{"id":77045,"date":"2019-02-08T11:59:30","date_gmt":"2019-02-08T11:59:30","guid":{"rendered":"https:\/\/tin.happy-projects.ro\/hardwood-trade-in-the-eu-keeps-stable-despite-reluctant-political-situation\/"},"modified":"2025-09-19T08:49:51","modified_gmt":"2025-09-19T08:49:51","slug":"hardwood-trade-in-the-eu-keeps-stable-despite-reluctant-political-situation","status":"publish","type":"post","link":"https:\/\/www.timberindustrynews.com\/ro\/hardwood-trade-in-the-eu-keeps-stable-despite-reluctant-political-situation\/","title":{"rendered":"Hardwood trade in the EU keeps stable, despite reluctant political situation"},"content":{"rendered":"

There are signs that the upturn in the eurozone economy in the last 2 years will be short-lived and growth is stagnating again. Meanwhile, the trade war between USA and China has stirred fears of a new global recession and EU countries are anxiously awaiting the outcome of Brexit negotiations with the UK. None of which is good for market stability.<\/em><\/span><\/p>\n

The latest economic forecasts suggest that the eurozone will be marked by significantly lower growth in 2019. An FT survey of 24 economists at the end of last year, gave forecasts of eurozone GDP growth across a wide range, from 0% to 3%, a sign of the high level of uncertainty.<\/p>\n

The majority forecast eurozone growth close to the middle of this range, at around 1.5%.<\/p>\n

With signs that economic growth slowed at the end of last year, IMF forecasts issued in January 2019 suggest that growth in Germany will slump to 1.3% in 2019, down from their 1.9% forecast in October. Italy\u2019s GDP is now forecast to grow only 0.6% in 2019, down from the previous IMF forecast of 1%.<\/p>\n

The IMF is now slightly more optimistic about the UK economy, forecasting growth of 1.5% in 2019, 0.1% higher than the October forecast, but this is dependent on the UK securing an agreement to leave the EU. Brexit aside, the UK economy appeared to be in quite good shape at the end of last year.<\/p>\n

Employment is at historically high levels, and wages have been rising which should prop up consumer spending at least for a time. However, indicators show that UK consumer and business sentiment dipped in December amid heightened Brexit uncertainties.<\/p>\n

Despite these rather ominous signals, the hardwood sector in the EU continues, for now, at a steady, albeit slow, rate.<\/p>\n

To some extent this is merely a reflection of industry structure. Compared to the softwood sector, which deals in large volumes with rapid stock turnover, the hardwood sector is a small volume business with very long lead times, particularly for tropical products. Much of the product is used in high-value, often bespoke, applications, which are irregular and difficult to forecast.<\/p>\n

In these circumstances, hardwood traders are naturally cautious about building stock, extremely wary of being caught out by currency fluctuations, and inclined to focus on a limited number of well-known and favoured species which have traditionally offered the best margins.<\/p>\n

It maybe that significant change is just around the corner, or already underway, driven by larger social and political forces. But this is taking time to filter through into readily observable trends in a highly conservative industry.<\/p>\n

Feedback from EU hardwood importers suggests that African supply has become more stable in recent weeks, with fewer hold-ups at the Cameroon port of Douala. This may be partly due to a recent slowdown in Chinese demand, helping to free up shipments to Europe.<\/p>\n

UK importers report that their imports of Malaysian meranti and keruing are currently constrained by limited supply of the PEFC certified material preferred for EUTR conformance and other green procurement requirements.<\/p>\n

Despite FLEGT licensing, there are no clear indications yet of any significant rise in European trade in bangkirai decking and other solid hardwood products from Indonesia, with traders suggesting that FLEGT-licenses have yet to achieve any real market traction.<\/p>\n

Some companies and trade associations, notably in the UK, are now more regularly flagging up Indonesia\u2019s FLEGT status. Research by the FLEGT Independent Market Monitor (IMM)also suggests good awareness in the European trade that FLEGT licenses, which require no further due diligence under the terms of EUTR, greatly simplify and reduce the costs of conformance to the regulation<\/p>\n

However, there remains a need for more effective market development efforts for FLEGT licensed products which are less dependent on \u201cavoiding a negative\u201d (i.e. EUTR sanctions and links to illegal logging) and instead emphasise positive messages and commercial benefits.<\/p>\n

The European Forestry Institute, which manages the EU FLEGT facility, is contributing to this more positive approach with the launch of a new online resource to help timber buyers to communicate the FLEGT scheme to their own customers at\u00a0www.timberbuyers.flegtlicence.org<\/a><\/p>\n

This is a start, but traders are advising that policy-led communication initiatives of this type, in isolation, will be insufficient to drive any real transformation in the European market towards FLEGT licensed products, or to encourage greater engagement with the tropical timber industry.<\/p>\n

A more pressing challenge is to ensure importers and their customers have strong commercial reasons to purchase the product on a regular basis. For this, they need assurances of likely long-term availability, competitive pricing and potential to achieve good margins, quality and technical performance, and delivery times, alongside assurances of legality and sustainability.<\/p>\n

In practice this highlights the need for more productspecific business-to-business market development efforts, based on solid data on supply and demand, targeting specific end-uses and niche markets, and ensuring conformance to customers\u2019 technical requirements. Messages about FLEGT may be integrated into this process, but cannot be the only, or even the leading, hook to drive market demand.<\/p>","protected":false},"excerpt":{"rendered":"

There are signs that the upturn in the eurozone economy in the last 2 years will be short-lived and growth is stagnating again. 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