‘Disappointing’ is the outlook on latest Softwood Forecasts, which is all about prices and the always intrusive Brexit effect factor.
This’ ‘flatlining ‘situation is especially worrying to the Timber sector as a whole as softwood imports often act as a benchmark for many other timber products.
These key forecasts come from the TTF’s National Softwood Division (NSD). Theses are the latest Softwood Forecasts for 2018 and they are certainly showing disappointingly low growth at 0.5% for 2018.
It is worth noting that this follows a general upward trend of the past five years, including a growth rate of 3.7% from 2016 to 2017.
Say the TTF experts “This situation is largely due to price issues resulting from the depreciation of Sterling coupled with general economic uncertainty over Brexit and single market membership.
The latter issue is extremely relevant to the softwood market since around 60% of timber used in the UK originates from EU countries.
Since the supply of UK timber is insufficient to adequately meet any shortfall of EU derived material, there is an urgent need to clarify the UK’s position within the customs union. The administrative and economic burden on timber importers of a withdrawal from the customs union could potentially be extremely disruptive to the industry, with longer port clearance times and higher costs.
We urge the government and the chancellor to invest more into UK housebuilding to help re-stimulate the economy and the national demand for timber. With wood products turnover forming a huge proportion of the overall construction products economy, higher even than plastics and furniture, this industry must be fostered and promoted.”
The TTF observes that of course the UK softwood market is closely tied to the construction sector and acts as a good indicator of the general health of this industry.
Softwood timber is used in almost all aspects of housebuilding in the UK, from timber frame housing to joists, trussed rafters and tile battens used on conventional brick and block builds.
A decrease in demand from this industry would have a severe impact on imports and vice versa any disruption to softwood imports could likewise disrupt the housebuilding sector.
There is also – says the TTF – the added element of general economic uncertainty surrounding Brexit and the knock on effect this is having on UK GDP. So far in 2017, growth has been limited to 0.3-0.4% lagging behind many other top EU economies in the same period with the future forecasts also looking pessimistic.
In the past the NSD forecast has been accurate to within a 1% margin of error, giving confidence to the validity of the 2018 prediction. This flatlining is especially worrying to the timber sector as a whole, as softwood imports often act as a benchmark for other timbers products.