Timber Tension: Germany’s Wood Prices Inch Upward, Yet No Signs of a U-Turn in Sight

"German Wood Prices Experience Marginal Increase in 2024, Fails to Indicate Market Recovery; Construction Industry Crisis Deepens Amidst Weak Lumber Demand"

Wood prices in Germany experienced a slight increase at the start of 2024, but experts caution that this does not signify a true trend reversal. The demand for lumber continues to remain weak, exacerbating the ongoing crisis in the construction industry. Furthermore, forest owners have voiced their criticism against the new forest law, arguing that it infringes upon their property rights and is potentially unconstitutional.

Despite the prevailing challenges, sales of softwood sawlogs have managed to maintain relative stability throughout February. The prices for fresh spruce logs within the flagship range of spruce 2b+ predominantly range between 98 and 106 euros per cubic meter. However, it is important to note that these prices can vary regionally.

The construction industry in Germany has been grappling with a significant downturn, which has had a direct impact on wood prices. The ongoing weak demand for lumber has resulted in a surplus of supply, thereby driving down prices. This trend has been further compounded by the economic uncertainties caused by the global pandemic and other external factors.

Forest owners, in particular, have been severely affected by the crisis in the construction industry. The new forest law, which has recently come under scrutiny, has only added to their concerns. According to German private forest owners, this legislation interferes with their property rights and is in clear violation of the constitution. They argue that the law fails to adequately consider the needs and interests of forest owners, further exacerbating their already precarious situation.

Meanwhile, the stability in sales of softwood sawlogs during February has provided a glimmer of hope for the wood industry. The prices for fresh spruce logs, particularly within the flagship range of spruce 2b+, have remained relatively consistent. However, it is important to note that these prices can vary depending on the region.

Despite the slight increase in wood prices, industry experts emphasize that this should not be misconstrued as a reversal of the overall downward trend. The weak demand for lumber continues to pose significant challenges for the wood industry, especially in the construction sector. Until there is a notable improvement in construction activity and demand, the industry is likely to face ongoing difficulties.

In conclusion, while wood prices in Germany experienced a slight rise at the beginning of 2024, this should not be seen as a definitive trend reversal. The weak demand for lumber and the crisis in the construction industry continue to pose significant challenges for the wood industry. Forest owners’ concerns regarding the new forest law further compound the issues faced by the industry. Although sales of softwood sawlogs have remained relatively stable in February, it is crucial to recognize that prices can vary regionally. The wood industry will need to navigate these challenges and await a notable improvement in construction activity and demand before any substantial recovery can be expected.

John O Mahony

John O Mahony

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