The demand for the Egyptian market is back
In the last quarter, the price decline that began in the first quarter continued reports Swedish sawmill company Bergs Timber in its interim report. Forest Industries Federation's export price index has from the beginning of the fiscal year to the end of the third quarter in May, declined in terms of the price of pine products by 14 percent and fir products by 9 percent. Markets in North Africa and the Middle East has a great importance for the Swedish sawmill industry. In 2010 these markets accounted for 22 percent of the total timber exports and the 42 percent of pine exports. Demand from Egypt who is the most important timber market in North Africa has largely returned. Demand in Japan will increase over the next year when the reconstruction after the earthquake and tsunami will start.
The reason for lower prices is the current mismatch between supply and demand and that monetary developments have given a negative impact on prices. Recent reports in May indicates a stabilization and a slight increase in May compared with April. Output growth in Sweden and its European competitor countries have since the summer has exceeded consumption growth.
From January to May this year, production under forest industry statistics, increased by 4 percent in Sweden and 10 percent in Finland. Stocks of producers' ranks in Sweden is 10 percent higher and in Finland 15 per cent higher than the corresponding period last year. Historically, however, the level of stocks at a balanced level and expectations of reduced inventory levels are when we have a good utleveransperiod ahead in June and July.