On a more positive note new investment continues within the UK sawmill trade, BSW have just announced a multi million pound new sawmill line for Fort William, Ransfords are currently installing a new line at Bishops Castle, James Jones are back to full capacity at Lockerbie, these together with many other investments across the UK show that the UK sawmill trade is in robust health and relishing the challenges that lie ahead despite current difficulties.
The small roundwood market is in a similar position to the log market, with a poor market and ample supplies of timber. The board manufacturers are struggling in some sectors, raw chipboard sales are poor whilst MDF and OSB sales helped by export outlets are relatively healthy. Some UK mills are beginning to take production down time to balance production with sales; this is causing an oversupply and quotas on roundwood deliveries. Log yards are generally full but most mills are looking to hold significant stocks following the previous two years experience of severe winter weather that resulted in perilously low stocks of fibre.
The overall picture in the medium term for growers is relatively healthy for industrial round wood, with new potential outlets on the horizon. In particular the new Biomass boiler at Workington due to come on stream later in 2012 will have an effect on wood fibre flow across a wide area. The other new large scale biomass operation under construction is the Tullis Russell/RWE power station at Glenrothes, although largely fuelled by RCF there will be some disturbance to the flow of fibre across the country as some end users who are consuming RCF at the moment will be forced to look at other sources of fibre. These projects combined with the arrival over the past few years of several pellet plants and biomass operated power plants across the UK has provided UK growers with a varied suite of potential outlets to chose from.
The small roundwood fencing market continues to be very healthy across the country with most end users very busy and struggling for supplies, this is one ray of sunshine for growers in the current climate. Prices for fencing stakes and rails continue to be very strong as a limited supply is struggling keep pace with demand. The other sector that provides comfort for growers, especially in the South of the UK is the ever buoyant firewood market where demand constantly outweighs supply and growers are achieving very healthy returns on their hardwood thinnings.
In conclusion, the trade is at a traditional seasonal low at this time of year but is looking forward with some uncertainty towards next spring. However with increasing outlets for forest products whether in export form for logs and roundwood or new sawn capacity or biomass projects within the UK, the forest grower should look forward with optimism in the medium term.
Ashley Williams, Deputy Managing Director