The downturn in the timber sector in Malaysia, Mexico and other timber-producing countries showed signs of easing in November, according to the latest edition of the Global Timber Index (GTI) Report, released today.

The ITTO-supported GTI Report tracks the timber sector in seven pilot countries, comprising China (the dominant tropical timber consumer) and six major tropical-timber-producing countries—Brazil, the Congo, Gabon, Indonesia, Malaysia and Mexico. The GTIs of the six producer countries were all below the threshold of 50% in November, indicating decline in the sector, but values increased for all these countries compared with the previous month, indicating that the downward trend of the timber sector in the six countries has eased. The biggest turnaround was in Malaysia, with the index increasing by 9.9 percentage points, followed by Mexico (+5.9 percentage points) and Gabon (+4.6 percentage points).

November is typically the peak season for China’s timber market, and market demand and supply both increased in the country, compared with October.

GTI-participating enterprises also provided updates on the timber sector in their countries. For example, Brazilian enterprises reported that rain had greatly affected transportation. For some enterprises, this meant a failure to make on-time deliveries to customers; on the other hand, the reduced supply of logs caused by the disruption had increased demand for logs, although this did not necessarily translate to greater profitability in wood production and manufacturing. Gabonese and Indonesian enterprises referred to the high price of fuel oil (e.g. diesel), which had increased production costs. Some enterprises in Mexico reported stagnant production due to insufficient transportation capacity and thus the slow shipping of logs from forests to sawmills. Indonesian enterprises noted that, despite low log prices, buyer requirements for products remained strict (super quality and Forest Stewardship Council-certified); some enterprises were calling for incentives for wood and wood products sourced from sustainably managed or legal forests.

Source: ITTO