There are early signs of wood availability returning to established seasonal patterns, according to the Timber Packaging & Pallet Confederation (TIMCON) – although significant challenges in the market remain.
The independent AFRY index reported the price of home-grown pallet timber decreased by a further 0.1% in February 2022. Historically, prices traditionally come down during Q1, before rising again as demand for fencing timber grows towards the summer – due to the series of powerful storms in February this market has already started to see demand increasing.
However, supply chain difficulties continue to impact on the sector, including strong demand for timber from competing markets; higher raw material costs; widespread shortages of staff; rising energy costs; fuel costs – not helped by the cessation of the use of red diesel throughout the sector; availability of nails; and ongoing severe availability and price issues in the shipping industry.
The developing conflict in Ukraine has created further instability, as detailed in a recent release from the European Federation of Wooden Pallet & Packaging Manufacturers (FEFPEB).
TIMCON President John Dye said: “After the past two turbulent years, the signs of more seasonal trade flows and predictability in the market are welcome. However, we are aware that the trading climate remains difficult, with ongoing pressures affecting the supply of timber.
“The tragic events in Ukraine have added a further challenge, with closed sawmills and generally disrupted trading with this source country impacting on usual wood supplies into Europe. Meanwhile, economic sanctions will have a significant effect on Russia and Belarus.
“TIMCON is monitoring this complicated and evolving situation and will continue to keep its members informed about the latest developments affecting timber pallet and packaging businesses.”
Global challenges and developments are among the topics that will be discussed in the forthcoming TIMCON general meeting, which is scheduled to take place in Manchester at the end of March.
Organisations confirmed to present latest timber sector developments at the event include COILLTE and CONFOR. The agenda will also cover the industry’s role as a leader in sustainable practices, as supply chains increase their emphasis on recovery and reuse of pallets.
“During the pandemic, TIMCON has demonstrated to its membership how vital it is for our sector’s businesses to be part of a strong industry association, which keeps them informed and equipped, and represents them on the national, and international, stage,” said Dye. “The excellent programme we have lined up for our general meeting is yet another part of our ongoing essential service to the sector. We are really looking forward to hosting it and discussing with members how we can support them further in the months and years to come.”
TIMCON retained close to 100% of its membership during the pandemic and it expects further members to join, particularly from the packaging segment of the industry.