OPERATION FOCUS ISSUE 23 AUGUST/SEPTEMBER 2011
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Editorial Director John Chadwick
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Chris Cann
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Editorial Board Dr Patrick Moore – Chairman and Chief Scientist of Greenspirit (Canada)
Darren Oldham – Managing Director Söderhamn Eriksson (UK)
Allan Hansard – Chief Executive of the National Association of Forest Industries (Australia)
Professor Piotr Paschalis-Jakubowicz – Warsaw Agricultural University (Poland)
Andre de Freitas Forest Stewardship Council Head of Operations
Eduardo Morales South American Forestry Consultant
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2 International Forest Industries | AUGUST/SEPTEMBER 2011
EDITOR’S COMMENT A whole new world
industries, in fact. The climb out of recession has been slow but, up until recently, it has been purposeful. Figures in the pages of the World Markets section, within this magazine, have increasingly told of rising roundwood prices, and sawnwood prices to a lesser extent, throughout much of the world. Machines sales have been improving as a result.
T
In this edition of International Forest Industries we report average sales figures from one of the world’s biggest cut-to- length suppliers, Ponsse, but at the same time were impressed by an order book that has almost doubled. Spanish lifting and loading specialist Ausa has reported strong turnover figures along with a fatter order book, indicating a healthy future outlook in the near-term at least. Importantly, both companies have
increased the percentage of international business on their books. This is consistent with reports we’ve received from many companies across the world who have continued to be successful during difficult times and have started to thrive as things have improved. It has been the ability to diversify away from stagnating markets, spread risk and shift focus between performing and underperforming regions/currencies that have proved the ingredients for a healthy margin. I write of this evolving market dynamic
as we – as an industry concerned with construction and growth – prepare for another possible recession that could test the new business models of many. The US and Europe have been crippled by poor wealth management to the point where another lending crisis looms. Meanwhile, BRIC nations, led by the Chinese, are slowing in their advance and seem less likely to be able to stimulate a way out of another downturn. Markets are responding by selling anything not nailed down.
he last few years have been a tough period for the forestry community. It has been a tough period for most
If the move into
emerging markets and general diversification was strong after the 2008 crash, it will be manic should a second recession eventuate.
Of course nothing is decided. China is always opaque and we won’t get a true idea of global financials until the Western world gets back from its summer holidays. All that is certain is that we are entering another period of uncertainty. Our recent coverage of Brazil seems
increasingly prescient in this light. Eucalyptus is a growing sector and happens to be the stock tree of many developing forest industries, such as those in Brazil and South Africa, where opportunities abound. This year’s Expoforest in Brazil – focused on eucalyptus – returned easily its best numbers since the show was introduced, meanwhile North American investment groups are snapping up eucalyptus farms across Australia. My point: what at the start of this year was a move to capture a larger share of a growth opportunity may turn out to be insurance against another fall in demand from traditional addresses. For now, the world is still turning and that will not change. Neither will the basic need for wood in our construction, pulp and energy industries. The recession in 2008 was a shock and pointed out deficiencies in many businesses – some of which were exploited to the point of their demise, while others have become tighter, more savvy operations. What is left is an industry ready to cope with another downturn.
Whether that downturn comes and
what role the eucalyptus resources in developing markets will play remains to be seen.
Enjoy
Chris Cann Editor
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