As a result of overproduction the price of wood in Latvia experienced a slight and, possibly, passing price drop. In October the average price of pulpwood dropped by an average of 2%. The price drop also continued dropping in the segment of large and medium-sized coniferous sawlogs.
The latter is mainly die to a drop in manufacture of construction materials. According to the latest data from the Central Statistical Bureau of Latvia for the past nine months, manufacture has dropped by 12.5%. This caused a 4% drop in prices of large pine sawlogs and a 7% drop in spruce thick sawlogs. A price increase was observed in the birch segment, which is normal for the season.
This statistical data is based on information from Latvia’s biggest forest auction system E-silva.
As usual for autumn felling is less available, because many lumber supply roads are inaccessible during rainy weather. This caused an increase in the value of felling sites located near accessible roads. The volume of transactions is considered stable with a tendency to grow. To compensate lacking production volumes, companies that produce wood chips have expanded their arsenal. It should be added that due to certain economic and geopolitical factors, the queue for purchase of equipment may be long.
Because this year’s autumn turned out warm, the heating season has yet to begin properly in Latvia, whereas wood fuel is manufactured in excess, forming reserves.
Warehouses in Latvia are full of wood chips, granules and firewood.
The price of wood fuel was stable in October. But in the first weeks of November there was a slight drop in prices. This drop is potentially temporary. At the same time, the price of wood fuel remains record-high – in recent five months the price of aspen and black alder firewood has increased by an average of 2.8 EUR/m3 a month. The average price of firewood was 80 EUR/m3 at the end of October.
The drop in the sawlog segment is related to the drop in construction volumes in Latvia and other countries. Considering the downward facing tendency observed for coniferous sawlogs, sawmills have decided to lower production volumes, as demand for construction materials on global markets is down. As a result of this the average price of thick pine sawlogs in October dropped to 102.81 EUR/m3. The price reached its peak when it was 114 EUR/m3. The price of thick spruce sawlogs dropped to 95.19 EUR/m3, with the peak price being 104 EUR/m3.
The average price of pine and spruce pulpwood reached 88 EUR/m3 in October, which is 2% lower when compared with the start of September. The price of birch pulpwood increased in October but dropped at the start of November – from 130 EUR/m3 to 127 EUR/m3. This is related to the changes in demand in markets.
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