Central/West Africa: European markets quiet as holiday season approaches

Source:
ITTO
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The European summer vacation period, when importers wish to slow incoming shipment, is allowing producers to catch up on outstanding orders and to improve delivery times for the new business which is expected when European buyers return to the market at the end of August.

Country round-up

Cameroon log exporters are still facing delayed shipments as the port operator tries to clear the huge backlog of timber which accumulated when the port operations stopped while authorities negotiated the new contract with the port operator. Sawmills in the country report that sawnwood shipments are back on schedule and that they have healthy order book positions. Most mills are finding it difficult to build stock levels as business with buyers for the Chinese market is very brisk and Middle East buyers are seldom absent from the market.

Congo Brazzaville log exports continue to be very active. The demand is mainly from buyers for the Chinese market for okoume and the major „premium‟ red species. There are indications that some new investments are in the pipeline and the government appears very open to these new developments but continues to stresses that the industry must adhere to the agreed forest management plans. Any concession holder that does not stick to the harvesting plans can expect a firm response from the authorities. Transport distances have always been a major cost centre for operations in the country but news is emerging of progress in a number of projects to improve road, rail and port facilities.

Exporters in Gabon also report good business but, as in neighbouring countries, they face constraints on log availability such that it seems unlikely that production volumes could be increased above present levels. Businesses in the country report that there has been no news on the VAT repayments and this is continuing to cause cash flow problems for many companies.

Wood products from the Central African Republic must be trucked to Atlantic ports and much transits Cameroon. On June 5, following the murder of a truck driver, all road haulage between CAR and Cameroon was suspended until the security situation was assessed. Haulage between the two West African neighbours has now resumed much to the relief of the hundreds of drivers who were stranded on the Cameroon border with CAR. Truck drivers had repeatedly warned of the deteriorating security situation along the Garoua-Boulaï-Bangui road which, according to estimates, carries about CFA55 billion in goods every year.

Price gains yes, but not across the board

Overall, the recent modest increases in prices have been sustained and over the past few weeks there has been some minor price changes. However, the price movements are not across-the-board but more reflective of spot purchases when importers stocks have fallen. Most importers now carry minimal stocks so this type of „spot‟ price movement can be expected to continue. Analysts forecasts good price stability supported by steady demand through into the third quarter.

Log Export Prices

West Africa logs, FOB € per m³
Asian market
LM
B
BC/C
Acajou/ Khaya/N'Gollon
220
220
155
Ayous/Obéché/Wawa
225
225
150
Azobe & Ekki
235
230
150
Belli
280
280
-
Bibolo/Dibétou
150
145
 
Iroko 320
290
260
Okoume (60% CI, 40% CE, 20% CS) (China only) 340 340 260
Moabi 310 300 -
Movingui 220
220
180
Niove
160
155
-
Okan
280
280
-
Padouk
300
275
210
Sapele 320 320 210
Sipo/Utile
360
360
220
Tali 360 360
-

                                                                                                                                              Sawnwood Export Prices

West Africa sawnwood, FOB
€ per m³
Ayous FAS GMS 350+
Bilinga FAS GMS 520
Okoumé FAS GMS
480
Merchantable 275
Std/Btr GMS 350
Sipo FAS GMS
630
FAS fixed sizes 620
FAS scantlings 650
Padouk FAS GMS 820
FAS scantlings 870
Strips 500
Sapele FAS Spanish sizes 620
FAS scantlings 630
Iroko FAS GMS 610
Scantlings 680
Strips
440
Khaya FAS GMS
450
FAS fixed
470
Maobi FAS GMS
580
Scantlings
560
Movingui FAS GMS
420
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