Overall actual softwood timber market reflection (inspired by PMI outcome January)

2024 is on the move! We can’t go back anymore 😉
Despite the fact that the current mood in the market is around freezing point, I still see some light in this too long tunnel. You just have to want to see it…

The summary of the global composite PMI says it all; It rose by 0.8 points to the highest point in seven months (51.8). Production growth was initiated by an improved inflow of new orders and stronger job creations. Business optimism also increased, indicating that the expansion is still on solid foundations and widely supported with better performances in both the manufacturing and services sectors and signs of stabilizing price pressure.
ECB President Christine Lagarde is also cautiously optimistic. During the press conference on January 25, she said: “If we try to look at PMI figures in particular (…), we see some encouraging numbers.”
We see a clearly rising trend in many regions worldwide, including in Europe where the growth figures are the most lacking (with France as the black sheep in this), although it may still take several months for this to be converted into growth.

Looking at the timber market, we see a partly contrasting picture compared to other industries. The timber price has a rising trend that has continued into the beginning of this year. In addition, availability is still under pressure. Due to generally low stocks, demand seems good although it is still far from convincing.
This situation is not expected to recover in the short term, and the pressure on cost components (including roundwood) will remain high.
Construction and garden timber are now lagging in demand and will probably continue to do so throughout this year. While packaging timber is on a modest upward trend.
As long as the supply remains so low and the demand improves step by step, as expected in wooden packaging, there is a good chance that this rising trend will continue in this way with corresponding prices as a result. No major change in demand in the short term but the first signs of this to be expected during the second quarter.
The optimism for the next 9 months is very positive overall in industries worldwide (e.g. The AEX Index on the Amsterdam stock exchange closed at its highest level ever), Why wouldn’t we be?

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