According to the Tropical Timber Market Report the total UK tropical wood and wood furniture imports in 2020 were USD981-million, 23% less than the previous year.
The UK was amongst the world’s worst affected countries by the Covid-19 pandemic last year. At a time when there was already uncertainty due to the country’s departure from the EU, it is no surprise that imports fell so precipitously.
The decline in UK imports of tropical wood and wood furniture in 2020 was concentrated in May and June when imports fell to around 50% of the normal level. After recovering sharply between July and October, imports fell 5% to USD100-million in November and by a further 7% to USD89-million in December.
The slowdowns in 2020 coincided with the initial Covid-19 lockdown in Q2 2020 and a second lockdown in Q4 2020 as another more severe wave of the virus hit in the winter months.
A concern for tropical suppliers is that timber product imports from tropical countries suffered a disproportionately large share of the decline. There are, however, reasons to believe that the downturn in the UK market last year may be only temporary and that new opportunities for tropical suppliers will open up in the emerging post-Brexit trading environment. The scale of the in 2020 downturn was strongly influenced by supply side issues.
UK demand for all wood products has proved to be more resilient than expected during the pandemic and importers are widely reporting that the main obstacle to trade at present is lack of availability. The problems of shipment and rising costs of freight have been particularly intense from South East Asia, a factor which should ease gradually as trade flows begin to normalise this year.
While Brexit is likely to act as a significant drag on economic recovery in the UK, at least in the short- to medium-term, there are signs that the relatively thin trade agreement reached between the UK and the EU in the closing days of 2020 may help level the playing field for non-EU wood suppliers in the UK market relative to EU competitors. This has particular significance for hardwood products since the UK, unlike the rest of EU, has only a very limited domestic hardwood resource, while the broader wood processing and furniture manufacturing industries are also relatively small in international terms. The country has always been very heavily dependent on imports for wood supply and now has a strong incentive to build stronger trade links with countries outside the EU.
First published in the Tropical Timber Market Report