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Report from
Europe
EU tropical veneer imports on the rise
After making gains last year, EU imports of tropical
veneer have continued to rise in 2017, hitting 40,000
metric tonnes (MT) in the first quarter, a 15% increase
compared to the same period in 2016. As in 2016, most
gains were in imports from Gabon, which increased 28%
to 21,700 MT in the first quarter of 2017.
EU veneer imports also increased from several smaller
supplying countries including Congo (+18% to 2,900 MT),
DRC (+187% to 1,400 MT) and Equatorial Guinea (+45%
to 1,400 MT). However, imports declined from Côte
d'Ivoire (-19% to 6,600 MT), Cameroon (-1% to 3,000
MT), and Ghana (-12% to 1,500 MT). (Chart 1).
EU imports of veneer from Gabon consist mainly of rotary
okoum¨¦ veneer destined for plywood manufacturers in
France. The EU market for decorative tropical hardwood
veneers is benefitting to some extent from the slow
recovery in EU furniture and joinery manufacturing
activity.
However, the fashion for oak in the EU is as strong as
ever, and competition from wood look-alike products such
as laminates and luxury vinyl tiles has continued to
intensify, as the look and performance of artificial surfaces
has progressively improved.
Surge in EU tropical plywood imports in 2017
Following a 15% rise during 2016, EU imports of tropical
plywood increased a further 45% to 89,900 MT in the first
quarter of 2017. Much of the increase comprised plywood
faced with tropical hardwood veneers manufactured in
China and destined for the UK and Belgium. Imports of
this product from China increased 66% to 28,600 MT in
the opening 3 months of this year.
However, there were also gains in direct EU imports from
all the major tropical suppliers during the same period.
Imports increased from Indonesia by 54% to 23,400 MT,
Malaysia by 8% to 18,500 MT, Brazil by 84% to 2,900
MT, Thailand by 123% to 2,000 MT, and Morocco by
106% to 1,900 MT. Imports from Gabon were stable at
5,200 MT during the period. (Chart 2).
The changing composition of EU plywood imports may be
partly related to enforcement of EUTR and CE marking
requirements. This is encouraging a shift from Chinese
mixed light hardwood products to plywood containing
more clearly identified species of known tropical origin
and technical performance.
It also provides new opportunities for plywood imported
directly from tropical countries, particularly Indonesia
following issue of the first FLEGT licenses in November
2016.
EU imports of tropical wood flooring continue to
decline
After declining 18% in 2016, EU imports of wood flooring
from the tropics fell a further 7% in the first quarter of
2017 to 9,900 MT.
While imports from Brazil increased 35% to 3,300 MT in
the three- month period, imports declined from all other
significant tropical supply countries including Malaysia (-
9% to 2,300 MT), Indonesia (-32% to 2,000 MT), Viet
Nam (-23% to 700 MT) and Peru (-2% to 600 MT). (Chart
3).
The continuing decline in EU wood flooring imports from
the tropics this year forms part of a wider trend of
increased dependence on European manufacturers in the
EU.
EU imports of wood flooring from China ¨C the largest
supplier outside the European region ¨C are also declining.
After falling 12% to 341,000 MT in 2016, EU wood
flooring imports from China declined a further 12% to
82,000 MT in the opening quarter of 2017.
Meanwhile, EU imports wood flooring imports from
neighbouring European countries, such as Ukraine and
Bosnia, are rising. There are also clear signs of
intensifying competition and over-capacity in the EU¡¯s
domestic wood flooring sector. Statistics published by the
European Parquet Flooring Association FEP show that
consumption of real-wood flooring in Europe is rising
more slowly than domestic production.
Trade data also reveals a significant rise in internal EU
trade ¨C as western European distributors are buying more
wood flooring from manufacturers in Eastern Europe. At
the same time EU exports of wood flooring have been
rising, although the pace of growth is slowing with
declining opportunities for market expansion in Russia and
the Middle East.
Taken together these trends indicate a very challenging
market environment for external suppliers of wood
flooring into the EU.
Dip in EU imports of wood doors from the tropics
After a 24% increase in 2015, EU imports of wood doors
from tropical countries dipped 2% to €167 million in
2016.
This slow downward trend continued into the first quarter
of 2017 with imports of €40.5 million being 1% less than
the same period the previous year.
Much of this trade comprises imports of doors from
Indonesia into the UK. Jeldwen, a leading operator in the
global market for joinery products, has significant door
manufacturing capacity in Indonesia and is also a leading
distributor to wholesalers and DIY chains in the UK.
In the first quarter of 2017, EU imports of wood doors
from Indonesia increased 8% to €27.6 million. In contrast
imports from Malaysia, the only other significant tropical
supplier to the EU market, fell 18% to €8.9 million. (Chart
4).
Wood doors purchased in the EU are now rarely made
from solid timber and instead are manufactured using
veneered panels and finger-jointed timbers. Requirements
to comply with higher energy efficiency standards and
efforts to provide customers with long-life time guarantees
are driving this concerted shift to engineered wood
products.
Flat-lining EU imports of wood furniture from the
tropics
The EU imported wood furniture with total value of
€459.1 million from tropical countries in the first three
months of 2017, 1% more than the same period in 2016.
This follows a 1.3% fall in EU imports to €1.64 billion in
2016.
EU imports of wood furniture from Vietnam, by far the
largest tropical supplier, were static at €232.3 million in
the first quarter of 2017. Imports increased slightly from
Indonesia (+1% to €87.3 million) and Malaysia (+4% to
€50.0 million) during the same period.
There was a much larger 14% increase in imports from
India to €48.9 million. Imports declined 12% from
Thailand to €14.9 million (Chart 5).
The lack of any significant upturn in EU imports of wood
furniture from Indonesia in the first quarter of 2017,
immediately following issue of the first FLEGT licenses,
will disappoint Indonesian manufacturers, particularly
when considered against the rise in imports from India
which is not engaged in the VPA process and has no ready
access to certified wood material.
This suggests that there is still much work to be done both
to increase awareness of FLEGT licensing and ensure
more rigorous implementation of EU Timber Regulation
in the EU furniture sector.
More positively for the FLEGT programme, the
competitiveness of Indonesia in supply of wood furniture
to the EU seems to have improved in relation to China.
The value of EU imports from China fell 2.3% to €766.1
million in the first quarter of 2017. This follows a 3.7%
fall in EU imports from China to €3.04 billion in 2016.
Closer analysis of the trade data reveals a lot of flux in EU
imports of wood furniture from tropical countries at
national level during 2017. Imports of wood furniture from
Viet Nam have fallen sharply into the UK and Germany
this year, whereas Sweden, France, Denmark and the
Netherlands have all imported more from Viet Nam.
Imports from Indonesia have risen into the Netherlands
and Spain this year, but fallen into the UK and France. The
rise in EU furniture imports from India this year is mainly
concentrated in the Netherlands and Germany (Chart 5).
EU demand for wood furniture from tropical countries
also needs to be considered in the light of wider
consumption and production trends. As in other sectors,
there are clear signs that while demand for wood furniture
in the EU is rising, competition is also intensifying. EU
manufacturers, particularly in Eastern Europe, are
producing more at a time when domestic consumption is
growing only slowly and exports to other parts of the
world are weakening.
Wood furniture suppliers in the tropics face significant
competition from domestic manufacturers and
manufacturers in Eastern European countries outside the
EU, as well as in China.
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