Oak price causes concern

• The hardwood segment has its own peculiarities and can hardly be compared with the softwood sector.
• History does not repeat itself.

These are two pearls of wisdom that are not quite right. The number one concern for the future is supply – as is the case with the softwood sector. Both segments are also very optimistic about 2022. “We are fine as long as there is not too much log wood on the market.

“That’s what we expect for 2022. It will be a good year despite Covid-19,” was the consensus in the managing directors’ meeting. The general concern is that the spruce hype will repeat itself, only next time with oak. “The image of wood has taken quite a hit as a result of the unnecessary price development in the softwood sector. When it comes to hardwood, our goal is to make sure that forest owners are paid a fair price for the desired maintenance of the hardwood and that we can process the hardwood in Europe,” was the tenor.

Too little rather than too much log wood

The Hardwood Day can therefore be summed up as follows: The times of excessive volumes of log wood on the market are over. This is true for all types of wood because availability is decreasing and demand for lumber is increasing. An important aspect was added: Availability is on the decrease in Eastern Europe as well and the cheap log is gone everywhere in that region.

“The current situation reminds me of the year 2006. Sales are doing well and the question is: ‘Where can I get enough log wood?’”, as one concerned participant put it.

Oak continues its upward trend

In line with the strong demand for log wood, prices rose again, especially oak prices. “Everyone should ask themselves: Do I want to be a step behind the development of costs or react in good time?”, one participant commented.

Oak close to the peak

“If veneer prices are charged for lumber, it becomes too much for the end customer and us processing companies – especially since higher prices often go hand in hand with poorer assortments,” one participant warned. Another one gave the oak hype “one more year”.

Nearly all participants wondered how long the parquet industry would continue to “bet exclusively on oak”. “The price of the product is close to its peak. Higher quality beech is also scarce but it still offers certain opportunities,” one participant said, referring to a possible and desirable renaissance of beech and other types of hardwood.

Processing companies with empty warehouses

The parquet industry apparently did not manage to stock up on the necessary quantities of lumber throughout this entire year. As a result, its supply situation could deteriorate further in a normal winter – especially since the parquet industry describes demand as good. “Selling oak lumber is extremely easy. The weekly prices are almost like those of softwood in the first half-year,” one participant said with concern, who sees the main reason for the price increases in the forest, though.

Was parquet maybe too cheap in the past? At the least, it is too cheap at the moment, the participants agreed. Also: “The increases in log and lumber prices have not been passed on to the consumers yet.”

The constant rise in oak prices has continued this year as well. “The run on oak is still going on.” At the moment, however, every type of wood is selling well. “Wood is generally appreciated. That’s why I see this as a positive development because in the end, the margin is also good.”

New self-confidence in the segment

At the meeting, it was said with self-confidence that hardwood market participants “want to walk through the forest and the company with their heads held high” – that is, increases were achieved for both log wood and wages.

Refurbished Italian furniture industry

Currently, there is a scarcity of wood products on the Italian market as well. Higher prices are not yet accepted and as a result, availability is limited there, as the participants analyzed. The Italian furniture industry has repositioned itself in the difficult past years. “It’s going very well for them, and exports in particular are booming,” was the tenor.

Minimizing log exports

A very big topic in Europe is the export of log wood to China, as Maria Kiefer-Polz, Vice President and Hardwood Spokeswoman for the European Organization of the Sawmill Industry explained. “Enormous quantities are shipped from countries like Belgium, Germany or France to China. We will minimize that,” explained Kiefer-Polz. The association wants to show the European Parliament how big the export volumes are in relation to local processing.

Since restrictions cannot prevent log wood from being exported altogether, alternative solutions are needed which intervene in the phytosanitary sector, for example. “At the moment, the scarce raw material keeps leaving the domestic markets, and with it added value and jobs. That needs to change.”

Hardwood projects of the Austrian Timber Industry Association

From January 1, the EUTR regulation will change in Switzerland. “From then on, it will be extremely challenging to sell lumber, for example made from Bosnian log wood, in Switzerland. For Switzerland, documentation will be required from January 1,” Rainer Handl, sawmill industry consultant of the Timber Industry Association, said, referring to changed regulations and more work.

Upcoming projects:

• Forest fund project “Glued timber construction products made of hardwood”
• Wood dust
• CLT with middle layers made of beech
• Research terrace in Tulln
• Hardwood Academy (hardwood training)