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In early August, a 63,200-ton cargo ship Konya was unloading wood-based panels and other wood products at Tilbury Port (the main port of London) in the United Kingdom. This is the first timber that sailed from Malaysia Port Klang to London for many years. General cargo ship, this cargo ship has become a symbol of the times in the trade torrent, marking an unprecedented level of demand for wood in Europe.

The 21-year average construction growth rate of 19 countries in the European Union reached 3.8%, making the construction industry expected to return to the level of development before the epidemic by 2022. The governments of many European countries regard the construction industry as an important way for economic recovery. After the epidemic in 2020, they have increased fiscal expenditures for the construction industry to ensure that the economic losses caused by the epidemic can be made up in the construction industry.

European construction demand and home improvement market are generally considered to be the main factors for the current boom in the European wood-based panel market. Even if the current lockdown policy of the new crown epidemic is largely relaxed and the spread rate seems to be effectively controlled, a large number of people are still assigned to work at home. As a result, many people who live at home spend more property on improving and expanding their residences, and the resulting demand for wood is greatly increased.

However, the pressure of increasing global demand for wood has exacerbated the wood supply chain problems in many European countries due to the epidemic, and the price of wood-based panels has been rising in Europe. The high shipping price and the long cycle are just one of the challenges facing the European plywood import trade. A large number of empty containers were stacked in the ports of consumer countries, and the freight price rose 10 times or even higher at one time. To make matters worse, in the past three months, due to the further promotion of the government's economic stimulus measures, global consumption has further accelerated, leading to the problem of timber shortages in various countries' markets. The quarantine caused by the epidemic caused the production of many wood-based panel export areas in the world to still be restricted by the shortage of personnel, and the price of the product once soared by 30%.

In terms of sources of supply, Brazil, a major exporter of wood-based panels, has suffered serious domestic infections in the face of the continuous impact of the epidemic, and the wood industry has been severely affected. In addition to the huge demand for the construction market from the neighboring United States, this has led to the production of man-made panels in Brazil. Board prices rose accordingly. In the end, including the shipping costs from Brazil to Europe, more European timber buyers are targeting Asia.

Among the Asian wood-based panel exporting countries, the freight policy restricts Russia’s options for transshipping to Europe; Vietnam, the main exporter of Southeast Asian countries, faces the negative impact of the epidemic, and the timber industry is in a state of paralysis, unable to deliver on time; Indonesia faces even higher The problem of packing rate is not the best choice. In the end, China came to the fore in the eyes of European buyers.

China is the world's largest producer of wood-based panels, and its wood-based panel production capacity accounts for about half of the world's. At the end of 2020, there are more than 15,200 plywood manufacturers operating in China. In 2021, there will be about 2,000 other types of manufacturers entering the wood-based panel industry in supplementary equipment layout, and the wood-based panel industry is thriving in China. It is estimated that by the end of 2021, the total production capacity of plywood products will exceed 270 million cubic meters.

In the harassment of the epidemic, China has performed well in its defense and control of the epidemic, and its resilience has stood out among many economies. Due to excellent wood-based panel production capacity and strong epidemic prevention and control, it has become one of the few wood-based panel exporters in the world that can keep up with European demand. Delays in delivery time caused by shipping issues and rising raw materials have made Chinese manufacturers increasingly confident in the face of European businesses.

Faced with European buyers whose inventories have almost bottomed out, they prefer suppliers who can have sufficient purchase guarantees. Chinese suppliers can still require European buyers to pay in advance when the free on board (FOB) price rises by 15%-20%, so as to purchase raw materials in advance to ensure the production cycle.

On the one hand, the demand for overseas construction has soared, and on the other hand, under the situation of such tight international shipping, the detention costs caused by delayed delivery will lead to a significant increase in costs. The superposition of many factors allows China to obtain the bargaining power of the international wood-based panel market by relying on a strong manufacturing environment, which is favored by buyers from all sides. China's timber output is expected to increase by 10% in 2021, reaching 95 million cubic meters, of which plywood exports can reach 6 million tons.