Very difficult trading conditions prevailed in West Africa.
Although there has been relative stability in prices, this
remains very much a function of low or no trade rather
than an indication of normal business conditions. Steady
buying for China has been perhaps the major stabilizing
factor, although prices have been held at the current lower
levels and are unlikely to improve in the short-to-medium
term. Okan has been in better demand and prices have
been higher by around EUR10-15m³. Other than this, there
have been no price changes reported. Okoume has been
selling, but volumes are well below what would have been
considered normal in the early part of the year. Mill
closures and reductions in staff are still being made. One
large group in West Africa has closed a veneer mill
because of low demand and build up of unsold stock, due
in part to reduced furniture manufacturing activity and
exports of veneer in Italy.
Other mills remain closed and companies are uncertain
and nervous about trade prospects for the remainder of the
year. Sawn lumber prices have appeared to be holding
steady because of low trading volumes, rather than any
real firmness in the market. Buying has been very slow
and selective. Sapele has not made any recovery from its
decline in demand and price. Reports indicate that sellers
are taking very low offers to move stock and buyers are
still reluctant to give shipping instructions for their
overlying, previous contracts.
It is certain that the full effects of the financial crises in the
US and UK are still to be felt in building construction and
housing, and in furniture manufacturing and sales. The
timber supplying sector is likely to be more seriously
impacted as it seems inevitable that the house building
slump will worsen and furniture sales will decline over the
final quarter of the year and well into first quarter of 2009.
