‘We’re working to get timber a bigger slice of the UK construction pie’

Nick Boulton, Head of Technical and Trade Policy at TDUK, explored the UK softwood market at the recent Global Market Conference, giving his predictions on what lies ahead for 2024.

“There has been turmoil and shock in the market, but UK softwood consumption is increasing and TDUK is working hard to increase the demand and get timber a bigger slice of the UK construction pie,” he said.

Nick began by outlining the current value of the UK’s produced and imported panel products, which was £5.9bn for the full year in 2022. Some £4bn of that figure was imported timber, making it one of the UK’s 40 biggest industries.

Softwoods are by far the largest import group, accounting for around 63% of the imported product mix, or 7m m3 of timber. That’s compared to 14% for plywood, 7% particleboard, and just 5% of hardwoods.

“Softwood consumption reached record levels in 2021 at almost 11m m3, before experiencing a 21% drop during 2022,” Nick said.

Softwood imports have also fallen 25% since 2021’s high point, which itself was a 15% increase on 2020’s levels.

The National Softwood Division’s forecast is that the full 2023 year will see a 5% decline in softwood imports, before a possible 2% rise forecast in 2024.

Nick said: “For UK softwood production, the Forestry Commission are forecasting a fall of 8% during 2023, with output expected to then remain flat in 2024.

“Combining the import and UK production figures allows a forecast of UK softwood consumption to be developed, which indicates a 7% decline for 2023 before a 1% rise in 2024 which is broadly in line with the Construction Products Association’s forecast for next year.”

Nick continued: “We are seeing volume stability returning to the market, which is good news, and the scale of the market peaks and troughs are reducing rapidly.

“We also expect to see price stability returning to more normal levels but, as Olle Berg [in his previous presentation] has already made clear, of more concern is the massive drop in prices we’ve seen. Prices have fallen, but costs and overheads remain high, which continues to be challenging.

“But, looking ahead to 2024 and 2025 we do expect things to stabilise, and the long-term outlook for timber is good when you consider the push towards more net-zero construction.”