Experts forecast a continuing upturn in wood and paper products markets (consumption, production and trade) in 2011 and 2012 for the UNECE region, with an increase in overall consumption of 0.8% in 2011 and 1.1% in 2012. Production in the same years is forecast to rise by 1.5% and 1.7% respectively. In terms of trade, exports are forecast to increase by 1.5% and 2.2%, with imports expected to fall slightly (-0.5%) in 2011 before rising by 0.7% in 2012. The forecasts were prepared during the annual Market Discussions of the joint UNECE Timber Committee and FAO European Forestry Commission on 12-13 October 2011 in Antalya, Turkey.
There are variations across the region:
- The picture in the Russian Federation is positive, with a forecast increase in consumption of close to 10% in 2011, falling to roughly half that figure in 2012. Production too is forecast to increase by only 6.7% and 4.8% respectively, so that increased consumption would need to be met, in part, from higher imports, forecast to increase by 4.5% and 3.3.%.
- The situation in North America is not so encouraging: the housing market, a key driver of demand for forest products, remains highly uncertain, with new housing starts expected to show little, if any, improvement in 2011 or 2012. While production is forecast to increase by 1% in 2011 and by a further 1.6% in 2012, overall consumption is forecast to fall in 2011 by 0.5%, before climbing again in 2012 by 0.7%. Exports are forecast to rise by 4.9% and 4.3%, helped by strengthening demand for sawn softwood from China and particle board exports.
- Forecasts for Europe suggest that growth in consumption will be disappointing, achieving only 0.8% in both 2011 and 2012, reflecting the general economic situation. Production is forecast to increase by 1% and 1.3% respectively. However, countries such as Germany and Poland, where economic conditions are better, may see stronger rises in consumption and production. Exports are expected to show only modest growth in 2011 of 0.3%, improving to 1.3% in 2012.
The most current market information on forest products market developments is available in the Timber Committee market statement at http://www.unece.org/fileadmin/DAM/timber/meetings/20111010/ApprovedTcMktStatement111014.pdf while the UNECE/FAO Forest Products Annual Market Review, 2010-2011. http://www.unece.org/fileadmin/DAM/publications/timber/FPAMR_2010-2011_HQ.pdf provides a more comprehensive picture..
Summary of Key Developments
Forest products contribute to the green economy
- The Timber Committee supports innovation in wood and paper products and their manufacture as a means to ensure optimum use of wood resources and market growth.
- Moves towards bio-refining in the pulp sector are opening up new possibilities and can provide a focus for integrated development with industries that can use its products.
- Innovation and on-going enhancements to production processes, by, for example, reducing energy and water consumption, delivering a higher proportion of end-products, are all helping to enhance the sector’s environmental credentials.
- In the longer term, on-going research into the development of cellulosic bio-based fibres and new synthetic polymers, offers exciting possibilities for the forest sector to contribute even more strongly to the green economy.
Increased demand for wood raw materials leads to higher timber harvests
- In 2010, the harvest of industrial roundwood was an estimated 950 million m3 (880 million m3 in 2009). The level of wood removals is expected to increase in Europe by only 1.5% in 2011 and by less than 1% in 2012, while in the United States, it seems likely that any increase may be negligible. Removals in the Russian Federation are expected to show higher increases.
Wood energy markets show accelerating growth
- The global wood energy market has continued to expand, encouraged by policy commitments to reduce reliance on fossil fuels and driven by market factors, such as sharp increases in the prices of oil and gas.
- The rise of the wood energy market has benefited forest owners, encouraging forest management by opening up market opportunities for lower quality wood and pre-commercial thinning. Sawmills too have benefited from buoyant markets for their co-products.
- The Russian Federation is expanding the production of wood pellets rapidly to meet increasing demand from Europe: the world’s largest wood pellet manufacturing plant began production in the Leningrad district in Spring 2011, doubling manufacturing capacity in the Russian Federation to 2 million tonnes. Plans exist to construct 13 more new plants at locations across northwest and central Russia, with a projected capacity of 3 million tones in total.
Sawn softwood markets show evidence of a slow but cautious recovery across the region
- European output in 2010 rose by over 8% to 99.3 million m3 and is forecast to reach 100.1 million m3 in 2011 and 102 million m3 in 2012.
- China’s imports of sawn softwood from Canada, in the first six months of 2011, were almost double the figure for the equivalent period in 2010 (3.14 million m3 against 1.6 million m3).
Paper and pulp markets are looking more robust as demand recovers
- Global production of paper and paperboard reached record levels in 2010 at 400 million tonnes, of which the UNECE region’s share was 183 million tonnes (46%): China accounts for about 100 million tonnes.
- Europe’s consumption of paper and paperboard is expected to stay flat in 2011 but to increase by 1% in 2012.
- North America’s paper and board consumption is forecast to continue falling by 0.8% in 2011, and remain unchanged in 2012.
Value added and engineered wood products offer huge scope to expand markets
- Production and consumption of most engineered wood products (such as glulam timber, I-beams and laminated lumber) showed modest gains in 2010 in the US, with further gains expected in 2011.
Additional information is available on the Timber Committee website at: www.unece.org/forests
Summary forecast and historical data tables by subregion are attached.
Complete tables of country market forecasts for 2011 and 2012 at: http://www.unece.org/forests/fpm/timbercommittee.html
The UNECE/FAO Forest Products Annual Market Review, 2010-2011 at: http://www.unece.org/forests/fpm/annualmarketreviews.html
For additional information, please contact:
Mr. Douglas Clark
Forest Products Marketing Specialist
UNECE/FAO Forestry and Timber Section
448 Palais des Nations
CH - 1211 Geneva 10, Switzerland
Tel: +41 (0) 22 917 2773, Fax: +41 (0) 22 917 0041