“It is still unclear how the EU recovery package will be realised, how the economy will be boosted, and how all of this will affect construction,” says Antti Koskinen, Senior Consultant at AFRY.
In Europe, approximately 70 per cent of sawn timber is used for construction. Packaging makes up a little more than ten per cent. The rest of the sawn timber is used for the woodworking industry and furniture.
“The construction industry is sensitive to economic fluctuations, and a lot of internal changes are taking place. During the coronavirus pandemic, repairs and other DIY projects in households became surprisingly popular.”
The assumption for the coming years is that construction will grow at a rate of a few per cent a year, and this will be reflected in the demand for sawn timber.
The spike in demand and prices in North America also increased sawn timber prices dramatically in Europe: markets operate globally, and European sawmills started to focus on exports to North America. According to Koskinen, prices usually come down quite quickly after initial spikes.
“Let us hope the prices come down in a controlled fashion, because sawmills often struggle when reacting to rapid price drops.”
Insect damage due to global warming has occurred in Central Europe and even as far north as southern Sweden. Attempts are being made to limit the damage by felling, and a lot of cheap poor-quality wood is coming to the market as a result.
Sustainability and climate issues are increasingly important subjects in Europe. At least in terms of attitudes, this is making wood construction more popular. Yet the change is still not visible in regulations.
This article was originally published in Timber Magazine issue 2021–2022.