Italy is experiencing a year of extremes with two completely different half years. The packaging industry never stood still completely because it was considered as “essential”. Nonetheless, sawn... Read more ...
Cutting in Central European sawmills was at a very high level in July as well. With the exception of those in the south of Austria, sawmills received sufficient log wood at further reduced prices. Buyers were easily found for the produced sawn timber. However, the accumulation of wood waste is starting to be of some concern.
Sawn timber production close to 2019
In Austria, production in sawmills could return to last year’s level by the end of August. In March and April, such a development was unimaginable. Since then, demand for sawn timber has increased considerably, and since June and July at the latest, orders from Italian customers are again at a very high level.
Boom on the German market and in the US
Sawn timber sales on the German market have so far been very good each month. In addition, the German sawmill industry is extremely competitive on the global market thanks to cheap log wood. One example is the country’s main export market, the US. In July, prices skyrocketed there. According to Holzkurier’s research, the average monthly price is nearly 300 €/m³ (2-by-4 SPF KD #2 and better free east of the US), which is almost 250 €/m³ free German sawmill. A similar level was reached during the record year 2018 – but is otherwise unprecedented.
Enough log wood after the summer holidays?
Fortunately, the month of July was wet and cool. Close to the Alps, this led to a considerable reduction in the accumulation of damaged wood. In the north of Austria, there is a noticeable discrepancy between the predicted and the actual volumes of damaged wood. In the south, there is already a scramble for these quantities of fresh log wood with bigger batches. Market participants are already eager to know what log purchases will be like from the third week of August after the seasonal down times.
As with log wood, prices again saw a slight decrease in July. In the greater region of Southern Germany and Austria, the regular price level for spruce/fir logs B, 2b ranges from 50 to 70 €/m³.
With orders again coming in from Italy, the situation slightly improved when it comes to sideboards. However, prices – for example those of 17 mm sideboards from chipper lines – were still considerably lower in July as well. Stock levels in sawmills did fall slightly, though.
In July, an uninterrupted demand for glulam has led to delivery times of two to six weeks in Central Europe. Producers stated that they want to try to create a “minimal stock level” in the holiday month of August. Realistically, however, part of the demand could be the result of pull-forward effects.
CLT producers are currently able to deliver on shorter notice which is unusual. This development is mainly due to three factors: New productions have been started up, COVID-19 put a temporary stop to many overseas projects and in the DACH region several big projects are currently on hold as well.