The middle east conflict and the global wood trade: what the industry is really saying
Freight costs have doubled. Arabian Gulf shipments have stopped for months. Yet demand has not disappeared. Five industry leaders share their ground-level view on what is happening and what comes next.
On 6 May 2026, Fordaq brought together five senior wood industry leaders for a live panel discussion on the situation in the Middle East and its consequences for global timber trade. The session drew more than 1,000 registered participants from 70 countries, a signal of how widely this crisis is being felt.
This is not a transcript or a summary of what was said in the room. It is an attempt to distil the most substantive insights from that conversation into something useful for anyone trying to navigate the next six to twelve months of trading in an environment that is changing faster than most supply chains can adapt to.
The panellists were: Ulf Gabrielson (CEO, UNI4 Marketing, Sweden), Thomas Schauerte (Head of Sales, Ante-holz, Germany), Matti Iso-Kuusela (Sales Director, Versowood, Finland), Hassan Sinno (General Manager, International Timber Company, Saudi Arabia & Lebanon), and Ibrahim Elshal (CEO, Elshal Timber, Egypt). The session was moderated by Fordaq Chairman Sampsa Auvinen.
Panel discussion: Middle East and its impact on global wood industry
The Scale of the Disruption
To understand what the panellists were responding to, some context is necessary. The US-Israel military operation against Iran, which began in late February 2026 and included the assassination of Supreme Leader Khamenei, triggered Iran's closure of the Strait of Hormuz, the narrow waterway through which approximately 20% of the world's seaborne oil and LNG normally passes.
The economic consequences moved fast. US gas prices rose roughly 50% from the start of the conflict. Brent crude reached approximately $112 per barrel. And in March alone, vessel transits through the Strait of Hormuz fell from around 3,000 per month to just 154. An estimated 2,000 ships were stranded in the Gulf. US military authorities indicated it could take up to six months to clear mines believed to have been laid by Iran, even if a full ceasefire holds.
A ceasefire was agreed in early April, but as of the day of the panel, active hostilities continued. The UAE reported that its air defence systems engaged Iranian drones and missiles for the second consecutive day. This is the environment in which the wood industry is attempting to make shipping decisions, sign contracts, and plan production.
Freight: The Variable That Now Defines Competitiveness
If there was one theme that unified every speaker regardless of geography, it was freight. The cost, the unpredictability, and the sheer operational complexity of moving timber into the Middle East today has become the central variable in nearly every business decision.
Ulf Gabrielson, whose company handles MENA sales for three of Sweden's largest producers (SCA, Holmen, and Setra) described a period in which his organisation simply stopped accepting new bookings for over a month. War risk surcharges, which are added on top of already elevated container rates, can effectively double the cost of a shipment. In some cases, carriers are refusing to enter certain zones altogether.
"Freight costs today are determined less by distance and more by risk," was how one panellist framed it. That shift has profound implications for the competitive landscape. South American or New Zealand suppliers who might theoretically benefit from redirected demand face the same elevated risk environment, and in many cases, their lead times make them structurally less competitive than European suppliers who have been operating in this market for decades.
Hassan Sinno, whose company ITCO imports softwood into Saudi Arabia and Lebanon, gave the most concrete account of what disruption looks like on the ground. Arabian Gulf ports, primarily Dammam, have not received a single softwood shipment in over two months. Jeddah, on the Red Sea coast, has become the sole viable entry point for Saudi Arabia. The rerouting adds cost, time, and complexity to every transaction. Containers that left Europe weeks ago are now stranded in India, the UAE, Oman, and Egypt, waiting for clarity that has not yet arrived.
Khor Fakkan port in the UAE is technically accessible, outside the Strait of Hormuz, but panellists described it as prohibitively expensive for timber volumes. The infrastructure exists in theory; the economics do not currently work in practice.
Demand has not gone away, but it has changed shape
One of the most important clarifications to come out of the discussion was the distinction between everyday sawn timber demand and large-scale project demand. These are behaving very differently, and conflating them leads to the wrong conclusions.
Thomas Schauerte of Ante-holz, one of Germany's largest sawmill groups, was direct: buyers in several Middle Eastern markets are running entirely out of stock and willing to take whatever can be delivered. The underlying demand for structural timber, joinery timber, and basic building materials has not evaporated. In some cases it is intensifying, precisely because supply has been so constrained.
What has changed is the project pipeline. Schauerte noted that large infrastructure developments , including flagship projects tied to Saudi Arabia's Vision 2030, have either been downsized or had their timelines extended. NEOM, Masdar City, and similar programmes represent a significant component of regional demand for high-value engineered wood products such as CLT and glulam. That segment of demand is on pause, not cancelled.
The implication for suppliers is significant. Companies focused purely on commodity sawn timber may find more near-term opportunity than those whose business model depends on large integrated projects. Conversely, those with a long-term view on mass timber in the Gulf are watching the project pipeline carefully, and the pause may prove temporary.
Matti Iso-Kuusela of Versowood, Finland's largest sawmiller, offered a supply-side perspective on this. The Middle East, and Saudi Arabia in particular, accounts for roughly 10–12% of Finnish softwood exports, with around half of that going to Saudi alone. Versowood has maintained production at pre-crisis levels, redirecting volumes to North Africa, European packaging markets, and selective Far East destinations. But as Iso-Kuusela noted, rapid reallocation always compresses margins. The industry is collectively absorbing a cost that will not easily be recovered.
Why European Wood Is Not Being Replaced
A question raised repeatedly by participants, both in the pre-session chat and during the live Q&A, was whether the crisis would accelerate a shift toward alternative supply origins. Could South America, New Zealand, or Canada capture meaningful market share in the Middle East if European supply chains remain disrupted?
The panel's answer was clear, and more nuanced than a simple no.
Hassan Sinno addressed this directly: lead time remains the decisive factor. In an environment where logistics are already stressed globally, compounded by the conflict, adding weeks or months to transit time from South America makes the economics unworkable for buyers who are already running out of stock. The same applies to New Zealand, where any calculus on Middle East supply is also being shaped by China's demand trajectory and freight rate differentials in the Pacific.
There is also the question of product specification and established trust. European softwood, particularly Swedish redwood and Finnish pine, has decades of specification history in Middle Eastern construction. Structural sizing, grading standards, and drying specifications are aligned with what contractors and projects require. Substituting an alternative origin is not simply a matter of finding a cheaper container; it requires re-engineering procurement chains that took years to build.
US tariff dynamics are pushing some South American producers to look more seriously at the Middle East, as Sinno noted. But tariffs, like crises, are not permanent features of the landscape. The structural advantages of European supply, including quality consistency, proximity relative to Pacific alternatives, and the depth of existing commercial relationships, are more durable than any short-term pricing window.
Egypt as a resilience story and a hub
Ibrahim Elshal, whose family business has been importing timber into Egypt since 1975, offered a perspective that surprised some in the audience: Egypt is in a more resilient position than many assumed at the outset of the conflict.
Foreign reserve levels have held. Advance payment mechanisms, which were a source of serious difficulty three to four years ago, are now fully operational. And critically, Egypt's geography gives it a role that goes beyond its domestic market. The country is functioning as an active transit and re-export node, receiving timber from Europe via the Red Sea and redistributing both domestically and toward Sudan and GCC markets where direct delivery has become complicated.
This is a dimension of the crisis that rarely surfaces in European industry conversations: the secondary logistics infrastructure that activates when primary routes are blocked. Egypt's position is not simply that of an end market absorbing disruption; it is becoming a processing and redistribution hub, which creates its own set of commercial opportunities for suppliers who understand the geography.
Saudi Arabia: Disrupted, Not Derailed
Despite everything, Saudi Arabia remains the market that every panellist returned to when asked where they placed their confidence for the next twelve months.
Sinno was unambiguous: "Saudi is the engine of the region. No matter what anyone can say, Saudi is the centre." The short-term challenges, including liquidity pressures, the halt of Gulf port operations, and heightened competition among suppliers for reduced freight capacity, are real. But they sit against a backdrop of structural demand that the conflict has deferred, not cancelled.
Vision 2030 is not going away. The ambition to diversify the Saudi economy away from hydrocarbon dependency is, if anything, reinforced by a conflict that has again demonstrated the volatility of oil-price-dependent fiscal models. The long-term demand for construction materials, including engineered timber products for commercial and hospitality projects, remains embedded in government policy and private investment plans.
For Thomas Schauerte, this is where CLT and glulam enter the conversation. Mass timber construction is gaining serious consideration in Gulf markets precisely because it aligns with sustainability objectives and offers construction speed advantages that are relevant to ambitious project timelines. The current pause in large project activity may actually create a window for specification work, getting mass timber products written into tender documents for the next wave of development.
Lebanon, by contrast, occupies a different position. Sinno described it as a market with genuine entrepreneurial strength and resilience, but one that remains acutely exposed to volatility, both from the regional conflict and from its own unresolved political and economic situation. It is a much smaller market, and for businesses that need to allocate limited commercial bandwidth, Saudi Arabia's scale and direction make it the more reliable target.
What This Means Practically
Across the full discussion, several operational conclusions emerged that go beyond the geopolitical narrative:
Relationships now function as supply chain infrastructure. In a disrupted market, buyers are prioritising suppliers who communicate proactively, absorb problems jointly, and offer flexibility on terms. Price alone does not retain a customer when logistics are uncertain.
Surcharges are not going away immediately after a ceasefire. Carriers and insurers will price ongoing risk into rates for months after the political situation stabilises. Any business planning that assumes freight normalisation as soon as hostilities end will be wrong.
Volume reallocation compresses margins sector-wide. When major producers redirect Middle East volumes to Europe or North Africa, they increase competition in markets that were previously in balance. The effects of the conflict are not contained to the affected region.
Oil-based substitutes will become more expensive. Ulf Gabrielson raised a point that deserves more attention: as energy costs rise, the production cost of oil-derived materials, including plastics, composites, and certain adhesives, increases alongside them. Wood, which does not share this cost structure, may find a relative competitiveness advantage in some applications.
Looking Forward
No one on the panel claimed to know how or when the Strait of Hormuz will fully reopen, or what the regional order will look like in twelve months. That uncertainty is honest, and more useful than false confidence.
What the panellists did agree on is that the structural fundamentals of the Middle East timber market, including population growth, urbanisation, ambitious public investment programmes, and a construction sector that has been deliberately diversified away from pure oil revenue dependence, remain intact. The disruption is real and it is costly. But it is a disruption, not a structural collapse.
The companies that will emerge from this period in a stronger position are those that stayed in contact with their customers, maintained supply where logistics permitted, and used the pause in normal trading to deepen the relationships that, in this industry, ultimately determine who gets the call when freight routes reopen.
Full Recording
Watch the Complete Panel Discussion
Panellists
| Ulf Gabrielson CEO, UNI4 Marketing · Sweden | Thomas Schauerte Head of Sales, Ante-holz · Germany |
| Matti Iso-Kuusela Sales Director, Versowood · Finland | Hassan Sinno General Manager, International Timber Company · Saudi Arabia & Lebanon |
| Ibrahim Elshal CEO, Elshal Timber · Egypt | Sampsa Auvinen Moderator · Chairman, Fordaq SA |
About Fordaq
Fordaq SA is Europe's leading B2B platform for timber and wood products, connecting more than 92,000 verified companies across 189 countries. The platform provides trading services, market intelligence, pricing information, and industry news for wood industry professionals worldwide. www.fordaq.com