{"id":82938,"date":"2022-09-22T08:32:29","date_gmt":"2022-09-22T08:32:29","guid":{"rendered":"https:\/\/tin.happy-projects.ro\/polish-wood-industry-expected-face-market-slowdown-coming-quarters\/"},"modified":"2025-09-19T08:58:16","modified_gmt":"2025-09-19T08:58:16","slug":"polish-wood-industry-expected-face-market-slowdown-coming-quarters","status":"publish","type":"post","link":"https:\/\/www.timberindustrynews.com\/ro\/polish-wood-industry-expected-face-market-slowdown-coming-quarters\/","title":{"rendered":"Polish wood industry expected to face market slowdown in the coming quarters"},"content":{"rendered":"
\n

Poland's wood industry is one of those branches of domestic processing in which Polish producers have had tangible competitive advantages so far, evidently turning them into a business success.\u00a0Over the past decade, Poland has clearly increased its share both in EU production (from 5.8% to 7.4%) and exports (from 7.1% to 9.3%).\u00a0The dynamic development of the industry is also well reflected by the data on the increase in the number of entities operating in it.\u00a0Analysts at Bank Pekao SA write about the successes, key challenges and prospects of the Polish wood industry and how its representatives can react in these conditions.<\/p>\n

''For several years, we have noticed a marked acceleration in the export of wood products.\u00a0Currently, foreign sales account for nearly 40% of the industry's revenues, but due to the limited size of the Polish market, we believe that it will play an increasingly important role in the activities of domestic processors.\u00a0We are a large net exporter in this field - Poland had the third highest positive foreign trade balance in the European Union in 2021, after Sweden and Austria,''<\/em>\u00a0emphasizes Krzysztof Mr\u00f3wczy\u0144ski, manager of the sector analysis team at Bank Pekao SA, co-author of the report.<\/p>\n

Recent years have brought dynamic changes in the sector.\u00a0The negative impact of the pandemic turned out to be short-lived (visible only in its initial phase), and changes in consumer behavior (more frequent staying at home) were conducive to an excellent economic situation in the industry, especially during last year's economic recovery.\u00a0The increase in the value of wood production reached the astronomical pace of 36% y \/ y in 2021, and the data for the first half of this year confirmed the continuation of this trend.\u00a0However, a large part of the increase was determined by higher product prices, following the growing costs of obtaining wood raw material.<\/p>\n

The fact that until the end of the last quarter the high prices of wood products compensated their producers for the historically high costs of purchasing wood, is evidenced by the amazing financial results achieved over the last 1.5 years.\u00a0During this time, small, medium and large companies from this sector earned \"clean\" almost 40% more than in the total of 3 previous years (2018-2020).\u00a0Already in 2021, the industry improved its net profitability by nearly 5 percentage points y \/ y (the third strongest progress in all processing), to \"add\" another 1.3 percentage points in the first 6 months of 2022.\u00a0The Polish timber industry, as a supplier of many intermediate products to other sectors, thus maintained a strong bargaining position at the time.\u00a0''A factor that certainly contributed to such good results of the wood industry at that time was its skilful use of government aid as part of anti-crisis shields.\u00a0The industry received one of the largest payments of these funds among all processing industries, both in nominal terms and in relation to the revenues achieved,''<\/em>\u00a0adds Tomasz Tyc, Bank Pekao SA expert, co-author of the report.<\/p>\n

The title of the report suggests, however, that the situation of the industry may change dramatically in the coming quarters.\u00a0The authors of the study point to its deteriorating demand outlook.\u00a0''Wood products, which are largely consumer durable goods, as well as products used by industries that are currently very uphill, such as furniture and construction, are among the most threatened by the current economic downturn,''<\/em>\u00a0emphasizes Tomasz Tyc.<\/p>\n

In such circumstances, it may be more difficult for Polish timber companies to ease the current supply pressure.\u00a0This, in turn, is not weakening so far.\u00a0The barrier of raw material shortage in August was still indicated by about 1\/3 of wood processors surveyed by Poland's Central Statistical Office.\u00a0The record-breaking prices of timber are particularly challenging, additionally driven by the reduction of imports of key semi-finished products from the East (Belarus, Russia, Ukraine), but also from the industry point of view, changes in the timber distribution system by the State Forests National Forest Holding (an increase in the share of auctions via the e-timber platform) ).\u00a0The problem is exacerbated by the expected heating crisis, resulting in additional competition for the raw material.\u00a0The possibilities of obtaining wood from alternative directions are limited, and have recently deteriorated even further (the problem of wood availability is quite common throughout Europe).<\/p>\n

In such a situation, what can Poland's timber companies, or even more broadly, all market participants do?\u00a0Any measures to alleviate the current supply pressure are certainly desirable.\u00a0While the possibilities of increasing the domestic timber production by the State Forests are rather limited (for example due to environmental reasons and tightening EU regulations), producers could be relieved by stronger restrictions on the export of wood outside the country.\u00a0Export restrictions are already in place in many EU countries, while the current system facilitates access to timber for intermediaries who trade with global partners.\u00a0On the other hand, the industry, both in the short and long term, should look for solutions limiting their material consumption or maximizing the use of secondary raw material (derived from recycling).\u00a0There is still a potential for improvement in both areas, although in the second aspect it is also necessary to create optimal system conditions for this (including more favorable regulations).\u00a0The record-breaking financial surpluses generated in recent quarters should also be used by companies to increase investment optimizing operating costs (including building their own \"green\" energy sources, improving energy efficiency, or automating production).<\/p>\n

Analysts also point to some potential on the revenue side.\u00a0While Poland is already a significant global player when it comes to the export of wood products (including more advanced ones, such as windows or doors), its geographical structure is still uneven.\u00a0The position of Polish companies remains relatively weak even in some EU countries, not to mention numerous attractive non-EU markets.\u00a0Meanwhile, many of them have been successfully operated by competitors from Western Europe or even our region of Europe.\u00a0Among the export destinations with a particularly large and still not used business potential, the authors indicate, inter alia,\u00a0Asian markets, especially China, Japan and South Korea.<\/p>\n

An important aspect raised by the analysts of Bank Pekao SA is also the strength of the brand of Polish products.\u00a0''Analyzing the average unit prices obtained in exports, we notice significant disproportions between Poland and the largest Western European competitors.\u00a0As in other areas of Polish industry, domestic producers position themselves mainly as low-cost suppliers within European supply chains.\u00a0It is a long-term business model susceptible to possible cost pressure as well as increasing competition from companies from other countries (including our region).\u00a0In this model, it is also more difficult to conquer the markets of developing countries, where Western European suppliers operate mainly in the premium segment.\u00a0Such \"premiumization\" is, however, a long-term process that requires consistent development of other tools for competition than before<\/em>,''notes Krzysztof Mr\u00f3wczy\u0144ski.<\/p>\n<\/div>\n

<\/h2>","protected":false},"excerpt":{"rendered":"

Poland’s wood industry is one of those branches of domestic processing in which Polish producers have had tangible competitive advantages so far, evidently turning them into a business success.\u00a0Over the past decade, Poland has clearly increased its share both in … Continue reading →<\/span><\/a><\/p>","protected":false},"author":1,"featured_media":64331,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[4716,4715,4714],"tags":[3293,3655,4188],"class_list":["post-82938","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-latest-trends","category-market-analysis","category-wood-industry-prices","tag-poland","tag-wood-industry","tag-wood-prices","topic-forestry","topic-industry-prices","topic-sawmilling","area-north-america"],"acf":[],"yoast_head":"\nPolish wood industry expected to face market slowdown in the coming quarters - 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