's hardwood transition: Lower production, higher exports, notably to China<\/strong><\/p>\n

Mike Snow\u2019s<\/strong>\u00a0topic was a US hardwood sector in dramatic transformation for the past 10-15 years. The economic and construction crisis of the late 2000s and before that US manufacturing\u2019s migration to lower labour cost countries, saw sawn hardwood output slump. It has since recovered, but is still 4.2 billion bd ft below 1999\u2019s 12.6 billion peak.<\/p>\n

At the same time, reflecting decline in domestic construction and hardwood manufacturing demand, mills have refocused on industrial lumber for the US market and grade exports. \u201cIn 2005 grade lumber accounted for 59.7% of US output, today that\u2019s 48%,\u201d said Mr Snow. \u201cMoreover, 45% of it is now exported and rising, compared to 17% in 2000.\u201d<\/p>\n

China\u2019s role in this evolution has been central, accounting for all US sawn hardwood export growth since 1992, and today buying 25% of the boards America produces. US exports to China have grown particularly rapidly since the international economic crisis, thanks to the potent combination of contraction in the American domestic market and the rise of China\u2019s new middle class, firing growth in its domestic consumption. \u201cIn 2000 85% of our exports to China were re-exported as finished goods,\u201d said Mr Snow. \u201cToday 80% goes into products for its domestic market.\u201d<\/p>\n

Asked which country will be the \u2018next China\u2019, Mr Snow\u2019s response is China thanks to accelerating development of its less industrialised western regions. US mills see this as a further lumber market opportunity, however, their growing concern is the accompanying rise in China\u2019s log imports. \u201cSo far logs have gone mainly to finished goods makers processing timber for their requirements,\u201d said Mr Snow. \u201cThe concern now is emergence of Chinese mills cutting US logs for the general market.\u201d<\/p>\n

Europe in focus: shrinking market and raw material issues<\/strong><\/p>\n

The European market described by ETTF and EOS Presidents\u00a0Andreas von M\u00f6ller<\/strong>\u00a0and\u00a0Nicolae Tucunel<\/strong>\u00a0is also a blend of challenge and opportunity. Mr von Moller described the EU\u2019s shrinking tropical timber business \u2013 with total imports down from 8 million m3 in 2000 to 2 million m3 in 2014 \u2013 as\u00a0 \u2018sad\u2019. It was partly due, he said, to the recession, but market misconceptions about its environmental credentials also contributed.<\/p>\n

While renewed effort was needed to halt this trend, however there were overall European hardwood market positives, notably broad economic and construction recovery. While the UK\u2019s outlook may look uncertain due to Brexit, most European economies, and importantly their construction industries, were growing. So far this had led only to hardwood market stability since 2013. \u201cBut after recession, stability is not a bad thing,\u201d said Mr von M\u00f6ller.<\/p>\n

Mr Tucunel reported forecast 2017 total European hardwood production at 10.8 million m3, imports at 3.4 million, exports 5.7 million and consumption 8.6 million, all roughly on a level with 2016 figures. Turning to his own country Romania, Mr Tucunel said it remained a leading European hardwood producer, with annual sawn output of 1.7 million m3. But its private sector mills were increasingly hindered by raw material availability due to a harvest decrease from 19 million m3 to 17 million m3, caused in part by \u201cexcessive\u201d NGO-driven environmental legislation\u201d. \u201cThis has led to mills restricting output, even closing,\u201d said Mr Tucunel.<\/p>\n

Legality regulation and trade regionalization: Tropical timber imports swing to emerging countries<\/strong><\/p>\n

Raw material availability and distribution also formed a core theme for\u00a0Davide Pettenella<\/strong>\u00a0of Padua University.\u00a0 He addressed whether national and regional timber legality controls were creating a \u2018dual market\u2019 for tropical timber.<\/p>\n

His study compared trends in primary tropical timber product imports by EU states, the USA and Australia, representing developed countries with strict timber market legality regulation, and China, Vietnam and India representing emerging consumers with lighter controls. This highlighted import swings to the latter. In 2001 of all tropical timber imported by these countries, the developed economies accounted for 63% by volume and 72% by value, the emerging countries for 37% and 28%. Today the respective division is 44% and 47% and 56% and 53%.<\/p>\n

While legality controls may be implicated in this trend, Mr Pettenella said it was not the exclusive factor. \u201cEmerging countries\u2019 economic development and increasing south-south trade are also involved,\u201d he said. In fact, his conclusion was that the trade trend influencer to monitor was the latter and other intra-regional trade growth. \u201cIt\u2019s a phenomenon which should be of concern to policy makers,\u201d said Mr Pettenella. \u201cIn 1990, there were just 20 regional trade agreements. Today there are 283.\u201d<\/p>\n

Looking at future forest product supply and flows, consultant\u00a0Pierre Desclos<\/strong>\u00a0concluded that rising population could also boost intra regional consumption. \u201cFor instance, Africa has 15% of the world\u2019s forests, but it\u2019s forecast to have a third of its population by 2100, so will be consuming most of its own timber.\u201d He agreed that this will increase pressure on the timber industry to both manage the forest resource more sustainably and use wood to its full potential.<\/p>\n

New hardwood applications<\/strong><\/p>\n

Head of the European Hardwood Innovation Alliance\u00a0Andreas Kleinschmit von Lengefeld<\/strong>\u00a0described the role of his organization in this. \u201cWorking closely with the industry, we're evaluating the potential outcomes of research into areas ranging from forest management systems, to development of new cellulose fibres, and hardwood in smart buildings,\u201d he said.<\/p>\n

David Venables<\/strong>\u00a0from AHEC took the topic further, describing US hardwood innovation now gaining market traction. The massive American white oak glulam beams at the Lords Cricket Ground were one example. Perhaps even more significant was development of tulipwood cross laminated timber for structural application. The material first formed the core structure of two global headline grabbing AHEC showcase projects at the London Design Festival; Endless Stair and The Smile. Subsequently the same material was used in a cancer care centre in northern England, the first permanent building constructed in hardwood CLT.<\/p>\n

\u201cArchitects and engineers are increasingly convinced of hardwood\u2019s structural potential \u2013 in fact they\u2019re our best ambassadors for it,\u201d said Mr Venables, \u201cAnd global CLT production is set to hit 1 million m3 next year. Softwood dominates the sector, but imagine if hardwood took just a small percentage!\u201d<\/p>\n

Branding initiatives: Rising awareness for hardwood through market value as well as beauty and performance<\/strong><\/p>\n

Meanwhile Fair & Precious, explained\u00a0Benoit Jobb\u00e9-Duval<\/strong>\u00a0from ATIBT, was a potentially powerful new tool to raise awareness and increase marketability of sustainably sourced tropical hardwood. The brand, commits users across the supply chain to verified sustainability and corporate social responsibility goals in procurement. \u201cThe aim is to advance hardwood sustainability by enhancing its market value,\u201d said Mr Jobb\u00e9-Duval.<\/p>\n

Hardwood\u2019s other new branding exercise, Riva\u2019s collaboration with Lamborghini, centres on beauty and performance. \u201cIt works because we share a passion for quality and design and a commitment to using the finest raw materials,\u201d said\u00a0Maurizio Riva<\/strong>.<\/p>\n

On another upbeat note,\u00a0Elvio Florian<\/strong>, Chief Executive of Italian hardwood producer and IHC sponsor Florian Legno, described how through an integrated production line approach, timber companies in developed economies can survive and prosper. Started in 1950, his business now comprises 16 companies, employs 900 people and processes 300,000 m3 of timber annually.<\/p>","protected":false},"excerpt":{"rendered":"

On 15 and 16 November 2017 the International Hardwood Conference took place in Venice. 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