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The economic impact of the coronavirus pandemic and the measures adopted to try and slow its spread are having a huge impact. The following survey offered by correspondents in tropical timber producing countries tries to clarify the consequences of the coronavirus crisis on Ghana’s timber industry.

1. Are mills still operating?

Mills in the country with available raw materials and orders are currently in production, as government announced COVID-19 measures, so far, were specific and restricted to the movement of persons. The measures exempted the production and movement of goods and essential services. Factory workers who show evidence of any form of IDs were not affected by the movement restrictions but expected to comply with social distancing.

These are measures by Executive Instrument (EI) imposed under EI 64 and EI 65 on Public Gatherings and restricted movement of persons within selected zones respectively.

2. Have workers been laid off?

No timber sector workers have been laid off as at the time of this report. Ghana employs about 1.2 million workers, of which 600,000 are public sector workers. The remaining are either self-employed or with private investors.

All public and private schools in the country were the first to be closed down by government on 16 Mach 2020. Recently unconfirmed scanty reports indicate, some private school teachers have either been laid off, about to be laid off or may not be paid for the period at home.

3. Are laid off workers receiving payments?

There are no known lay offs in the public sector so workers are still receiving their wages and salaries. Government has also already announced 3-months various levels of water and electricity reliefs for Ghanaians, stressing on judicious of these utilities.

It is anticipated with these measures, employers who do not meet production targets could likely reconsider cutting down on workforces. This will also depend on the availability and sustainability of packages promised by government.

4. Are companies already receiving govnment support?

The Government has recently received parliamentary approval to spend an additional GHC1.2 billion (or US$210 million) for 2020 (April to June) to support businesses, and to minimise job loses.

The government has promised some financial support but companies are yet to know the fine details of who will benefit or not and how much. Government has also pushed forward the payment of taxes and VAT.

Government also plans to support companies by absorbing 100% water and 50% electricity tariffs for the months of Apr to Jun.2020. These are expected to reflect on their month end bills. The Ghana Association of Bankers has also announced a 2% cut in interest rates on loans.

5. Have orders (domestic/international) been cancelled?

Mills outside the lockdown zones are currently producing for both the domestic and international markets. Ghana announced its COVID-19 case just last month. The Timber Industry Development Division (TIDD) of the Forestry Commission (FC) continued to process and approve contracts for export.

6. Estimated % change in shipments since Jan 2020 to China/EU/US/Others

Wood product shipments have not suffered any setback. However, arrivals at destinations in China, EU, US and others could suffer delayed port clearance and possible demurrage depending on each destination. But as cargo is in port this could also help eliminate any anticipated shortfalls by the final consumer.

7. Are mill stock levels increasing?

Factories largely produce to market rather than to stock. The only challenge is production run could take a little more time to complete, due to social distancing which could affect the number of shift workers at any particular point in time.

8. How much time would be required to ramp up production to pre-crisis levels?

Depends on the factory and its outstanding orders, all things being equal with raw materials availability, production levels could be raised within 3-months.

9. What will be the main challenges in ramping up production?

Cash flow, if factories have incurred overheads beyond their control from putting in place the appropriate measures and the required Personal Protective Equipment (PPEs) to combating workplace virus spread.

10. Are containers still being loaded at the port?

Despite land border closures to people and goods the Ghana Ports and Harbours Authourity (GPHA) continue to handle all sea import and export cargoes through the port. Shipping line vessels also call the ports as scheduled without any interruption.

Meanwhile protocols on social distancing and movement of persons are strictly enforced.

11. Are containers readily available?

Yes, with the scheduled vessel calls empty containers are discharged on arrival for subsequent shipments.

Prices for Ghana’s exported wood products are the following between 16-3o April 2020:

Boule Export prices

Euro per m3
Black Ofram 330
Black Ofram Kiln dry 420
Niangon 579⇑
Niangon Kiln dry 622

Export Sawnwood Prices

Ghana Sawnwood, FOB EURO per m³
FAS 25-100mm x 150mm up x 2.4m up Air-dried Kiln-dried
Afrormosia 860 925
Asanfina 465 564
Ceiba 404 600
Dahoma 413⇓ 444⇓
Edinam (mixed redwood) 520 651
Emeri 465 591
African mahogany (Ivorensis) 930 1016⇑
Makore 740 817⇑
Niangon 620 666
Odum 649 865
Sapele 720 797⇓
Wawa 1C & Select 420 458⇓

Export Rotary Veneer Prices

Rotary Veneer 2mm and up,
FOB
EURO per m3
CORE (1-1.9mm) FACE (>2mm)
Ceiba 380⇑ 440
Chenchen 540 633⇑
Ogea 521 590
Essa 586 634⇓
Ofram 350 435

NB: Thickness

Export Sliced Veneer Prices

Sliced face veneer FOB Euro per m3
Asanfina 787⇓
Avodire 667
Chenchen 644⇓
Mahogany 2078⇑
Makore 1621⇑
Odum 700⇓

Export Plywood Prices

Plywood, FOB EURO per m3
Ceiba Ofram Asanfina
4mm
328⇑ 580 641
6mm
412 535 604
9mm
377 446 560
12mm
510 450 480
15mm
450 352⇓ 430
18mm
450 441 383

Grade AB/BB would attract a premium of 10%, B/BB 5%, C/CC 5% and CC/CC 10%.

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