06 Aug 2009
A UN study says the economic crisis has pushed the European and the US forestry sectors into deep recession.
The joint report by the UN Food and Agriculture Organisation and the UN Economic Commission for Europe said consumption, production and trade of forest products feel slightly in 2007 after reaching record highs in 2006. In 2008 that decline accelerated and continued into the first half of this year, making it the deepest decline since the first oil shock of 1973.
The 56-country UNECE, whose membership includes the United States and Canada accounts for nearly half of global forests, and the region is also the largest global producer, consumer, exporter and importer of wood and paper products.
The study pointed to marked distinctions between the three UNECE subregions, with consumption marking 3 per cent growth in the Commonwealth of Independent States.
However, with forest products markets primarily driven by housing construction requiring lumber, which tumbled dramatically in North America and Europe, consumption plummeted by nearly 13 per cent and almost six per cent, respectively, it said. From a peak of 2.2 million new homes in 2006, new constructions took a nose-dive, falling 25 per cent in 2007, 34 per cent in 2008 and an estimated 50 per cent this year.
Although more houses continue to be built in the CIS, the pace has softened, the agencies said. The fall in demand has pushed the real prices of building materials to their lows since the 1940s, while the paper sector is also falling deeper in to crisis, with production in Europe, North America and the CIS all reporting declines.
However, the report noted that the wood energy sector seems to be immune to the current economic downturn, as demand for renewable energy sources, such as wood biomass, continues to steadily climb thanks to government policies towards climate change mitigation and energy security.
