Usually, International Softwood Conferences (ISC) take place in areas of high softwood activity, so it was a high-risk strategy to hold this year’s in Sicily, but the gamble paid off. Around 230 delegates attended and they received an information-packed day and a half.
It’s a well-oiled machine with a winning formula and I always wonder why there are so few British delegates. Some of that seems to go back to the days when British timber companies saw themselves as customers, unwilling to pay to go and hear what the supply chain was doing.
That loss of information and linkage becomes increasingly dangerous in a world where timber availability is on a downward trajectory. I’d seriously urge the larger UK softwood trading companies to attend.
The first day was packed with presentations on different countries, setting out their positions and forecasting where they will be heading through 2025. Canada, the US, Japan, China, MENA (Middle East/ North Africa), New Zealand, Australia and India were all covered, drawing out some very interesting data.
There’s no doubt that generally log prices are far too high and selling prices too low. Demand is not especially down, but there’s too much softwood on the market. However, Germany has a major structural issue, with significant declines in furniture consumption, construction and other economic activities (see pp32-33).
Previous conferences have shown forest fires and bark beetle as significant problems, but this year they appeared to be less of an issue. One major variance between European and North American sawmills is uses for by-products. In North America, apart from wood pellets, most other residues are seen as a problem, costing money to dispose of, while mills still use gas for drying. Here in Europe these crumbs from the table are often the difference between sawmill profit and loss.
China was reported to have continuing huge oversupply of new housing. Official Chinese data is difficult to pin down, but it’s estimated there are at least 90 million empty homes. Construction activity is therefore severely limited and that affects New Zealand in particular, with its radiata pine monoculture and lack of alternative use options.
The presentation on India highlighted the use-oftimber legislation change in 2020, which opens the market of 1.3 billion people to huge opportunities. But it will be a long, hard slog to get society to change its buying habits. The current usage tends to focus on price driven, lower grade softwood. This really needs to change into demand driven by specification into desirable valueadded products.
ISC debates also focused on global forest change, innovative uses of softwood and of course the new EU Deforestation Regulation (EUDR) requirements. The news of a one-year deferment of the EUDR implementation came the day before the conference and created a lot of discussion, but ultimately this is not going away.
The 73rd ISC will be Oslo. If you’re really serious about understanding the softwood market, then it wouldn’t be a bad idea to get your reservation in early. Vienna sold out last year, as did Sicily …… hurry while stocks last!
