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At present, many parts of the world are still suffering from epidemics and natural disasters. Even if the corresponding measures of various countries are introduced, it is still difficult to solve the problem of timber supply and demand in the short term.

Since hitting a record high in mid-2021, timber prices have ushered in a round of rapid adjustments. Timber futures prices have now fallen to the ** level in the past seven months, and the price has fallen by about 68% from the peak, indicating an overall strength. The rising market is over.

Softwood

Softwood: It is expected that the domestic timber savings supply will be relatively stable in the next one to two years.

1. Pests, extreme weather

In recent years, countries in central Europe have been fighting against pests. In the past two years, the number of trees damaged by pests has increased by nearly six times, and the output of wood has been severely affected.

Recently, many places in Europe have encountered heavy rains and floods, and timber logging and transportation are facing great difficulties. It is expected that the output in the next few years will decrease compared with previous years.

2. Russia's restructuring of the timber industry affects supply

In order to optimize and upgrade the timber industry chain, improve the long-term competitiveness of the forest industry, and achieve a balanced development of the environment and economy, Russia, my country’s important timber importer, will ban the export of unprocessed or rough processed needles from January 1, 2022 Logs and precious hardwood lumber. This move is bound to cause the cost of timber imports to rise.

3. Relatively stable supply

The China-Europe Express has opened more than 70 routes, and the timber trains from Chengdu, Ganzhou, Lanzhou and other places continue to transport coniferous materials for export from European countries to the country. Compared with the continuous congestion of shipping, the time cost of importing timber on the train has been greatly reduced, and the supply is more stable.

4. Foreign trade is proceeding steadily

Statistics show that from January to June this year, the trade volume between China and ASEAN reached US$41.76 billion, a year-on-year increase of 38.2%. Even during the epidemic, trade is still frequent. The “Belt and Road” initiative continues to drive the economic recovery of countries along the route, and it also provides a guarantee for the stable supply of timber.

Hardwood:

1. South Africa transportation is suspended

The recent riots in South Africa have continued to escalate. Affected by this incident, South Africa's imports and exports were interrupted, and the timber supply chain faced great obstacles.

On July 26, South Africa's state-owned logistics company stated that the IT system of its main port terminal suffered a major cyber attack nearly a week ago, and the flow of containers has actually stopped. The supply chain that had just started up was hit again.

2. Supply in the Americas is difficult to guarantee

The high temperatures in western North America continue to spread and wildfires are raging. The harvesting progress is slow and the timber is difficult to supply normally. At the moment when demand is strong, we can only rely on inventory for work.

The severe drought in South America hindered the growth of timber; severe water shortages caused the river's water level to drop. In order to avoid stranding, cargo ships could only reduce the cargo capacity, which greatly increased the cost.

3. The epidemic situation in Southeast Asia has intensified

In the past week, confirmed cases in Southeast Asia have increased by 41%, new cases have exceeded 500,000, and deaths have also increased by 39%, making it the region with the fastest increase in deaths in the world. Many industries have cut and stopped production, and there is a serious shortage of labor.

Epidemics at Myanmar border ports are repeated, and epidemic prevention and control are difficult. The opening hours of the ports are intermittent. Imported wood can only be imported in detours, which consumes a lot of money and time.

According to a study published by itto, the use of global timber resources will double by 2050. At present, the problems of difficulty in booking space, high freight rates, and substantial increase in operating costs of foreign trade companies have not been resolved. Container freight rates show that the global supply chain has not yet reached its most severe time.

In the short term, timber prices will continue to fluctuate due to the influence of supply and transportation. The domestic market is currently in the off-season, and the demand is not strong. The reduction in supply will have little impact on the country.

In the medium and long term, the difficulty of balancing the supply and demand of timber will still be a problem that countries all over the world need to solve.