20 | Country Market Update: Ireland
◄ the same process and these are not being issued fast enough, so even if Coillte has the necessary felling licence, in some cases it’s not able to access the site.
A third hold up of volume is the 28-day
window, during which licences that have been issued can still be appealed. “We have 600,000m3
-700,000m3 of volume
tied up for various reasons,” said Coillte’s spokesperson, speaking at the end of March. 2020 was a year of disrupted schedules and Coillte’s business model is described as “hand to mouth – as you get it, it goes out”. “We normally have at least one auction and our annual contract event just before Christmas but we weren’t able to run that in its normal form last year because we just didn’t have the volume,” said the spokesperson. “So we split it into two events. One was before Christmas where we sold harvested material and one was in February where we sold standing material.” Coillte normally holds 10 auctions a year and at the time of writing, was planning to restart these in April, with a view to holding six this year.
The state forestry company supplied 19% less to the market last year than in 2019 and predicting its 2021 total is impossible. “We certainly have enough licencing to get about a million m3
across the weighbridge at
the moment but how much more we are able to do this year depends on the availability coming back. Our normal programme would be 1.65-1.7 million m3
.”
Coillte’s chief executive, Imelda Hurley, has gone on record as saying it will take all of 2021 to get its business back to normal operations. “I would look to 2022 as the year when we’ll be building back up and really getting on with the business that we run on a daily basis,” she said, speaking to the Irish Times in March.
This situation is replicated in the private
sector of course and much of that doesn’t have Coillte’s resources – or, perhaps, its clout with the Department of Agriculture, Food and the Marine (DAFM), with which the blame squarely lies.
The view is that those private growers who have mature assets that they would like to liquidise and who have felling licences would be keen to come to the market because log prices are so high and end markets are extremely buoyant.
But for those at the beginning of the growing and licencing journey, it’s a different story. The current situation has shaken people’s confidence and planting figures are down substantially.
“One of the things that is so disturbing is that planting is at such a low level,” said a major sawmiller. “Just 2,400ha, which is 57% down on 2017 and the government’s own target of 8,000ha. The whole thing is a mess.” The reaction from sawmillers is mixed – for example, one fencing and pallet specialist said phlegmatically “we still have this problem with felling licenses but logs are still coming and it will get sorted”, while others refer to the situation variously as “catastrophic”, “frustrating”, “a saga in itself” and “a shambles”.
“It’s as though everyone sat around a table and said ‘things are going grand around here, how are we going to mess things up?’” said one contact, expressing the exasperation of many. However, they are all united in the view that this too shall pass and that nothing will stand in the way of their commitment to supplying the UK market.
Some have supplemented their log supply from outside of Ireland.
“In the second half of last year we survived by upping our intake of logs from Scotland,” said a major sawmiller. “We are paying dear for every bit of private material we can get.”
Others say they have never imported roundwood. “All the timber we buy is from the island of Ireland,” said a major sawmiller. “Log supply was tight in the second half of 2020 but we were lucky to be in a good stock position. We identified a lot of private material – the log price went up, people started to sell and we were able to take advantage of that. Being bold in our procurement has left us in a strong position.
“The whole thing about the felling licence issue is that if it wasn’t cut last year, it’s still there to come forward. It might be delayed for a year but at some stage it will be licenced.” Another major primary processor said they had looked at importing but “the costs were prohibitive”. “We are fortunate that the contracts we had
have kept us in good stead,” said the contact. “It is a bit better than hand-to-mouth, so we have sufficient supply. But meaningful planning is being very badly disrupted and in terms of efficiency it’s not working. A very minor cock-up could create a shortage.” Log prices have been very high, of course, but some of that pain is mitigated by sawn prices, the likes of which have never been witnessed before. “We have been in a kind of market bubble,” said one commentator. “Obviously we’ve had supply constraints in Ireland but there is a shortage of timber globally. The US prices are the highest they’ve ever been, China has massive demand and what that means is that importers into the UK have an opportunity to direct their supply elsewhere. The market prices Ireland’s sawmills are receiving are at their highest level.”
This is also impacting those mills importing sawn timber, of course. “Sawn prices are moving up, particularly with German imports,” said one fencing and pallet wood specialist. “We’re trying to buy imported
Above left: Mills are finding log supply difficult, but they are coping Above right: Demand is strong and mills are working flat out TTJ | May/June 2021 |
www.ttjonline.com
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