UK wood packaging specifiers are being warned to expect continued pressure on pallet and case pricing throughout 2021 and plan accordingly, following a year that saw unprecedented international shifts in the supply and demand dynamics surrounding timber.
In 2020, we saw a range of factors – from forestry infestation and production interruptions at sawmills in Europe and North America to yo-yo demand from high consumption markets like China and the US – conspire to make sourcing timber here in the UK harder and more costly than ever.
New Year starts where 2020 left off
These pressures are set to continue as the UK gets to grips with new EU trading arrangements, the wider world continues to tackle the Covid 19 crisis and unpredictable demand remains the order of the day in an uncertain economy.
Indeed, just last month, the Timber Trade Federation (TTF) warned a lack of on the ground timber stock was set to be an issue well into Q2 of 2021 and beyond due to pandemic-related issues and changes in market dynamics, exacerbated by high levels of global demand for timber and wood products.
In a typical year, there would normally be increased timber availability in the first quarter as demand from the construction industry tails off, but we continue to be in anything but a standard year, with mills continuing to quote long lead times on new orders as a result of constrained log supply from the UK’s key sources in Ireland and the Baltic.
It’s a similar story across the US and Canada, where prices hit record levels last year and supply is likely to remain
ed constrained during the first quarter of the year at the very least, due to an unprecedented off-season rally in timber futures, which touched a record high at $845 per thousand board feet in December, surpassing the previous peak reached in August last year.
Our service commitment to you
Throughout the pandemic we have continued to work hard to ensure continuity of product supply and mitigate the impact of these pressures on customer pricing, and we will continue to do so over the year ahead.
In line with the TTF’s recommendations however, we would urge customers to consider their buying requirements for the months ahead and work with us as early as possible to ensure their needs can be met with minimum interruption.
Thanks to our enduring strategic partnerships with timber suppliers here and overseas, we are confident of being able to ensure continuity of supply for customers throughout 2021. Rest assured, we will continue to update customers on this dynamic situation as developments occur…