value-added wood products trade...from eastern europe to western europe, mostly to germany p-m...

UN/ECE TIMBER COMMITTEEUN/ECE TIMBER COMMITTEEGeneva, Oct. 2003Geneva, Oct. 2003

VALUE-ADDED WOOD PRODUCTS

TRADEP-M. DESCLOSForest Products Consultants

pmdfilo @ tin.it

P-M DESCLOS pmdfilo @ tin.itForest Products Consultants 2UN/EC TC V-AWPT 2003

Introduction

This short presentation will cover the international trade of furniture, joinery, carpentry, profiled wood and flooring with a special chapter on laminate flooring and engineered wood products in reference to the North-American and Japanese markets

Even if their share of the total international timber trade grew, the overall trade of value-added wood products started slowing in 2001 after several years of steady growth.


Drivers and Strategy The international trade of value-added wood products is the result of an ever and fast changing combination of many factors, the main ones being:

international labour division,reliability and access to the forest resource,

investment (national or foreign direct investment)exchange rates and freight costs

The changing markets of emerging countries have brought a change in the scope of foreign investment in added-value manufacturing.

Earlier approach: to establish new lines of supplyRecent strategic re-orientation : to cover also the local demand

of emerging markets e.g. eastern European countries


Drivers and Strategy International out-sourcing means flexibilityand quick adjustment to any change of equilibrium.

The international trade of added-value products reacts much faster than primary products trade to the variations of exchange rates.

0.8

0.9

1

1.1

1.2

11

2002 3 5 7 9 11

2003 3 5 7 9

1 US$ = €

0.007

0.0075

0.008

0.0085

0.009

0.0095

11

2002 3 5 7 9 11

2003 3 5 7 9 11

1 YEN = €


Furniture: International trade flowsInternational furniture trade:

More than half of the global international furniture exchange istraded between exporters and importers of the same region *:

Western Europe: 66%NAFTA area: 60%Asia / Pacific regions: 50% *Source: EPF / CISL

Main transcontinental / transregional furniture trade flows :

from Asia to the USA and Europefrom Europe to the USA, mostly from Italy from Eastern Europe to Western Europe, mostly to Germany


Furniture: International tradeIn 2001 the global import of furniture went down by 2.8%.In the EU-15, the furniture production was down by 14%. The balance of furniture trade went negative and a correction of this trend is unlikely.The rapid growth of the Asian furniture industries has a direct impact in the USA and in Europe, mainly in the lower-cost range. China is now the second world exporter of furniture. Its capacity is expanding and the current trend will last, both in parts and finished furniture.The foreign trade is very positive for Eastern and CentralEuropean countries.e.g. in the last 5 years, the German imports of furniture from

Eastern countries more then doubled, and currently Germany imports more furniture from Poland than from Italy.


Furniture

0

5

10

15

20

25

30

35

1997 1998 1999 2000 2001

Billion $

Furniture parts, all materials Furniture, other materials Other furniture Bedroom furnitureKitchen furniture Office furnitureSeats

World imports of wooden furniture by product group

Source: UN COMTRADE, 2003


Furniture

Major importers of wooden furniture and parts, 2001

Japan6% UK

7%France

8%

Germany10%

USA33%

Others36%



Joinery, carpentry and profiled wood

In value, the global imports of joinery, carpentry and profiled wood, went down 2.4% in 2001.

Profiled wood imports declined by 5.3%

Latin America exporters gained a 50% share of the US imports of profiled wood.


0

2

4

6

8

10

1997 1998 1999 2000 2001

Billion $

Windows Doors Shingles & shakesOther BJC Profiled softwood Profiled hardwood

Joinery, carpentry and profiled woodMain downturn in Germany (construction crisis) and in Japan.

World imports by product group



Joinery and carpentryMajor importers of builders' joinery and carpentry

USA29%

Germany12%

France4%UK

7%

Japan8%

Others40%



Profiled woodIn 2001, profiled wood imports declined by 5.3%Only Italy and France increased their imports

Major Importers of Profiled Wood, 2001USA31%

France3%UK

5%Japan10%

Germany4%

Others47%



Engineered Wood Products in North AmericaSpectacular and continuous growth of EWP in North AmericaNow covering 5% of structural lumber demand

EWP in North America: Consumption and Projection

0

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

1992 1994 1996 1998 2000 2002 2004 2006

Million BF equivalent

LVL (excluding I-Joists) I-Joists GlulamSource: APA, Regional Production and Market Outlook, APA Economics Report E169, 2003.


Canada5%

Asia20% Europe

6%

USA59%

Australia and New Zealand

10%

1.8 million m3

Engineered Wood Products: LVLGlobal LVL Capacity, 2002

Source: BIS Shrapnel Forestry Group, NZ, 2003


Japan: Gluelam importsJapan is by far the single largest consumer of gluelam

(1.5 million m3 structural gluelam) Imports: 35 % of consumption

Source: Japan Lumber Reports

Japan: Gluelam Imports

0

100

200

300

400

500

600

700

1998 1999 2000 2001 2002

1000 m3

StructuralNon Structural


Laminate flooring: the fastest growing product

Global production of laminate flooring

0

100

200

300

400

500

600

700

1995

1996

1997

1998

1999

2000

2001

2002

2003

*20

04*

2005

*

million m2

Europe North America Other Asia China Projection

Source: M. Krull, Smurfit Munksjo Paper

Solid wood flooring accounts for about 5% of the European market

The share of laminate flooring is growing sharply. The global consumption of laminate flooring increased

from 187 million m2in 1998

to 479 million m2 in 2002.

Europe main producer,with declining share(78 % of total production).


Laminate FlooringConsumption of laminate flooring.

Top 10 countries

0

10

20

30

40

50

60

70

USAChina

Germany UKFrance

CanadaPoland

NetherlandsIberia

Belgium

million m2

200020012003

S ource : M. Krull, S murfit Munksjo P a pe r

Europe is the largest regional market for laminate flooring By country: Germany 29%, UK 23%, France 15%, Netherlands 8%China is the second largest consumer, 85% supplied by domestic production.


Laminate FlooringProduction, consumption and trade

Part of the European production is exported (mostly to North America and China)

North America is heavily dependant on European imports. Consumption of laminate flooring in North America rose from 30 million m2 in 1998 to 96 million m2 in 2002.Forthcoming production capacity extensions in North America, will limit imports from Europe.

Constant increase of Chinese production and consumption and stagnation of imports from Europe.

Consumption and Import of Lamin. Floor

Asia

0

20

40

60

80

100

1995 1996 1997 1998 1999 2000 2001 2002

million m2

Asia production Asia import import

So urce: M. Krull, Smurfitt Muns kjo

Consumption and Import of Lamin. Floor

North America

0

2040

60

80100

120

1995 1996 1997 1998 1999 2000 2001 2002

million m2

N A p ro d u c tio n N A imp o rt

S ourc e : M. Krull, S murfit t Munskjo

Consumption and Export of Lamin. Floor

Europe

050

100150200

250300350400450

1995 1996 1997 1998 1999 2000 2001 2002

million m2

Europe sales Europe export

So urce: M. Krull, Smurfit t Munskjo

million m2Production Export Import


Tropical Value-Added Wood ProductsThe trade of tropical value-added products has increased considerably in the last years. After many years of efforts, lesser known species (LKS) are gaining acceptance in the manufacture and trade of tropical value-added products.Plantation products account for a large share of tropical value-added products The international market of garden furniture, decking and gluelam scantlings is very active Certification is a strategic issue, conditioning investments andexports


Special thanks

to:

• Mr. Jukka Tissari, Wood Products, ITC• Mr. Craig Adair, APA• Dr. Al Schuler, USDA• Dr. M. Krull, Smurfitt Munskjo

for data reported in this presentation

value-added wood products trade...from eastern europe to western europe, mostly to germany p-m...

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