The Eurozone debt crisis and fiscal issues in the US are reasons why Indonesian timber exporters want to see a more aggressive timber export promotion programme.
According to the International Tropical Timber Organisation’s (ITTO) latest market report, the last issue until further notice because of ITTO funding problems, Indonesian timber exporters believe that current promotional efforts do not go far enough.
They want to see the timber industry and Indonesian government formulate strategic programmes to boost exports and therefore safeguard the industry in light of continuing global economic problems.
The ITTO also says it will not be long before the continuing weakening in housing markets in major timber importing countries and the Eurozone debt crisis will begin to effect the Indonesian domestic economy.
These and other factors are causing export prices for Indonesian timber products to plummet.
Export plywood prices in December continued their downward track, down to US$367-409 for 6mm MR BB/CC product and US$288-429 for 3mm product. Red meranti mouldings (11×68/92mmx7ft and upwards) were down to US$518-549 for Grade A products and US$476-498 for Grade B.
Malaysian exports
Meanwhile, the outlook for Malaysia’s timber sector in 2012 is uncertain for similar reasons to Indonesia – poor housebuilding volumes in export markets – according to the ITTO.
Sarawak’s exports of logs and timber products grew 1% to RM3.71bn in the first half of 2011, with the growth due to shortages and strong demand from overseas buyers, especially Japan where plywood is in demand for rebuilding.
Plywood remains the primary export product from the state, accounting for 56% (RM2.1bn) of the total export value, followed by logs and sawn timber (9%/RM300m).
According to the Sabah Timber Industries Association, Sabah’s exports of sawn timber to the UK totalled 3,046m³ in January-October, while 4,094m³ of plywood was exported to the UK.
Malaysian sawn timber export prices continued their downward trend in December, according to the ITTO. Dark red meranti was trading at US$412-448, while red meranti mouldings (11×68/92mm x 7ft and upwards) were in the US$568-601 price range for Grade A products.
Export plywood prices were US$425-455 for 3mm plywood and US$377-447 for 9mm and upwards products.
Hardwood plywood export volumes to the UK have reversed in 2011. The latest Timber Trade Federation statistics (for January-September) showed Malaysia’s share of the UK market had dipped to 14% from 20% a year ago, with Chinese products benefiting.
