As we approach the end of 2024, the timber industry is facing a challenging landscape that deviates from the anticipated boom year that many had hoped for. Analysts are predicting that the fourth quarter will continue to be weak, with early estimates for the first quarter of next year also being revised downward. However, there is a glimmer of hope on the horizon for 2025, as experts foresee a potential turnaround in the market.
Oskar Lindström, an analyst at Danske Bank, believes that the industry is currently at the bottom of the economic cycle. He anticipates a noticeable impact in the fourth quarter of 2024 and the first quarter of 2025. Despite this, Lindström remains optimistic about the future, stating, “I believe that we will see a better market with improved supply and demand balance next year.”
On the other hand, Ola Södermark, an analyst at Kepler Cheuxreux, shares a more cautious outlook, suggesting that while the industry may be close to hitting rock bottom, a strong recovery is not expected in the coming months.
Johannes Grunselius, an analyst at DNB, predicts an increase in prices for both sawn timber and pulp. He attributes this to the overall lack of margins in the former and anticipates that China’s mysterious halt in orders will soon come to an end. “The negative cycle is turning around,” Grunselius confidently asserts.
Looking ahead to 2025, industry players are bracing themselves for a shift in market dynamics. While the immediate future may be fraught with challenges, there is a sense of cautious optimism that the timber industry will weather the storm and emerge stronger in the coming year. Stay tuned for more updates on this evolving story.