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MALAYSIA: INCREASE IN PRICE IN THE SAWNTIMBER MARKET

¡¾2002.08.15¡¿

MALAYSIA: INCREASE IN PRICE IN THE SAWNTIMBER MARKET

The Rubberwood sawntimber market has experienced some considerable price increases over the past few weeks. In addition the Government has also announced the imposition of the export levy. It is quite interesting to note the recent development and the various factors involved. On the one hand the weather is good and this period should correspond to the preparation for the "autumn" replanting in the rubberwood plantations and therefore logs from the cleared mature plantations should be abundant. But the fact is that there is rush by manufacturers for the available timber. As a result of this prices have increase by at least 15% and the supply cannot fulfill the demand. The trade is saying that while there has been some increase in orders for rubberwood products this is not the main cause for the almost panic buying. One of the more likely factors could be the foreign manpower issue. Ahead of the amnesty by the Malaysian government, it is believed that quite a large number of foreign workers would have left the country and this has created a shortage of workers for the Rubberwood sawmilling industry. Those mills that have workers are rushing to complete orders immediately incase the labour shortage gets worse.