The United Nations Economic Commission for Europe (UNECE) just released the UNECE/FAO Forest Products Annual Market Review, 2003-2004. It covers forest products market and policy developments in the UNECE region of Europe, North America and the CIS countries. Its main findings are:

• Forest products markets rose to new records overall in the UNECE region (up 1.3% to 1.3 billion m3) as evidenced by the second consecutive year of rising consumption; however, this development was not universal among all subregions, nor among all products.
• Approaching two million housing starts in 2003, the United States was the engine for demand of forest products, both primary and secondary, in the UNECE region, while outside the region Chinese and Japanese imports soared for temperate and tropical wood.
• China’s exports of value-added wood products, especially furniture, have increasingly impacted markets in the UNECE region, and in mid-2004, the US imposed anti-dumping duties of up to nearly 200%.
• Concern for the origins of wood products imported into the UNECE region, and increasing awareness of illegal logging, led government agencies, industry associations and international organizations to initiate measures to curb the trade in such products.
• Certified forest products markets are being driven, in part, by government purchasing policies that ensure sustainable forest management and legality of the source of their purchases.
• Wood energy promotion policies and record high oil prices resulted in heightened consumption of wood for energy; however, the pulp and panel sectors are concerned about raw material costs.
• Sawn softwood demand rose strongly in western Europe (up 5% to 79 million m3) and Japan in 2003 and European exporters profited, while in the US, imports continued to rise, despite a weak dollar, benefiting traditional Canadian exporters as well as European and other offshore sources.
• Despite rhetoric to reduce tariff and non-tariff barriers, the ongoing sawnwood trade dispute between Canada and the US continues and the EU has imposed some punitive tariffs that have affected wood and paper products markets.
• The sawn hardwood sector strengthened with rising demand and prices in the US and Europe, fuelled by increased housing starts in Europe and North America.
• Panel markets benefited from rising demand, achieving consumption records (up 17% in Russia, up 14% in central and eastern Europe, up 4% in western Europe and up 1% in North America), and higher prices; however, the competition is fierce in this global market for commodity products.
• Paper consumption climbed strongly, by 5%, in central and eastern Europe and in Russia by 12%; however, western Europe demand remained steady, and North American demand continued to erode.

The Forest Products Annual Market Review begins with an overview of forest products markets and policies, followed by a chapter focusing on policy issues related to forest products markets. These are followed by analyses of the economic factors affecting the forest and forest industries sector.

Statistics-based chapters are included for markets of sawn softwood, sawn hardwood, wood-based panels, paper, paperboard and woodpulp, wood raw materials and tropical timber. Other chapters highlight the rapid developments in forest products certification, as well as value-added wood products, e.g. furniture. The Review concludes with a chapter on tropical timber markets.

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