France: oak prices going down this spring?

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Ash demand grows weaker in Asia - prices decline

Hardwood logs auction sales have moved forward and faced new tendencies. In the end of Q1 2016, new trends seem to emerge in the oak sector. Following three years of uninterrupted growth of the oak log prices, the industry now sees the end of this epoch. At least, these are the conclusions that can be drawn from the results of the ONF (Office national des forêts – Nation Forest Office of France) auctions held in the French east (see table 1).

Meanwhile, wooden products demand remains strong among sawmill owners and forest procurers, and the unsold goods volume doesn't surpass the 10% threshold. Development of the sawn timber market in France, and Europe in general, is going in the right direction.

«There's demand for all oak goods, including parquet friezes and square-edged timber. We can see some of our clients buying with caution out of fear to face raw materials lack», noted Éric Cartaillier, the manager at Colas sawmill, Ain, France.

Unlike European markets, the Asian one is degrading. «Our Chinese clients have got more demanding when it comes to the quality of goods made both of oak and beech, while purchase volumes and prices have gone down. However, opportunists who used to benefit from the real estate bubble during the previous years, are to be gone from the market soon, so now we conduct affairs only with the real professionals», observed an industry representative specialising in exports to China (from France).  

This trends was also observed on the ash market, explains Mickaël Michaud, purchasing manager at AJ Wood. «The Asian demand has grown weaker while a lot of trees were cut due to infestation with Chalara fraxinea. As a consequence, the stocks grow, markets face oversupply, and prices decrease, by about 20% per year. However, it mainly refers to exported C quality sawn timber.»

As to beech, the prices remain very modest (see table 2). ONF notes a very slight price reduction over the last 3 months.  

Table 1:

OAK PRICES IN JURA, FRANCE

Prices expressed in EUR/m3

 

04/12/14

12/03/15

03/12/15

  11/03/16

Change over 3 month

1 m3 87 115 80 98 +22,5%
1,5m3 129 148 128 128 0%
2 m3  157 181 162 151 -6,8
2,5 m3  177 202 188 168 -10,6%
3 m3  197 - 210 181 -13,8%

Source : Robert Wood, ventes ONF du Jura

Table 2 :

BEECH PRICES, SPRING 2016, JURA, FRANCE

Prices expressed in EUR/m3

1 m3 50,8
1,5m3 54,75
2 m3  57,5
2,5 m3  59,5

According to ONF, the beech prices experience a slight decline by 2% over December 2015

Source : Robert Wood, ONF auctions, as of 11/03/2016, Crançot (Jura)

 
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