| 21


Above left: The period of slower sales allowed the sawmills to replenish stocks Above right: Investment continues, but at a slower pace due to a less dynamic market


2020, and moved higher still in 2021. It will be interesting to see if we can continue gaining market share in the UK as the market situation stabilises.


For oak, the situation was worrying, especially during the first semester of 2023. Volumes were much lower than the previous year. In the second half, export sales regained momentum but remained under the previous year’s levels. For the year as a whole, total volumes of French oak lumber exports amounted to 196,900m3 23% compared with 2022.


, a drop of more than


lumber, although after hitting a record high of more than 75,000m3


were down 13% last year at 66,000m3


The UK is still our main customer for oak in 2022, volumes


. With


the exception of Thailand and Chile, all other export markets saw contraction. However, bearing in mind 2021 and 2022 were record years, it is perhaps not overly concerning to see the figures drop back. Prices had got extremely high, causing importers to withdraw their orders and stocks to build up in some products. In the beech market, the situation was quite good through the first trimester before turning down for the rest of the year. As a result, 2023 total exports were 8.5% below 2022 levels. Belgium remains our lead export market for beech lumber, despite a decline of 27% in 2023. Sales to China and Spain also slowed down considerably. French suppliers did, however, see demand grow from Algeria, Portugal, Tunisia and Vietnam and managed to gain market share. Beech exports to the UK tend to fluctuate between 300m3 1,000m3


and a year.


Other Asian markets for French hardwood went through a particularly difficult phase, with high inventory levels, resulting in very slow sales and a drastic reduction of imports – logs as well as sawn lumber. Oak log exports to China reduced by


45% last year after hitting a record level of 550,000m3


the previous year. Softwood


log exports were also down by 43%, while beech log exports declined by 23%. This drop in demand, however, is a breath of fresh air for some sawmills, who faced difficulty purchasing saw logs in the previous years. In some regions, the situation had become very concerning, with a more and more important part of the log harvest shipped abroad significantly impacting raw material availability for French producers. The outlook for the rest of 2024 is rather uncertain. A lot will depend on the capacity of the construction industry to regain momentum. The figures that we have for the year already show some improvement in the softwood sector, whereas hardwood sales continued to slow through the first trimester. Talking with producers at the Carrefour International du Bois exhibition in Nantes in May, however, most of them reported the situation was getting better, with sales picking up and more enquiries (see pp23-26). The furniture and doors sectors seem to be the first to get back to growth, although the flooring market remains rather slow. Interest rates are also getting lower, and the construction industry is starting to show some positive signs.


The price of logs remained around the same, despite market slow down, with the situation attributed to the strong rise in production costs, with electricity, labour and insurance all on the up. At the same time, wood chip and sawdust markets have turned down, with the result being squeezed sawmill margins. And it looks highly unlikely that sawn lumber prices will drop in the coming months.


Also, this year the harvesting conditions have been very difficult due to poor weather resulting in fewer logs reaching sawmills. That has further underpinned high prices.


Factors that could have positive impacts include the implementation of new legislation, notably the RE2020 environmental regulation, which is designed to increase use of eco- friendly building products in new public construction. Wood products in general are set to benefit from such measures, especially for lumber for timber frame, CLT and glulam. The belief is that the market will pick up further this year, however, it seems unlikely it will reach the levels of the previous years. During the Covid years, many sawmills also took the opportunity to invest in CLT, glulam or pellet production technology in order to supply growing demand for these products. This year, investment continues, but at a slower pace due to a less dynamic market. This year will also see implementation of the EU Deforestation Regulation (EUDR). French sawmills are having to ensure they comply with all its requirements and are able to supply all the necessary documentation to their customers.


So, even if some uncertainty remains, prospects for the year are reasonably good. Most producers say they are already noticing some positive signs and are optimistic. Looking forward, as our French Timber members know, it is important for the timber sector to diversify its customer base and have reliable partners in key export markets to ensure volumes when the local and European markets are not going well.


This has been the business model of most hardwood sawmills for some time. Now, larger French softwood mills are also targeting export markets as part as their long-term strategy. And, as one of our main commercial partners, the UK should be a more significant target for softwood exports.


That will be one of our goals for the years ahead – developing more partnerships in softwood between the UK and France. ■


www.ttjonline.com | July/August 2024 | TTJ


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