Europe

For information on the new European Union Timber Regulations, please see click here.
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General Economic Background – With a GDP of over €12.894 trillion (US$16.566 trillion) in 2012, the European Union (EU) has the largest economy in the world. GDP growth in 2012 was -0.2% and the outlook for the remainder of 2013 and into 2014 is continued negative to sluggish growth. Even the previously buoyant German economy showed negative GDP growth (-0.6%) in the last quarter of 2012.

Housing starts are depressed, with virtually every country registering a reduction in starts in 2012 over 2011, with the exception of Germany, which saw an increase in starts of 3.3%. House prices fell by 2.5% (Q3 2012) in the Eurozone and by 1.9% (Q3 2012) in the EU 27. Spain, with a substantial overhang of unsold properties left over from the speculative boom pre 2008, saw the largest decrease in price of -15.2%.

Trade Data – US Exports of softwood lumber to the EU were $20.58 million in 2012 ($31.82 million in 2011). The UK was the largest importer with $5.98 million, followed by Italy ($3.92 million), Germany ($2.75 million), France (41.94 million), Belgium ($1.81 million) and Spain ($1.73 million).

SWOT Analysis

Strengths: High quality, sustainable products and forestry. Reputable and trusted sources of supply and suppliers. American forest practices are among the most stringent in the world and more needs to be made of this as a marketing and trade advantage.

Weaknesses: A reluctance to emphasize that PEFC and SFI certified lumber is available and equivalent to FSC. Strong dollar; strong prices of softwood products in US domestic market which push up prices for export material.

Opportunities: There is a possibility that the EUTR may open up new trading opportunities as substitutes for tropical hardwoods unable to prove that they have been legally sourced and harvested.

Threats: Continued strength of the dollar and continued strength of demand for lumber in US domestic markets.

SEC has consultants stationed in the UK and Spain to help members navigate market opportunities.