The first-quarter recovery in demand for veneers ground to a halt in April. Order intake from the furniture industry, in particular, has softened in recent weeks, primarily due to falling orders by Ikea suppliers and production facilities owned by the Ikea group. Insiders in the veneer sector believe that these companies will first have to await the results of a call for tenders issued by the Swedish giant, which are expected to come in the next few weeks. Veneer producers expect that this phase of uncertainty will persist until Ikea reveals the outcome of its call for bids at the end of June. Veneer deliveries to Ikea’s own production facilities are also falling short of producers’ expectations. The company reached agreements on prices and possible delivery volumes with a handful of European veneer producers after an autumn 2011 call for tenders for raw veneers, which covered up to two thirds of Ikea’s needs. However, Ikea had taken delivery of much less raw veneers than had been anticipated in the past few months.

Source: EUWID

Posted and edited by Riona, Hanbao News Department

Contact: rionach@cltimber.com