This article was first published in the Tropical Timber Market Report
Heavy rains and the economic impact of Covid-19 continue to disrupt the harvesting and transportation of timber products in several Central and West African countries.
Timber and wood companies in the Central African Republic (CAR) are becoming concerned as log stocks are accumulating in the forest and stocks of sawnwood are building up because of delays in transport to the port in Cameroon.
Cameroon has not been spared the continual rain which, along with Covid-19 control measures, is hampering business operations. However, many of the mills are slowly ramping up production but face a log shortage.
Chinese mills in the region are trying to penetrate markets in Europe for sawnwood as demand in China is slow. Instead of milling the popular species for the Chinese market they have switched some production to milling padouk, azobe and other species for the European markets.
Some producers in Gabon have expressed concern that, as the European winter approaches, the usual decline in orders will leave them with higher than normal stocks. One of the major Chinese mills in Gabon is apparently considering opening a sawnwood stockyard in Europe.
News from the Republic of the Congo is that the quota system is failing in the face of weak demand for sawnwood. The economy in the Congo is in bad shape and finance provided by the World Bank has already been exhausted. The export quota system is a handicap at present as mills are only operating at around 50% of capacity such that they cannot produce enough sawnwood to earn the log export quota. The reduction in milling has also resulted in many workers being laid off.
The chairman of the Forest Industries Association of Ghana says the industry has been suffering from the impact of Covid-19 on demand in international, especially Asian markets. He pointed out that companies have been doing their best to maintain their workforce even in the face of drastically reduced earnings.
The Association has called on the government consider support as the tax burden at this time is overwhelming many companies and has called on the Ghana Revenue Authority to offer tax relief and has asked the Forestry Commission to suspend levies on the industry.