The consequences of Hurricane Katrina are starting to impact on the UK.
Ken Edwards of Tunbridge Wells-based Kensway Panel Trading Ltd was sent this photograph of Gulfport, Mississippi – one of the main import ports in the US for Brazilian timber – by an American colleague.
Mr Edwards said: “As you can see, a huge amount of inventory has been lost.
“Brazilian softwood plywood prices have risen by at least US$25 a cubic metre and we expect to see US demand keeping those prices up. Volumes that would have been available to Europe will disappear.”
The hurricane has also caused fuel prices to rise, driving up transport and delivery costs for UK timber traders.
Damage to US oil refineries in the Gulf of Mexico coupled with an existing shortage in world refining capacity have sent the price of diesel up to £1 a litre.
Scotline Ltd said marine gas oil prices had increased by 100% in the last 18 months and were now at a record £325 per 1,000 litres, compared to £180 at the start of 2005.
Managing director Peter Millatt said: “For shipping in general there will be a steady increase in freight and haulage rates. We increased our rates at the beginning of July and are constantly reviewing the situation.”
Howarth Timber Group said the fuel price hike had increased the company’s distribution costs which would have to be passed onto customers in the long run.
Group chairman Andrew Howarth said: “We are looking to increase volumes of drops, making sure our delivery spread is as tight as possible.”
A Buildbase spokesperson said the only way it could try to offset the effect of high fuel prices was to maximise delivery loads and ensure drivers did not fill up tanks at expensive motorway service stations.
Timber Trade Federation product manager Nick Boulton said fuel surcharges could be levied on timber shipments in the coming months but much depended on the wording of transport contracts.
