Demand for bars and pallet is also very strong resulting in significant price rises for these products. Customers who had moved into cutting spruce only have now moved back into taking a wider range of species in order to secure sufficient volume, but even so there are too many mills chasing the same sub 16cm top diameter portion of the tree for pallet and fencing products. The recent stormy weather means that the normal fencing demand associated with new house builds will be boosted by repairs to existing fences once the weather improves and the insurance companies approve the work, so it looks like a good year for fencing product demand.
Small roundwood has also been in strong demand, although perhaps this is showing some signs of weakening as the open winter, combined with strong sawmill activity producing high levels of co-products, means the mills are generally well stocked. Both small and large scale biomass operations are now providing an alternative to the traditional markets and helping to maintain good prices. Norbord have announced that they have applied for planning permission for a new continuous press at their Dalcross site which, when combined with their CHP demand, will see a doubling of their intake within the next couple of years which is welcome news for forest owners throughout Scotland.
Whilst the stormy winter here has caused some windblow, most reports so far suggest that it has not caused widespread damage, except across the South-west of England and up into Wales. However, in Sweden, North Germany and Denmark substantial windblow has resulted in plenty of log and small roundwood availability and hence less enthusiasm for export volumes from the UK for the time being. However, the strong domestic demand means that this is not generally a major issue.
With a significant proportion of the harvesting resource now involved in felling infected larch, spruce volumes are very much in demand. We await the Spring flush with a certain amount of trepidation as we will then know the extent of spread of Phytopthora and its effect on the harvesting plans of forest owners for this year. However, even based on the current level of infection, spruce log prices will continue to be good as supply struggles to meet demand.