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The downturn in EU imports of wood and wood furniture products during the initial period of the COVID-19 pandemic may be less severe than first forecast. As expected, EU27 (i.e. excluding the UK) tropical wood and wood furniture product imports fell sharply in May in response to supply side problems and the lockdown measures in most of the main EU markets, losing around one third of value against the five-year average for the month.

However, imports were already recovering in June, a month which in a more typical year is when imports tend to slow before the summer holiday period (Chart 1). Imports during June were only around 20% below the 5- year average for that month. In total, EU27 imports of all tropical wood and wood furniture products in the first half of 2020 were US$1.49 billion, 17% less than the same period in 2019.

There is a reasonable chance that, if the recovery continues over the summer months, overall imports of tropical wood and wood furniture in 2020 will not be too far below 2019 or the five-year average.

This does assume, however, that there is no significant uptick in COVID-19 cases in the EU with the onset of winter leading to widespread resumption of lockdown measures. As things stand, there is a still concern in the EU about the possibility of a second wave.

More positively, anecdotal reports suggest that the DIY sector in the EU remained quite buoyant in some countries throughout the lockdown months with many people taking the opportunity to carry out home improvement work. In those EU countries with less stringent lockdowns, such as the Netherlands and Sweden, commercial construction and some manufacturing activity also continued, at a slower pace but without interruption.

Another reason for optimism is the agreement reached between the leaders of the 27 EU Member States at a summit on 21st July 2020 on a comprehensive fiscal stimulus package worth €1.85 trillion over the next seven years.

The package consists of a €1.1 trillion budget, 30% of which will be spent on tackling climate change, and a further €750 billion in grants and loans, all of which must be tied to meeting the bloc’s carbon emission-cutting targets. This has potential to create new market opportunities for timber products in the EU.

EU27 tropical wood furniture imports down in the first half of 2020

The path of decline and recovery in EU27 tropical wood and wood furniture imports varied widely between product groups (Chart 2). EU27 imports of tropical wood furniture started the year strongly but fell sharply in April and May with only a slight recovery in June. Total EU27 wood furniture imports from the tropics in the second quarter of 2020 were 19% less than the average for the same period in the previous 5 years.

At US$616 million, EU27 imports of tropical wood furniture in the first six months of 2020 were 12% less than the same period last year.

EU27 imports of tropical sawnwood were already weak in the first quarter of 2020 and remained at a historically low level in the second quarter. Total EU27 sawnwood imports from the tropics in the second quarter of 2020 were 21% less than the average for the same period in the previous 5 years.

At US$320 million, EU27 imports of tropical sawnwood in the first six months of 2020 were also 21% down on the same period last year. In quantity terms, the EU27 imported 382,000 m3 of tropical sawnwood in the first six months of 2020, 21% less than the same period last year.

EU27 imports of tropical hardwood decking/mouldings started the year particularly slowly and were just building momentum when the lockdown measures were first implemented in March. This led to imports falling sharply in May and June. EU27 imports of decking/mouldings during the second quarter of 2020 were 8% below the average for the same period in the previous 5 years.

At US$139 million, EU27 imports of tropical hardwood decking/mouldings in the first half of 2020 were 23% less than the same period last year. In quantity terms, the EU27 imported 88,500 tonnes of tropical decking/mouldings in the first six months of 2020, 17% less than the same period last year.

EU27 imports of hardwood veneer from the tropics fell very sharply in May, to only around 50% of the long-term average for that month but recovered ground quickly in June. Overall EU27 imports of tropical hardwood veneer in the second quarter of 2020 were 21% below the average for the same period in the previous 5 years.

EU27 imports of tropical hardwood veneers were US$89 million in the first half of 2020, 14% less than the same period last year. In quantity terms, the EU27 imported 140,000 m3 of tropical veneer in the first six months of 2020, 10% less than the same period last year.

EU27 imports of joinery products from the tropics (much of which comprises laminated window frames and kitchen tops, together with finished doors) held up well during the COVID lockdown period, with no significant decline in May and June.

Overall EU27 imports of tropical joinery products in the second quarter of 2020 were only 6% below the average for the same period in the previous 5 years. The EU27 imported tropical joinery products with a total value of US$81.2 million in the first six months of 2020, 24% less than the same period last year.

EU27 imports of tropical plywood, already declining before the lockdown period, fell sharply in the second quarter of 2020, 22% below the average for the same period in the previous 5 years. EU27 imports of tropical plywood were US$67.4 million in the first half of 2020, 29% less than the same period in 2019. In quantity terms, imports of tropical plywood were 112,000 m3 in the first six months of 2020, 28% less than the same period last year .

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