Prices for timber will be increasing over the coming months. There’s a lot of uncertainty in the markets at the moment (a lot is resting on whether or not the sanctions against Russia will be lifted, but that in turn will fall down to individual countries and their own moral standing as to whether they wish to recommence trade with Russia or not). Initial indications are rumoured to be increases of between 9% and 11% but we don’t, as yet, have any concrete figures.
Unfortunately, timber prices in the UK will increase over the forthcoming months. There are simply no means to avoid these increases given the current volatile market conditions and scarcity of materials. Please see some of the below mitigating factors that may highlight this in greater detail:
- Supply of logs has diminished due to combination of factors – Reduction in overall harvest combined with lower sawmilling production over last three years.
- No supply from Russian Federation post invasion of Ukraine/ Private owners not harvesting as forest more for social or environmental reasons.
- Bark Beetle disaster in Central Europe (most regions of EU have beetle damage stocks)/up-and-coming EUDR restrictions (particularly in North Sweden) and LULUCF regulations.
- Log prices have been, and are, continuing to rise far faster than price of any finished product (low demand in UK for DIY, construction, Fencing & Garden markets).
- Most areas have seen log prices increases of nearly 100% since COVID five years ago and more recently, between 40 – 50% increase over last two years and with the shortage of suitable raw material will increase further in Q3 2025 and beyond.
- Current price increases/development reflects shortage of raw material (it is not a case of ‘crying of wolf’ as over last decade) – but it is not a as a result of increase in real consumption/ demand BUT this shortage will continue due factors as above.
- It is not a short-term problem but one of medium- to long-term about lack of substitution in supply.
The majority of our timber stocks are purchased directly from UK, Scandinavian and Estonian mills. The government-owned Scandinavian mills are foresting less and less due to imposed restrictions and therefore the private mills are “cashing in” on the reduced volume of timber availability. The Estonian mills are choosing to ship increased volumes of unprocessed logs directly to Northern America, North Africa and now Poland, and the UK mills (typically purchasing a great quantity of Norwegian logs) are struggling to secure the necessary volumes leading to low availability and increased premiums across all sectors.
With a global downturn in construction the mills are choosing to produce less and less material and are therefore commanding a premium for the processed sections or they are simply choosing not to process/cut any material and are simply shipping unprocessed logs to the highest bidder (currently the USA).
We will, of course, limit any increases wherever possible but they will be communicated at the point your purchase orders are received
