Myanmar: Trade Cautions on Volumes for Tender
Market conditions remain unchanged from the time of the previous report. 2012 has been an important year for Myanmar teak. The recession in the West has had a disturbing influence on the teak trade. The huge domestic market for teak in India remains strong mainly because teak is indigenous to India and therefore has a special place in the minds of consumers. Other markets that purchase teak, mainly for re-export have shown signs of weakening over the past few years.
2012 has not been a good year for the timber traders in Myanmar and all are looking for the market to pick up during the middle of 2013. A report by one experienced timber trader on the November teak tender is quoted below: €Because of short supply, the prices for fair and good decent parcels are still holding to the normal market prices. Other poor and average quality parcels are below the normal range of prices.
Anyway, in general, the prices for this month are slightly better than last month, because of the very small quantity put on sale. The seller (MTE) should be careful that if too small quantities are put up for sale, the general interest in Teak might fade away. It is important to supply the market with a reasonable quantity, to keep commercial interests.€ The above comment relates to the very small quantity of teak logs put up for sale in the recent months compared to the 5000+ton monthly offers in the past many years.
Sellers versus buyers' market
Some analysts even went on to comment that teak has lost ground and the market is now a Buyers' market. Price fixing; controlled delivery schedules and counter-offers on specifications used to be the prerogative of the sellers in the years prior to 2000. Now, sellers no longer enjoy these privileges and have to yield to buyers' demands. Analysts said this reference relates to natural forest teak only, as they consider €plantation teak' as a commodity only like any other timber.
The same trade analyst expressed the hope that Myanmar would gradually scale down the harvesting of teak, for economic reasons and also for preserving a timber which is considered a national heritage. Further, he suggested that Myanmar should do some serious restocking in the natural forests. Some opined that, more serious and responsible checks should be in place to protect this special timber from irresponsible harvesting. Conservationists view with concern the growing shipment of large quantities of teak logs of smaller dimensions and poorer grades.
What now for Myanmar teak?
There are rumours circulating that the MTE monopoly on timber (including teak) extraction may be withdrawn. When more information on this emerges it will be reported. The history of teak extraction by State agencies goes back a long way. The State Timber Board (STB) - the precursor to the now Myanmar Timber Enterprise (MTE) - was formed under the State Timber Board Order 1948 and the State Timber Board Act of 1950.
STB handled all teak extraction from that period on. Milling of teak was done by the State sawmills. Private sawmills were also allowed to purchase teak logs in the STB auctions; mill them and sell in on the domestic market. They were also permitted to export. In 1964, all remaining non-teak hardwood activities were nationalised and operated solely by the state. By the 1990's MTE has started relinquishing its monopoly on teak exports and also on the extraction of non-teak hardwoods.
Teak plantations were permitted for private entrepreneurs in 2004. By 2012, a major portion of MTE's timber extraction was being done by private companies. The first decade of the 21st century is witnessing significant changes in the Myanmar forestry sector. In the words of the ITTO correspondent in Myanmar €Whither goest Myanmar teak?' 2013 may provide an answer.
2012 has not been a good year for the timber traders in Myanmar and all are looking for the market to pick up during the middle of 2013. A report by one experienced timber trader on the November teak tender is quoted below: €Because of short supply, the prices for fair and good decent parcels are still holding to the normal market prices. Other poor and average quality parcels are below the normal range of prices.
Anyway, in general, the prices for this month are slightly better than last month, because of the very small quantity put on sale. The seller (MTE) should be careful that if too small quantities are put up for sale, the general interest in Teak might fade away. It is important to supply the market with a reasonable quantity, to keep commercial interests.€ The above comment relates to the very small quantity of teak logs put up for sale in the recent months compared to the 5000+ton monthly offers in the past many years.
Sellers versus buyers' market
Some analysts even went on to comment that teak has lost ground and the market is now a Buyers' market. Price fixing; controlled delivery schedules and counter-offers on specifications used to be the prerogative of the sellers in the years prior to 2000. Now, sellers no longer enjoy these privileges and have to yield to buyers' demands. Analysts said this reference relates to natural forest teak only, as they consider €plantation teak' as a commodity only like any other timber.
The same trade analyst expressed the hope that Myanmar would gradually scale down the harvesting of teak, for economic reasons and also for preserving a timber which is considered a national heritage. Further, he suggested that Myanmar should do some serious restocking in the natural forests. Some opined that, more serious and responsible checks should be in place to protect this special timber from irresponsible harvesting. Conservationists view with concern the growing shipment of large quantities of teak logs of smaller dimensions and poorer grades.
What now for Myanmar teak?
There are rumours circulating that the MTE monopoly on timber (including teak) extraction may be withdrawn. When more information on this emerges it will be reported. The history of teak extraction by State agencies goes back a long way. The State Timber Board (STB) - the precursor to the now Myanmar Timber Enterprise (MTE) - was formed under the State Timber Board Order 1948 and the State Timber Board Act of 1950.
STB handled all teak extraction from that period on. Milling of teak was done by the State sawmills. Private sawmills were also allowed to purchase teak logs in the STB auctions; mill them and sell in on the domestic market. They were also permitted to export. In 1964, all remaining non-teak hardwood activities were nationalised and operated solely by the state. By the 1990's MTE has started relinquishing its monopoly on teak exports and also on the extraction of non-teak hardwoods.
Teak plantations were permitted for private entrepreneurs in 2004. By 2012, a major portion of MTE's timber extraction was being done by private companies. The first decade of the 21st century is witnessing significant changes in the Myanmar forestry sector. In the words of the ITTO correspondent in Myanmar €Whither goest Myanmar teak?' 2013 may provide an answer.
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