France: Boom in demand for sawn softwood

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Boom in demand for sawn softwood  

As long as it lasts! In the softwood forests of eastern France, sawyers are crossing their fingers because the sawnwood markets are enjoying unprecedented enthusiasm. “We are inundated with requests in all species and in all qualities,” confirms Jurassian Gilles Grandpierre. In fact, processors benefit from a combination of exceptionally favorable factors. And we must undoubtedly go back several decades to have known such an euphoric situation.

On the one hand, due to windfall in Europe in 2018-2019 (Central Europe, Austria, Italy, etc.) and the bark beetle crisis, the lumber yards in factories were inundated with logs. Fatally, the purchase prices of firs and spruces in the forest have fallen significantly in two years. Dry products approached zero while green timber prices fell 20% to 30% until the end of 2020.

On the other hand, the Covid 19 epidemic has overturned all economic theorems. It followed a cascade of consequences that were unimaginable just a short time ago: breakdown in supply chains, zero stocks, inflation in sea freight rates, strong recovery in China, construction boom in the United States and exponential rise in prices. sawnwood, panels, pulp, European exporters abandoning the French market .

The sudden recovery in demand, occurring after a very sudden shutdown of the production, causes a shortage of materials, extended delivery times and price conditions that are constantly revised upwards and not guaranteed. Thus, since the beginning of 2021, the tariffs of imported gluing wood have jumped by at least 60%. Those of the battens took almost 50%. The progress is also spectacular for the low qualities intended for packaging.

The new element in recent weeks is a very dynamic demand for green timber from sawyers. This mechanically translates into a clear increase in timber prices in the forest (see tables 1 and 2 below). Thus, at ONF sales in the Jura massif, spruce logs which were worth standing and on average 58 euros / m3 (price under bark) in the fall of 2020 are now negotiated on the basis of 65 euros / m3.

The average increase, which is around 12% in 8 months for spruce, appears a little less pronounced for fir (ie + 8%). At average prices, the fir trees now start on the stalk at 56 euros / m3 under bark, against 52 euros / m3 in September 2020. In wood shaped roadside, the most beautiful lots of spruce reach almost 100 euros / m3, those in fir trees slightly exceed 90 euros / m3.

In the short term, the climate of euphoria in which softwood sawyers bathe should continue at least until the end of summer. The construction site season is in full swing and many sawmills will close a few weeks for the August vacation. "Our order books are full until the end of September and we expect to revalue our structural prices upwards soon" , a sawyer told us. For the rest, nothing is certain. Some professionals qualify the activity of the moment as an artificial bubble, the lifespan of which no one can predict today.

Table 1:

          RESTART OF SPRUCE RATES IN THE EAST

          Price in euros / m3 under bark and standing

            At the ONF Bourgogne-Franche-Comté public sales     

Volume

Q3 2019

Q3 2020

Q2 2021

Evolution

Q3 2020 / Q2 2021

Evolution

Q3 2019 / Q2 2021

1 m3-1,49 m3

45.5

50.1

52.4

+ 4.6%

+ 15.2%

1,50 m3-1,99 m3

63.2

58.9

55.2

-6.3%

-12.7%

2 m3-2,99 m3

70.2

55.7

64.6

+ 16%

-8%

3 m3 et +

72.2

56.4

74.7

+ 32.4%

+ 3.5%

Average price

63.9

58.3

65.5

+ 12.3%

+ 2.5%

Sources: Robert Wood, after Resineux de Franche-Comté

 

Table2:

IN THE MASSIF JURASSIEN, REVALORIZATION OF THE FIR

          Price in euros / m3 under bark and standing

          At the ONF Bourgogne-Franche-Comté public sales

Volume

Q3 2019

Q3 2020

Q2 2021

      Evolution

Q3 2020 / Q2 2021

Evolution

Q3 2019 / Q2 2021

1 m3-1,49 m3

35

43.4

45

+ 3.7%

+ 28.6%

1,50 m3-1,99 m3

47.7

46

50.3

+ 9.3%

+ 5.5%

2 m3-2,99 m3

53.4

49

53.4

+ 9%

  0%

3 m3 et +

59.9

52.5

51.4

-2.1%

-14.2%

Average price

54.7

51.8

55.1

+ 6.4%

+ 0.7%

Sources: Robert Wood, after Resineux de Franche-Comté

 

 

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