Myanmar: What is causing weak demand for teak in EU?

Fonte:
ITTO's Tropical Timber Market Report
Vizualizações:
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Analysts say that, despite the easing of economic sanctions, the demand for teak in the EU, US and Japanese markets is low. Whilst the current economic downturn in the EU and US may be partly responsible for the poor demand for teak in these markets, other factors may be involved.
The number of companies in Thailand and Taiwan P.o.C manufacturing teak products for export to Europe and the US has fallen dramatically over the past few years.
Some traders suggest that teak seems to have lost the appeal it enjoyed in the 1980’s and 90’s and that efforts are required to stimulate the markets. The shrinking market for teak in Europe also seems to be linked to the decline in the quality of teak being made available.
High quality teak, the grades preferred by Japan, US and EU are not now readily available, reflecting the decline in the teak forests, say analysts. The teak forests in central Myanmar have been harvested over and over again and now yield only small quantities of high quality logs.

China and India major markets for teak
 In recent years the log grades available have been mainly SG-4 and lower. European buyers tended to purchase mainly higher grade 4th Quality teak logs but the scarcity of higher grades has meant European buyers had to accept lower grades such as SG-4.
Lower grades such as SG-7 and SG-8 are available in large quantities and these grades are acceptable in the Indian market, especially now as the Indian rupee has fallen against major currencies.
It is estimated that 80% of Myanmar’s teak log exports go to India. It is not possible to gauge the exact volume exported to China as only a small quantity is shipped out by sea to China and is thus carefully documented. Most teak for the Chinese timber industry is transported overland and documentation of this trade is a major problem.

Undecided on investment in processing capacity
While many longstanding and experienced exporters and traders are considering investing in wood processing industries in Myanmar in face of the proposed log export ban, it is reported that some still believe that the decision on the ban is reversible.

Plan needed to address forest degradation
The main issue confronting the forest authorities in Myanmar today, say analysts, is not a total or a partial log ban but how to ensure harvests are within the annual allowable cut to check forest degradation and deforestation.
In order to develop appropriate polices it is vital that the state of the forest is understood. There are conflicting reports on the forest cover which must be addressed.
According to the Myanmar forestry authority the forest cover is around 47% but according to the NGO community the forest cover is only around half of that.
Verification of the actual forest cover is will take time and will involve a considerable investment. Until such data is available there is a risk that harvest levels will be set too high.

Myanmar Teak Log Auction Prices (natural forest logs)
Average prices during the January 2013 Teak tender sales are shown below. Prices are Euro per hoppus ton.

Grade Quantity (Tons) € per ton
4th Quality 11 5039
Sawing Grade-1 21 3426
Sawing Grade-2 51 2805
Sawing Grade-4 218 2526
Sawing Grade-5 92 1823
Sawing Grade-6 118 1678
Sawing Grade-7 74 1366


Hoppus ton=1.8m³; All grades, except SG-3/5/6, are length 8' x girth 5' &up. SG-3/4/6 are girth 4' &up. SG-3 grade is higher than SG-4 but with lower girth and price.
Prices differ due to quality or girth at the time of the transaction.

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