The EU-Australia free trade agreement removes tariffs on timber and wood products, lowering the cost of European imports and reshaping competition in the Australian market.<\/p>\n
Australian Prime Minister Anthony Albanese and European Commission President Ursula von der Leyen signed the deal this week at Parliament House in Canberra this morning, concluding eight years of negotiations.<\/p>\n
One element welcomed by the sector is the absence of a requirement for Australia to align with the EU\u2019s deforestation framework, the EU Deforestation Regulation<\/span><\/span>. This avoids additional compliance costs and leaves regulatory settings between the two markets only partially aligned.<\/p>\n Australia will eliminate duties of around 5% on European timber, furniture and engineered wood products<\/strong>, including cross-laminated timber (CLT) and glulam. For European suppliers, the change is incremental but commercially relevant, improving price positioning in a market where they already have a foothold in higher-value construction segments.<\/p>\n Europe\u2019s role in engineered wood is well established. Austrian, German and Italian producers supply significant volumes into Australia, particularly for large-scale projects where technical specifications and supply consistency are decisive. The removal of tariffs is expected to support further penetration in these segments.<\/p>\n At the same time, the agreement has drawn criticism from the Australian Forest Products Association<\/span><\/span>, which said the tariff removal would add pressure to domestic manufacturers. It pointed to a combination of rising costs, a softer housing market and increasing import volumes<\/strong>, arguing that the deal strengthens the competitive position of imports at a sensitive point in the cycle.<\/p>\n The concern centres on price dynamics. Even relatively small tariff reductions can influence procurement decisions in construction, particularly for engineered wood products where imported supply chains are already established.<\/p>\n The agreement also intersects with Australia\u2019s $300m Timber Fibre Strategy<\/strong>, which aims to expand domestic processing and increase the production of higher-value wood products. The removal of tariffs introduces a competing force, potentially making it more difficult for domestic producers to scale, while also lowering input costs for downstream users.<\/p>\n From a trade perspective, the impact is likely to be asymmetric. European exports to Australia remain modest in absolute terms \u2014 for example, Austrian timber exports are measured in the tens of millions of euros \u2014 but are concentrated in segments where demand is growing. Tariff elimination improves access to those markets without fundamentally changing global supply structures.<\/p>","protected":false},"excerpt":{"rendered":"","protected":false},"author":1,"featured_media":98329,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"Default","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[5204],"tags":[],"class_list":["post-98328","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-daily-news"],"acf":[],"yoast_head":"\n