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Report
from the UK
Domestic demand drives manufacturing up
The GDP grew faster in the second quarter of 2006 than in the past two
years but Britain¡¯s trade deficit in goods remained high. The underlying
picture was erratic, but exports and imports appeared to be growing at
similar rates. Manufacturing demand unexpectedly improved in August
according to the Confederation of British Industry (CBI), its best
performance for a year and a half. Domestic demand was the driving factor
as total exports remained level with July¡¯s figures. The CBI said firms
have
remained hopeful of passing more of their increasing production costs to
buyers.
House building rakes profits despite interest rate hike
Persimmon, UK¡¯s largest house builder, has reported strong profits and
said the recent interest rate rise had a negligible effect on the market.
Persimmon expects UK house prices to rise 3-4% next year. Home completions
rose more than 38% over last year to 8,226 units. This increase has come
about due to the inward immigration from Eastern Europe which has relieved
the shortage of craftsmen in the building trade. However, the UK
unemployment rose to the highest level in more than four years in July as
factories shed workers and migrants swelled the workforce, damping
speculation about further
interest rate increases.
TTF voices concern over ODA¡¯s FSC-only plan
UK¡¯s Olympic Delivery Authority¡¯s (ODA) has published a draft
sustainability principles and progress report, describing work progress
over ODA¡¯s proposed 12 sustainability objectives, which includes the
sourcing of environmental and socially responsible materials, the TTJ
informed. All contractors involved in construction work for the London¡¯s
2012 Olympics are expected to show how they meet these objectives.
John White, TTF chief executive, said the Federation fully supported
ODA¡¯s sustainability objectives but voiced concern that a FSC-only
approach might be taken with regard to certification. Mr. White said that,
recently, the Mayor of London published a supplementary planning guidance
highlighting FSC as the preferred standard for sourcing of wood products
in all new major developments in the capital. Mr. White added that with
this approach, authorities would not get all the wood needed for the
Olympics. Mr. White stressed that timber was the most sustainable building
material available and that its use
should be encouraged instead of being barred.
Mr. White added that the timber industry¡¯s Olympics strategy group,
which includes the TTF, TRADA, British Woodworking Federation, UK Timber
Frame Association, Wood for Good, ConFor and the Forestry Commission,
would be lobbying strongly to communicate timber¡¯s sustainability
credentials to the ODA. The ODA is expected to produce a detailed
sustainability strategy next year, which would include more details on its
material procurement policy.
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Report
from Netherlands
Timber end-users kept busy by active construction
Thanks to higher sales prices and active demand, some traders in the Netherlands had reached the same turnover
in value or volume by June equivalent to the whole 2005. Now that the summer holidays have come to an end,
end-users of various tropical timber species still have plenty of work as the building sector is expected to remain
dynamic throughout the remainder of the year and the first
half of 2007. Building activity has also been step up by the Dutch government. For instance, near The Hague, on the
grounds of a former naval airbase (Valkenburg), authorities are in preparations to build 5,000 housing units.
However, during the holiday period, demand from some retailers and end-users eased or came to a standstill. Some
importers managed to push through some sizeable orders/deliveries, so several end-users had no empty stock
position and, thus, were not in immediate need of timber. This has slow down somewhat the market. One of the
importers with excess unsold stock has offered few hundreds m3 of dark red meranti (drm) 3x5¡± at just below
euro1,000 per m3 but in combination with less saleable sizes. Other than that, current sales prices of drm 3x5¡± are well
over euro1,100 per m3 free delivered. In Malaysia, in turn, sawmillers are absolutely unwilling to lower sales prices,
which have held meranti CNF Rotterdam prices firm and even rising, despite the fact that Dutch importers were
mostly inactive in July and for most of August.
Dark red meranti still in short supply
Importers are now gradually coming back into the market and actively searching for fresh purchases, especially for
the key cross section 3x5¡± size. Traders are pretty optimistic about the outlook for the coming months, since this size is not abound for forward positions. The supply
of drm (including nemesu, seraya and particularly bukit) in Peninsular Malaysia is still characterized by scarce
availability. Light density material (tembaga) is sufficiently available but not suitable for the Dutch
market. The fact that the heavier types of drm are not in abundant supply and that exporters are offering limited
volumes for November/December shipments have prompted further purchases by Dutch
importers. Purchases are also pushed by short supply of Brazilian sapupira (Angelim pedra) and fresh arrivals of air-dried
sapelli requiring kiln drying.
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