30 | Sector Focus: British Timber
◄ And anyone who has to self-isolate is on full pay, rather than sick pay, so they suffer no financial loss if they are unable to work. The aforementioned demand has been well documented in TTJ over the last 18 months and the British mills have been in the thick of it. This time last year there was an expectation that the surge in demand created by stay-at-home consumers’ home and garden improvements would abate, but that simply hasn’t been the case.
“Phenomenal and prolonged”, is how Scott Gordon described it. “It’s kept going non-stop and I’ve never known a period like it in 30 years.”
He added that demand is across the range of products, with some hot spots, such as garden landscaping sleepers. There’s also been “a huge kick” in demand for C16, he said. The availability – or lack of it – of sawn timber rather than its price is the crux of the matter at the moment but having said that, British timber is still competitively priced against imported.
“The differential between British and imported timber remains higher than it has been historically,” said Mr Blyth. “British timber is priced incredibly competitively, particularly as we have seen an increase in the demand for it over the last 18 months,” agreed Mr Hackney. “As the demand for timber worldwide continues to increase, we expect to see British timber becoming the most competitive option for most merchants in the future.”
He added that the Crown distributor scheme, which was designed for independent merchants, has been a great success. “We expect to exceed our 100-distributor milestone before the end of the year and will look to extend it to BSW Timber Solutions,” said Mr Hackney. “By the end of 2022, we are confident we will reach 200 distributors. The scheme brings us closer not only to our customer, but the end user, providing us with better strategic relationships right across our customer base.
“Lockdown has presented an opportunity for home-grown British brands to demonstrate innovation, agility and, most importantly, a fighting spirit,” he continued. “Throughout the pandemic, we have kept our operations open, ensuring continuity of product availability. Demand has been strong across our entire product range, and over the last 18 months we have seen an increase in demand across a multitude of sectors from DIY right through to major infrastructure projects,” said Mr Hackney.
Log availability has been an issue for some countries – Ireland, for example – but the British mills have fared better. “It has been difficult but we have got
by,” said Mr Gordon. “All the sawmills are extremely busy and all are trying to eke out more production, so any slack in the system in terms of stock has been hoovered up. We are still able to secure all the logs we need, although not necessarily at the prices we want to see.
“But we have all got to share in what is going on here, so hopefully the growers are getting an attractive return, as we are and as our customers are.”
Graham Blyth agreed that growers should also be reaping the benefits, adding that, given improving market prices for standing and roadside timber, price inflation has resulted in an increase in material brought to market.
“In Scotland, the planting regime is strong and long term forecast and availability is good,” he said. “This is in contrast to the longer term raw material availability forecasts in England and Wales. “As a group, we are committed to a planting programme of 2,000ha by 2025 (400ha/year) and with the land already in hand to achieve this, the company hopes to achieve a total of stored carbon potential in excess of 300,000 tonnes by 2025.” The BSW Group includes Tilhill Forestry and this alliance stands it in good stead, said Mr Hackney.
“Our business is in a strong position because of the relationships we have developed through Tilhill,” he said. “We are embarking on an incredibly exciting planting programme with new opportunities and new clients. In most cases, these are being supplied by our own nurseries [Maelor Forest Nurseries, acquired in 2019], so we’ve placed ourselves in good standing regarding supply into our mills moving forward.”
As mentioned, all the sawmills are working at full stretch, mostly on the existing shift patterns and are benefiting from significant capacity improvements and high levels of investment over recent years.
Gordon Timber has slightly extended the working day, adding 10-15% in terms of hours and commensurate production. “I think we have to be mindful of the fact that it has been a period of strong trading, so everyone wants to make the absolute most of it, but at the same time you have to watch out for the burn out factor,” said Mr Gordon. “There is only so much that people can do. You’ve also got the maintenance of the machinery to consider, so there is a limit to how much we can push on. It’s a balance.” Sawn timber certainly isn’t sticking around in the yard very long and stock levels are “probably close to record lows”, said Mr Gordon, adding that lead times at this point in a typical year would be three to four weeks and are now 12-14 weeks.
“There is very strong demand for any form of wood at all,” he said. “People are even keen to take some of the lower grade products that take a little bit more shifting and cut and carve it themselves, or make do with what they can.”
He added that a lot of product was on allocation and that the company hadn’t taken on any new customers. “We really are committed to the customers that have been loyal to us over the years,” said Mr Gordon. “They all want a little bit more, so we are trying to ration that out to make sure we are fair with everyone.” Standout products were sleepers, for which there had been “insatiable demand”, all types of fencing and “4.8 of anything – ungraded, kiln-dried, C16, heat-treated…..” Mr Gordon added that the demand for heat-treated timber had highlighted the shortage of capacity in the UK.
“That was coming in around January last year before this [Covid] all kicked off and there was concern over the change in the law brought about by Brexit,” he said. “This has just magnified the issue that there is not enough heat-treated capacity in the UK.” James Jones said it had been necessary to introduce some form of allocation in order to ensure increased demands of its entire customer base were satisfied.
Above: Mills are able to obtain the logs they need PHOTO: BSW TTJ | September/October 2021 |
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“Balancing the conflicting demands of market sectors has been challenging but
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