“Log wood is getting more and more expensive and yet only small volumes are arriving from the forests.” This is the comment of a frustrated buyer who describes the current supply situation as “relatively tense”. Several large sawmills have become extremely cautious in purchasing – and struggle to receive the minimum they need. Large sawmills in the west of Austria are willing to pay an additional €10/m³ in Bavaria and buy the log wood for €103/m³ free forest road.
Lower-cost imports from the Czech Republic, for example, are hardly possible for German and Austrian sawmills, since prices there start on average at €115/m³ for fresh spruce/fir logs. Other trade flows have even seen an inversion. For example, Swedish pulp producers are reportedly making inquiries for German industrial log wood, because supply is too scarce and prices are too high in Sweden.
Stable market situation without dynamic demand
In October, log prices increased by 4% in southern Germany and by 2% in Austria. Lumber prices, on the other hand, rose by only 1 to 2%. “The situation remained stable – but there is no dynamic when it comes to lumber”, one market participant commented. “That won’t change until the end of the year. I think that big increases in volumes are unlikely.”
Cutting at too high a level?
Given the current demand, cutting volumes are still a little bit too big. Sawmills, which are located close to areas where little damaged wood is accumulating, could offer even lower prices. “Nearly everything is available in sufficient quantities,” a timber traded added.
