After the outbreak of the Russia-Ukraine war, timber prices rose sharply in most parts of Europe, especially in Germany, where they’ve hit record highs. Affected by the price drive, the value of German timber trade increased by nearly 25% in the first quarter; among which, lumber increased by 23%, flooring increased by 21%, and wood-based panels ranked first with a 32% increase.
For German lumber merchants, products such as spruce, oak and pine have maintained a very good upward trend for several consecutive months this year. Data show that compared to the previous year, the price of spruce rose by 44.1%; the price of oak rose by 13.5%; and the price of beech rose by 6.3%. The market demand for softwood logs is strong, and the supply volume can be removed away very quickly.
Demand for energy wood is particularly high
Due to the interruption of natural gas supply from Russia, it is well known that the demand for energy wood, mainly firewood, in Europe is strong, and the price trend of energy wood has risen due to the impact of the energy crisis. The quantity of energy wood supplied on the market is far below the market demand, and buyers are buying much more energy wood than the current demand due to stockpiling in advance for the winter this year.
High demand for energy wood is expected for a long time before the European energy crisis is eased. Investing in energy wood is now a great opportunity for European timber traders.
The price of construction wood products is slightly weaker
At present, the high temperature weather and the large-scale strikes of workers in Europe are currently slowing down the European construction industry. As a result, the sales of building wood products have also been more or less negatively affected – it is understood that the price of spruce in building specifications has fallen by 15 euros per cubic meter.
Although the current price of construction wood products is slightly weaker, industry analysts expect that with the arrival of autumn, the industry is expected to return to normal demand for construction wood and wood products, and there may be a shortage of supply at that time.
In any case, current German lumber prices are experiencing a correction due to high demand. However, trees in central Europe, dominated by Germany, are being affected by bark beetles, and the amount of pre-harvested wood has increased, but the quality of wood is likely to cause a fall in prices.
In addition, there are many uncertainties in the global lumber market, and it is still impossible to predict whether German lumber prices will eventually rise or fall.
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