Central/West Africa: Log ban comes into effect
- May 25, 2010
- • Source: ITTO's Tropical Timber Market Report
- • Views: 8137
The log export ban in Gabon takes effect as planned from midnight on 15th May. This puts an end to speculation about when the ban would come into force. Producers and traders in the region will now have to adapt to the new market conditions.
The situation is causing some unrest among the labour unions that this will inevitably lead to unemployment in the timber industry. According to reports, the port workers are already taking strike action and reports suggest that other labour unions are also considering similar action.
In the meanwhile, the industry is determining how to proceed given the current conditions in the sawn and processing markets. It is clear that current sawn lumber prices may have to rise in line with the recent surge in log prices. Exporters of further processed products have experienced even more difficult market conditions this year, as shown by the decline in exports of processed products from Ghana in particular, as well as from other West African producers.
Producers in Gabon say that much of their logging and transport equipment will be made redundant by the log export ban. For some, this would be around 50% of their total logging bulldozers and log haulers.
Local transport companies including the railways are expected to be hard hit by the removal of 1million tonnes of annual freight.
Although it is not possible for the time being to quantify any changes in log prices, some species such as okume, okan and tali have already experienced increasing prices before the ban.
The producers and traders in the region are now adapting to the new market conditions and planning their future production and market strategies. The log importing countries will also have to determine how to adapt to the reduced availability of logs from W. Africa.
Prices difficult to determine
Most of the very active log trading in the West and Central African region is centred in Cameroon and there has been frenetic bidding for all kinds of logs.
Sellers are insisting that depending on the total value of each transaction, a large proportion of the purchase price must be paid in advance and in cash. The balance is required immediately against the bills of lading.
These rather ad-hoc transaction methods make the determination of the current price levels very difficult. However, it is estimated that prices of most species are up by at least €5 - €10 per cu.m and still rising due to strong demand from buyers mainly for China and India. Also, demand in Europe is showing some slight improvement.
Central/West Africa
The situation is causing some unrest among the labour unions that this will inevitably lead to unemployment in the timber industry. According to reports, the port workers are already taking strike action and reports suggest that other labour unions are also considering similar action.
In the meanwhile, the industry is determining how to proceed given the current conditions in the sawn and processing markets. It is clear that current sawn lumber prices may have to rise in line with the recent surge in log prices. Exporters of further processed products have experienced even more difficult market conditions this year, as shown by the decline in exports of processed products from Ghana in particular, as well as from other West African producers.
Producers in Gabon say that much of their logging and transport equipment will be made redundant by the log export ban. For some, this would be around 50% of their total logging bulldozers and log haulers.
Local transport companies including the railways are expected to be hard hit by the removal of 1million tonnes of annual freight.
Although it is not possible for the time being to quantify any changes in log prices, some species such as okume, okan and tali have already experienced increasing prices before the ban.
The producers and traders in the region are now adapting to the new market conditions and planning their future production and market strategies. The log importing countries will also have to determine how to adapt to the reduced availability of logs from W. Africa.
Prices difficult to determine
Most of the very active log trading in the West and Central African region is centred in Cameroon and there has been frenetic bidding for all kinds of logs.
Sellers are insisting that depending on the total value of each transaction, a large proportion of the purchase price must be paid in advance and in cash. The balance is required immediately against the bills of lading.
These rather ad-hoc transaction methods make the determination of the current price levels very difficult. However, it is estimated that prices of most species are up by at least €5 - €10 per cu.m and still rising due to strong demand from buyers mainly for China and India. Also, demand in Europe is showing some slight improvement.
| West Africa logs, FOB | € per m³ | ||
| Asian market |
LM
|
B
|
BC/C
|
| Acajou/ Khaya/N'Gollon |
205
|
205
|
153
|
| Ayous/Obéché/Wawa |
190
|
190
|
145
|
| Azobe & Ekki |
200
|
200
|
122
|
| Belli |
230
|
230
|
-
|
| Bibolo/Dibétou |
140
|
130
|
|
| Bubinga |
580
|
510
|
390
|
| Iroko |
257
|
250
|
200
|
| Okoume (60% CI, 40% CE, 20% CS) |
200
|
-
|
-
|
| Moabi |
270
|
270
|
206
|
| Movingui |
180
|
145
|
140
|
| Niove |
130
|
130
|
-
|
| Okan |
290
|
290
|
135
|
| Padouk |
350
|
325
|
235
|
| Sapele |
220
|
220
|
155
|
| Sipo/Utile |
260
|
240
|
190
|
| Tali |
250
|
250
|
114
|
| Okoume |
C1 160 |
CE 150 |
CS 115 |
| West Africa sawnwood, FOB |
€ per m³
|
|
| Ayous | FAS GMS |
300
|
| Okoumé | FAS GMS |
370
|
| FAS. fixed sizes |
340
|
|
| Std/Btr GMS |
275
|
|
| Sipo | FAS GMS |
475
|
| FAS fixed sizes | 320 |
|
| FAS scantlings |
490
|
|
| Padouk | FAS GMS |
540
|
| FAS scantlings |
490
|
|
| Strips |
300
|
|
| Sapele | FAS Spanish sizes |
380
|
| FAS scantlings |
460
|
|
| Iroko | FAS GMS |
430
|
| Scantlings |
440
|
|
| Strips |
350
|
|
| Khaya | FAS GMS |
380
|
| FAS fixed |
420
|
|
| Maobi | FAS GMS |
415
|
| Scantlings |
440
|
|
| Movingui | FAS GMS |
295
|