Wood prices in Germany rose steeply up until May. Now there are first signs of a correction, especially for softwood lumber, less for pulpwood and energy wood. The economic crisis is apparently also catching up with the German wood market.
Up until May, wood prices in Germany broke record after record. This applies above all to spruce wood, but recently also to oak. The prices for beech and wood are also not far from their previous all-time highs. And the prices for pine wood have also been rising steeply for months. And there is still good news for German forest owners: According to the last survey by the German Federal Statistical Office (Destatis) in May, producer prices for all types of wood continued to rise steeply.
In any case, so far – despite all the prophecies of doom – there is no sign of a slowdown in the upward price movement. Spruce wood has increased in price by a further 2.5% compared to the previous month and compared to the previous year, wood producers are getting 44.1% higher prices for spruce. For pine, the statisticians report an increase of 1.3% compared to the previous month and 24.6% compared to the previous year – but unlike spruce, the prices are still a long way from their previous peak values of summer 2014.
According to the calculations of Destatis, pulpwood and energy wood increased in price even more than spruce in May – suppliers received 2.7% more for pulpwood in May than in April and compared to the previous year it went up by 37.4% . And when it comes to energy wood, prices are going through the roof. The month-on-month premium was 3.9% in May and there was 60.5% more money for suppliers compared to a year ago.
German hardwood producers could also benefit. Oak wood is about 13.5% more expensive than last year and in May 2022 it will cost the same as before. Beech wood prices have also risen by 6.3% year-on-year and are now not too far off their previous highs.
Statistics (up to May) also show similar price increases as at the producer level for the industrial sector (sales prices in industry): There, the prices for softwood lumber in May were 41.9% above the previous year and compared to April were even a whopping 3.7% gone up.
Energy wood particularly in demand this summer
In June and July, the situation on the German wood market apparently calmed down somewhat. Traders and forest owner organizations report longer company holidays for the sawmills over the summer months. However, the smaller supply from the German sawmill industry means that supply is falling. The demand for softwood pulp logs was therefore brisk, market observers report. Quantities made available are quickly transported away and taken over. Prices have continued to rise.
Beech wood is also in high demand, and prices have also increased here. And the energy crisis also has a significant impact on the price development of all types of energy wood. As the data from Destatis showed in May, prices in this area have risen particularly sharply.
For firewood , which requires storage for up to 2 years to dry, the explosion in demand is well outstripping supply in most regions. The fact that some buyers stock up on firewood in excess of their actual needs further exacerbates the shortage. In addition, the switch from gas and oil heating to wood heating will result in an additional surge in demand, which is likely to continue for some time.
Problems in the construction industry – lumber prices somewhat weaker
Galloping inflation and the cost explosion as well as a shortage of workers in the German construction industry could sooner or later have a negative impact on the sale of building products made of wood and sawn timber.
In some regions, the price for the leading range of spruce, A/B, 2b has been reduced by up to 15 euros per cubic meter, market observers report. However, it is far from clear whether there will be a further fall in prices. Because the available supply is likely to continue to be scarce with the increase in demand in the autumn.
Nevertheless, the energy wood market seems to be the most attractive at the moment and probably also in the longer term. It therefore makes sense for German forest owners to invest free capacity in energy wood production. The upcoming roundwood price level for fresh and beetle wood is currently not foreseeable, but will drop somewhat compared to the current level, market observers believe.
The reasons for this are the increasingly poor economic forecast and the risk of a recession. The construction sector in particular could be affected. Declining new construction applications show the uncertainty of customers and the consequences of rising interest rates and galloping inflation. German forest owners fear that the new agreements for log prices often have to be made at very short notice or at the current price level.
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