Continuing price trends from mid-January, West African exporters have held all log prices unchanged through the end of January. Demand has not changed and buyers for China are maintaining their policy of purchasing a more
limited number of species. Indian demand remains firm for
belli, but at slightly lower prices than negotiated at the end
of 2007. There are signs of a revived interest in okan and it
is possible prices may recover from the recent lower levels
resulting from falling demand in the past year. Sipo and
sapele have held firmly to recent price gains for both logs
and lumber. Exporters are less nervous about more
competitive prices for Far East species. The early February
celebrations for the Chinese New Year will cause the
normal slow down in logging and sawmilling.
Consequently, there is unlikely to be any surge in
production until mid-February.
Although all traders are watching the global market
carefully, the full impact of the market seems not to have a
sharp bearing on the industry. The fall of U.S. housing
prices and house demand, together with a reported surplus
of unsold new-build housing in Spain, are affecting timber
markets. However, it does appear that the major impact of
the U.S. market is likely to be on South American and
Asian suppliers rather than on the lesser volume of trade
with West Africa. Freight rates are high and have not
changed after the moderate hikes in December 2007,
although this has not yet inhibited trade volumes. One
exporter recently noted some difficulty in obtaining
shipping space for Europe, although this seemed not to be
a significant problem.
As with logs, prices for sawn timber are unchanged from
mid-month levels. Although markets are still said to be
quiet, demand has remained moderate, possibly helped by
the mild winter conditions so far in Europe, where rain is
more of a problem for the construction sector than the
normal snow and ice. However, continental European and
UK buyers are being very cautious over concerns about
the full effects of the U.S. credit crunch. Sapele and sipo
are in demand and moabi also continues to be popular.
Okoume, douka/makore and movingui remained in good
demand and are unchanged at recent higher prices. While
there are no forecasts for the medium term, experts say
prices should remain stable at least until the end of
February.
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