Market News and Special Offers
Latest update 02/02/2017
Since the last market report in November, supply from the Baltics has remained difficult.
The UK economic data has remained good, but with the uncertainty of Brexit the sterling Exchange rate to Euro has remained weak at around Eur 1.15/1.16. This has kept imported prices firm. Whilst we expected good supply over December, a combination of poor weather and bad log supply have combined to tighten supply.
It seems also that the gradual firming of oil prices over the course of 2016 has put pressure on manufacturing costs and freight, so all suppliers are looking for price increases.
Ships have become more expensive, with freight levels increasing by £2 to £3 per m3. This we believe will become a little easier as we move into Spring as some of this is a reaction to Winter weather.
Demand for pallets and packing cases are good as the weakness of sterling has encouraged exports, but domestic demand is also good as the stronger than expected economy and particularly building activity have been maintained. Usually demand for pallets for the building industry increases during March and April, so we are expecting price increases of around 5 to 6% for this period.
Galleywood will do all it can to maintain good stocks during this difficult period and will regularly update stock on our website.
Imported prices for both hardwood and softwood have indeed increased since Brexit as the options on forward currency have been used up.
Fortunately, predictions of a deterioration in the performance of the UK economy has not materialised, and the weak performance of the sterling has helped exports. As such, demand for pallets and crates has remained high which has helped manufacturers to have the confidence to pay increased prices and keep supply coming from the Baltics.
Still the price pressure from sawmills is upward, but as we approach Christmas, it’s unlikely that short term demand will increase.
We believe supply will remain difficult for the first quarter of 2017, and see no reason why demand will not be strong.
Adam and Jim are travelling to Latvia on Sunday 13th November to speak to our suppliers, and will have a more detailed picture of the supply situation.
15 x 70 x 1200
30 x 70 x 1200
90 x 90 x 2400
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