Founded in 2004 and operating in Europe, Lithuania-based timber export and import company DIVERUS has been one of the leading round timber trading companies on the German market since 2019, in areas heavily affected by the bark beetle in North Rhine-Westphalia, Lower Saxony, Saxony-Anhalt, Hesse and Thuringia. The Lithuanian company has exported the largest volumes of logs from these regions to Asia, mainly to China.
However, both the global and European timber industry, which is now facing an imbalance, were first affected by the pandemic and then by Russia's war against Ukraine. Although the German market seems to be shrinking this year, the main players in Germany are still sticking to relatively high prices for logs. In China, on the other hand, prices have fallen significantly over the past six months.
“The latest data indicate a sharp decline in wood demand in the Chinese construction sector in the last 10 weeks (April-May 2023),” said Donatas Jucius, DIVERUS founder. “The Chinese themselves have not experienced such volatility in the construction sector since 2015.”
Meanwhile, Germany is experiencing a shortage of roundwood in the second quarter of 2023 as most of the spruce forests in the hardest-hit areas have been cleared in recent years. According to the Federal Statistical Office (Destatis), a total of 78.7 million m3 of wood were felled in German forests in 2022. Trees damaged by insects, wind, snow and other causes accounted for 44.7 million m3.
An infestation by the bark beetle has already been observed in other countries such as Italy and Austria. According to Tomas Jucius, log partner at DIVERUS, western European countries affected by the bark beetle will make great efforts to remove the damaged wood from the forest as much as possible, therefore a decrease in log prices is to be expected as the market is likely to have a surplus of logs will be recorded.
“Germany faces widespread economic uncertainty,” said Mr Klinkert. “The collapse of the construction industry and the end of the recently recorded boom in the timber sector are currently unsettling the forestry and timber industries. At least in the summer holiday season this will continue or even increase. Then it will be interesting to look at the development in autumn.”
With branches in Poland, Estonia, the Ukraine and now also in Germany, DIVERUS generates an annual turnover of 0.5 million m² of wood production and a turnover of €79.2m in 2022 (2021: €86.2m; 2020: €63. 7m).
DIVERUS in Germany is looking for long-term partnerships. This is reflected in the establishment of a German subsidiary and the development of a strong vision for the future. DIVERUS GmbH is now looking for purchasing managers in various German regions, buyers for "standing forest" and a rail logistics manager.
“Given our experience in the German market, we are determined to strengthen the interests of forest owners by building our own fleet of logging trucks and starting to buy steep forests from private forest owners, organise tree felling and be able to be able to deliver the wood to our customers with our own transports in the future," said Mr Jucius.
