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

Regarding the approach to the availability in our timber industry, I was correct in my conclusion last month.
However, concerning the PMI production forecast, it could be a bit more optimistic in my opinion….

It seems that the production PMI has reached its lowest point, but it is still clearly lingering in the contraction zone. Developments in the global industry and trade often go hand in hand. This is especially true for the wooden packaging industry, which reacts directly (from which I still harbor hope for a recovery in the second part of the first half of 2024…). Short term expectations for (global) recovery are there, but they will be modest.
With a global production PMI of 49.3 showing improvement (partly due to India, China, Indonesia),
the average prices for goods and services rose worldwide in November at a slightly higher pace, although the inflation rate is still among the weakest of the past three years.
Despite improved sub-indices, also in the Eurozone, they lack the dynamics necessary to establish an upward trend…

The timber market is moving… not because of improved demand but because of the supply side, whether temporary or not, is limited. This contrasts with the improvement of the supply side in the global industry.
Under the pressure of ever-rising costs and the fact that ‘it is just not sufficiently available right now’, the supplying industry is finally (forcedly) managing to subordinate supply to demand.
However, it is the demand side that determines this, not the costs.
But when production constraints continue to show, we will have to get used to higher prices in our timber industry again.

Despite the operational facts and the short-term forecast not being favorable, we are entering 2024 with good spirits!
I wish everyone very happy end-year holidays!”

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