Timber prices on the rise: traders

WHILE the prices of most construction materials are falling, timber is bucking the trend as the result of a reduced supply of timber from the government and reductions in the maximum loading weights for trucks.

Prices of two common timber species have jumped by about 25 percent from November 2010 levels, said the spokesperson for one sawmill in South Dagon township.

“Two kinds of timber, in and kanyin [Dipterocarpus tuberculatus and Dipterocarpus alatus], are increasing in price. A lot of the timber used in the construction industry is logged in upper Myanmar in Mandalay, Monywa [Sagaing Region] and Shan State. The reduction in truck load limits [since March] has pushed up transport charges and prices for sawn timber as a result,” said a spokesperson for a sawmill in South Dagon township.

“We buy logs for about K480,000 a tonne, mill it and sell the sawn timber for K520,000 a tonne,” he added.

The owner of a mill in North Dagon township said demand for timber is strongest during the dry months, when construction sites are busy, adding that prices normally rose each month as supply dried up.

“From October to May prices usually increase by about K20,000 a month,” he said.

“But the ministry’s restriction in maximum load limits means we have to hire two trucks to carry the same amount of wood. At the same time, our normal costs have not fallen so it’s logical that we increase timber prices.

“I think this trend will continue in coming months,” he added.

But the price rises have not been limited to in and kanyin, said a spokesperson for Family sawmill and timber trading in North Okkalapa township.

“I think that within two months the prices for most species of timber will rise by between K50,000 and K100,000 a tonne.

Another factor that is contributing to higher timber prices is the gradual reduction in the amount of timber sold to private mills by the Myanma Timber Enterprise, said a spokesman for Family sawmill and timber trading in North Okkalapa township.

“In, kanyin and pyingadoo prices have not increased much yet but I expect they will in coming months,” he added.

A sawmill owner based in the South Dagon Industrial Zone confirmed the rises in in and kanyin prices.

“Timber prices hardly changed between late 2010 and early 2011, with log prices averaging about K400,000 a tonne and sawn timber about K420,000-K430,000,” he said.

However, prices have been rising since April, when log prices hit K460,000 a tonne, he said. By June the price had increased to K480,000, where it remained until late October before rising to between K490,000 and K500,000 a tonne.

He added that sawn timber prices were between K10,000 and K20,000 a tonne higher.

By comparison, in and kanyin were selling for about K420,000 a tonne in October 2010, several traders said.

In March, the Ministry of Construction issued an order that stating that six-wheel trucks would be limited to 18 tonnes; 10-wheel trucks would be restricted to 25 tonnes; 12-wheel trucks to a maximum of 30 tonnes; and 14-, 18- and 22-wheelers to a maximum of 34, 46 and 55 tonnes.