Log and Sawnwood Prices

Industry News & Markets

International Log and Sawnwood Prices
1-15th January; 2004

International Log Prices

Sarawak Log Prices

FOB		per Cu.m
Meranti SQ up		US$155-165
	small	US$125-135
	super small	US$95-105
Keruing SQ up		US$140-145
	small	US$110-115
	super small	US$80-85
Kapur SQ up		US$140-145
Selangan Batu SQ up		US$145-145

Francophone West African Log Prices

Sapele prices have risen sharply on heavy demand. Supplies come mainly from Congo Brazzaville and the Central African Republic. Producers report that China also is buying Sapele.

Sipo prices have slipped lower and are weakening due to the heavy competition from Sapele which appears to be the preferred species right now. Demand has reportedly improved for Moabi though prices are stable and production is only moderate.

At the moment reports indicate that Ayous production is very low despite improved demand from Germany as well as Italy. Analysts expect prices to firm up in the next month.

Movingui prices have reportedly dropped sharply due to heavy stocks of logs in French ports and also in Gabon.

Buyers for the Chinese market are still pressing hard for reductions in the prices for Okoume logs. Some direct buyer contacts with log producers led to agreed lower prices but the SNBG the government sales organization refused to approve contracts prices below the official prices.

Sawmillers in the Cameroon are anxiously waiting for the Forest Minister to release new authorizations for the limited logging allowed under the Coupe Familiale system. Log supplies are currently very tight and logs for domestic milling are trading at almost same price levels as export log prices.

Markets in Europe are reported still very quiet having not moved since the Christmas and New Year holiday period. Prices, say analysts, are likely to remain dull over the winter. Asian buying is also slow and is likely to remain quiet until after the Chinese New Year.

FOB Prices	LM	B	BC/C
	Euro per Cu.m
Afromosia/Assamela	381	350	-
Acajou/N'Gollon	175	152	-
Ayous/Obeche	175	160	106
Azobe	152	145	114
Bibolo/Dibtou	145	106	-
Fromager/Ceiba	114	114	-
Iroko	274	228	160
Limba/Frake	122	107	99
Moabi	221	198	-
Padouk	206	168	-
Sapelli	259	244	206
Sipo/Utile	259	244	-
Tali	144	129	91
Doussie	427	335	-

Gabon Okoume
Grade	per Cu.m
CI	US$158
CE	US$132
CS	US$103
QS	US$176

Okoume for China
50% CI, 40% CE, 10% CS	US$200
(Free alongside)

Myanmar

The strengthening of the Euro is reflected in generally marginally lower prices in December.

Veneer Quality FOB	per Hoppus Ton
	November	December
2nd Quality	No sale	No sale
3rd Quality	Euro4204	Euro4114
4th Quality	Euro3512
Teak Logs
Sawing Quality	per Hoppus Ton
Grade 1
Average	Euro2032	Euro1985
Grade 2
Average	Euro1607	Euro1599
Grade 3
Average	Euro699	Euro684
Grade 4
Average	Euro1020	Euro1027
Assorted	Euro707	Euro675

Domestic Log Prices

Brazil

Wood product prices in the domestic market remain stable as the Brazilian Real exchange rate against the US Dollar remained stable. Prices are expected to remain stable for the months to come.

Logs at mill yard	per Cu.m
Mahogany Ist Grade	No Sales
Ipe	US$65
Jatoba	US$40
Guaruba	US$27
Mescla(white virola)	US$34

The Brazilian Institute of Geography and Statistics (IBGE) has published a report highlighting the growing importance of Brazil's forest plantations. In 2002, Brazil's primary forest production earned around R$ 6.0 billion (approximately US$2.0 billion). Of this total the following products stand out: acacia mangium bark (+401%); resins (+32%); eucalyptus leaves (+7%); fuelwood (+54%); logs for the pulp & paper industry (+6%); and logs for the mechanically processed timber industry (+10%). Only charcoal production fell (-4%). As a whole, the production of forest plantation timber rose 7.61%, from 69.8 million m3 in 2001 to 75.1 million m3 in 2002.

In other news, it is anticipated that the World Bank will enable investments of about US$1.5 billion to sustainable forestry projects in the Amazon through to 2007. The resources could be directed to promoting the sustainable development of the Amazon and to projects developed by environmental agencies provided these are within the broad framework of government initiatives. However, the World Bank has not yet made public its decision.

Indonesia

Domestic log prices	per Cu.m
Plywood logs
Face Logs	US$70-80
Core logs	US$45-60
Sawlogs (Merantis')	US$80-90
Falkata logs	US$90-95
Rubberwood	US$60-62
Pine	US$75-80
Mahoni	US$500-515

Peninsula Malaysia

Logs
Domestic (SQ ex-log yard)	per Cu.m
DR Meranti	US$180-190
Balau	US$165-175
Merbau	US$190-195
Rubberwood	US$60-62
Keruing	US$150-160

Ghana

	per Cu.m
Wawa	US$32-38
Odum	US$35-175
Ceiba	US$27-53
Chenchen	US$29-57
Mahogany
(Veneer Qual.)	US$47-160
Sapele	US$47-140
Makore
(Veneer Qual.)	US$47-140

International Sawnwood

Francophone West Africa

Surprisingly, Sapele lumber prices have not yet moved higher but, with the sudden increase in log prices, it is likely some prices rises will be seen when current contracts are completed.

Although monsoon rains have finished, logs are still in short supply in the West African region. Iroko prices are stable though supplies from Congo Brazzaville, Gabon, CAR and the Democratic Republic of Congo are said to be hardly sufficient for current demand. With the higher prices for logs, mills are struggling to break-even.

The continued difficulties in Cote d'Ivoire are causing severe problems for timber producers and processors

FOB	per Cu.m
Okoume	Euro
FAS GMS	266
Standard and Better	251
FAS Fixed Sizes	297
Sipo
FAS Standard Sizes	640
FAS Fixed Sizes	670
Sapelli
FAS	487

Dibtou
FAS Standard Sizes	381
FAS Fixed Sizes	412
Iroko
FAS GMS	548
Scantlings	487
Strips	274
Khaya
FAS GMS	398

Brazil

In the January-October period of 2003, Brazil exported US$ 2.1 billion in solid wood products, 15.9% more than in the same period of the last year (US$ 1.8 billion).

The Brazilian Association for Mechanically Processed Timber (ABIMCI) expects that these exports could reach US$ 2.5 billion this year, which represents a slight rise in comparison to 2002 (US$ 2.2 billion). Solid wood products represent 3.5% of total Brazilian exports. In 2002, Brazil exported approximately US$ 60 billion. From this total, the forest industry was responsible for 7%, and the solid wood industry, for 4%. Since Brazilian solid wood imports are scarce, these exports represent net gains for the trade

FOB Belem/Paranagua Ports

Export Sawnwood	per Cu.m
Mahogany KD FAS FOB
UK market	no trade
Jatoba Green (dressed)	US$533
Cambara KD	US$440
Asian Market(green)	丂
Guaruba	US$243
Angelim pedra	US$265
Mandioqueira	US$185
Pine (AD)	US$120

Malaysia

Sawn Timber
Export(FOB)	per Cu.m
White Meranti A & Up	US$300-305
Seraya
Scantlings (75x125 KD)	US$540-550
Sepetir Boards	US$175-185
K.Sesendok 25,50mm	US$295-305

Ghana

Export lumber, Air Dry FOB
FAS 25-100mmx150mm and up 2.4m and up

FOB	Euro per Cu.m
Afromosia	855
Asanfina	480
Ceiba	180
Dahoma	300
Edinam	360
Khaya	480
Makore	449
Odum	580
Sapele	480
Wawa	300

Peru

For US Market	per Cu.m
Mahogany 1C&B, KD 16%
Central American market	US$1150-1190
Mahogany 1C&B, KD 16%
US market	US$1170-1190
Walnut 1" Thickness,
6' - 11' length	US$620-650
Spanish cedar # 1 C&B,
KD 16%	US$600-625
Virola 1" to 1 1/2
Thickness, 6' - 8'
length, KD	US$400-430
Lagarto 2" Thickness,
6' - 8' length	US$340-355
Ishpingo 2"
Thickness 6' - 8' length	US$365-385

Domestic Sawnwood Prices

Report from Brazil

Sawnwood (Green ex-mill)
Northern Mills	per Cu.m
Mahogany	No sales
Ipe	US$274
Jatoba	US$198
Southern Mills
Eucalyptus AD	US$98
Pine (KD) First Grade	US$131

The Brazilian Association of Forest Plantation Producers (ABRAF) was launched on December 2. According to Mr. Carlos Lira de Aguiar, President of ABRAF, one of the association's first tasks will be to carry out a strategic planning study in order to contribute to the Federal Government plans for the development of plantations. ABRAF is keen to support the Federal Government with the National Program of Forests (PNF), which foresees the planting of 600,000 ha per year.

The objective of the PNF is to reduce Brazil's wood deficit, getting the small farmer stared in the business and expanding Brazil's competitiveness in the global forestry production business.

In other news, after 11 years of debate, the Brazilian Chamber of Deputies approved, this December, a project that will regulates the use and preservation of the Atlantic Forest. The project foresees that 7.2% of the original area of the Atlantic Forest shall be preserved. Environmentalists and deputies who defend sustainable forest harvesting are pleased with the text of the decision which will substitute the original text presented in 1992.

The project delimits the Atlantic Forest area, defines its domain, creates mechanisms for protecting natural regeneration and establishes parameters for its economic exploration. Although it is less strict than the original project, it enables the sustainable use of the forest and establishes mechanisms to compensate farmers who might happen to suffer financial losses due to the new restrictions.

The new text also deals with the protection of bio-diversity of the Atlantic Forest, such the protection of the restinga vegetation (low and thin woodland on sandy soils) along the coast, canopy forests, swamps, and gallery forests. The deforested areas that now represent secondary forests shall be allocated for reforestation.

Report from Indonesia

Sawn timber, ex-mill
Domestic construction material

Kampar		per cu.m
AD	3x12-15x400cm	US$200-210
KD		US$280-290
AD	3x20x400cm	US$305-315
KD		US$320-330
Keruing
AD	3x12-15cmx400	US$225-230
AD	2x20cmx400	US$220-225
AD	3x30cmx400	US$230-235

Malaysia

Sawnwood	per Cu.m
Balau(25&50mm,100mm+)	US$215-225
Kempas50mm by	US$165-175
(75,100&125mm)
Rubberwood
25x75x660mm up	US$195-205
50-75mm Sq.	US$210-220
100mm sq.	US$235-245

Ghana

Sawnwood	per Cu.m
50x100mm x 4.8m
Wawa	US$72
Emeri	US$120
Dahoma	US$144
Redwood	US$144
Ofram	US$96
50x75mm x 4.8m
Dahoma	US$160
Redwood	US$128
Ofram	US$96
Emeri	US$115

Peru

	per Cu.m
Mahogany	US$1485-1490
Virola	US$180-195
Spanish Cedar	US$630
Catahua	US$172-177
Tornillo	US$347-358

Source:ITTO