Demand still weak in international timber market—latest GTI Report
16 June 2023
Meranti logs for plywood production in a log pond in Indonesia. Indonesia’s GTI fell by 5.7 percentage points in May. Photo credit: Faculty of Forestry, Bogor Agricultural University
Yokohama, Japan, 16 June 2023: Tropical timber markets showed no sign of recovery in May and even slumped further in some countries, according to the latest Global Timber Index (GTI) Report. The GTI was below 50% in the seven pilot countries of Brazil, China, the Congo, Gabon, Indonesia, Malaysia and Mexico, indicating negative growth in the sector.
According to the report, Indonesia’s GTI, which had risen above the threshold value of 50% in April, fell by 5.7 percentage points in May, to 44.9%, suggesting that the foundations of recovery in the country’s timber industry remain weak. The Congo’s GTI increased by 9.4 percentage points, to 35.7%, indicating an easing in the rate of contraction in the sector. GTIs were well below 50% in China (35.3%), Malaysia (28.0%), Brazil (32.9%), Gabon (33.8%) and Mexico (44.5%), with no recovery in sight.
The number of new orders for timber and timber products—especially domestic orders—in China declined in May, accompanied by an increase in the inventory of raw materials and finished products.
The main challenges reported by GTI-participating enterprises in the May survey related to decreasing market orders; rising costs, such as for fuel; and a decline in log prices. Companies in Brazil expressed hope of gaining more market recognition for precious tree species such as Toona ciliata and Khaya grandifoliola. Enterprises in Indonesia called for more support from government on financing, export tariffs, international cooperation and other aspects.
GTI pilot countries are paying close attention to the European Union Deforestation Regulation (EUDR). For example, the furniture industry in Brazil is concerned about the risks posed by the proposed legislation. The Sarawak Forestry Industry Association suggested maximizing the use of timber from planted forests to produce high-value-added products such as wood-based panels and furniture.
Download the latest GTI Report here