At the beginning of the year, 80% of timber construction companies expected the share of timber constructions in the overall construction volume to continue to grow in the coming years. This assessment has hardly changed since Holzkurier’s economic survey of the timber construction sector was launched three years ago – until now. In Holzkurier’s most recent survey at the end of the first quarter, only half of the respondents expect an increase in the share of timber constructions. 27% believe that it is going to remain unchanged and 16% even expect it to decrease – despite a generally positive order situation. 75% of timber construction companies report a “good” order situation in the first quarter and 25% describe it as “satisfactory”. Furthermore, 82% of the respondents do not expect the situation to change in the current quarter.
Growing discontent among timber construction companies
It is mostly the massive price jumps in recent weeks and months as well as ever longer delivery times which are giving many timber construction companies headaches. The attractive lumber exports to the US are often seen as the main cause for this.
Numerous market participants voiced their discontent about this in the economic survey and even predicted that the entire timber construction sector would come to a standstill in a few months – unless something changed soon.
Due to the sudden increases in purchase prices, it is nearly impossible to make binding offers to end customers. The timber construction sector criticizes that this will damage the positive image of modern timber construction in the long run, an image which the sector has worked hard on creating in recent years. As for the current quarter, 91% expect a further increase in prices for timber construction products.
The great majority of sawmills (89%) expect further increases in prices as well. In an interview for holzkurier.tv, Markus Schmölzer, the new President of the Austrian sawmill industry, sees the jump in demand and the more challenging raw material supply as the main factors for rising prices. He underlines that lumber exports have decreased lately which he attributes to increased processing and growing sales in Austria. He also highlights that only 4% of overall Austrian lumber exports have the US as destination. Therefore, it is a myth that US exports are mainly responsible for an insufficient supply of the domestic market. In 2020, a total of 250,000 m³ were shipped to the US. In comparison, Germany exported 1.9 million m³ to the US last year, i.e. 20% of its overall softwood lumber exports.
Sales continue to grow
Sawmills’ assessments of their business situation in the past quarter have never been more positive (since Holzkurier’s economic survey was launched six years ago). 100% of the respondents described their business situation as either “good” (76%) or at least “satisfactory” (24%). As to the current quarter, 63% expect a “positive” and 30% a “satisfactory” development of this global sentiment variable. Only 4% predict a “negative” development. A similar picture emerges when one looks at sales expectations: 61% of the sawmills expect “increasing” sales, 37% think that they will remain “constant” and 2% expect “decreasing” sales in the current quarter.
The question regarding the sawmill industry’s willingness to invest yielded another record value. 63% of the respondents rated the willingness to invest as “high” and 28% as “stable”. 7% described it as “low”. Holzkurier identified 50 investment projects of the sawmill and processing industry which are to be realized in the DACH region and the Czech Republic by 2022.
