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Timber Price Increases Set to Continue into 2021


The global construction sector has seen a substantial increase in the price of raw materials in 2020, and in particular in the price of timber.

Timber frame manufacturers have been hit hard by the price hikes. Fuelled mostly by an explosion in demand for timber in the US housing market, the Covid-19 crisis, and a subsequent massive upsurge in demand in the global DIY market, timber prices have risen steeply since the end of Q1 2020. Licensing issues related to the felling of Irish trees and Brexit stockpiling have added to problems in the market, resulting in a pile-up of supply pressures hitting the market.

Irish construction consumes an estimated 625,000 cubic metres of sawn timber per annum. This figure excludes panel products such as OSB and plywood, which are also increasing in price.

Timber is a commodity, and as such, it is subject to the laws of demand and supply. The market is cyclical, and under normal conditions, timber prices tend to increase or decrease in relatively small increments of about 5%.

It is estimated that the since Q1 of this year, the price of timber has increased by an unprecedented 35%. It is expected that the cost of timber will continue to increase in the new year, but at a less incremental rate before possibly settling again in Q3 of 2021.

Native Timber Issues

The supply of native timber in Ireland has been hampered by delays in the issuing of licences due to a backlog of appeals.

The number of forestry appeals received by the Forestry Appeals Committee (FAC) by the start of November 2020 was 689 appeals. This was almost three times the amount received in 2017 and 2018 combined.

The passing of the Forestry (Miscellaneous Provisions) Bill 2020 by the Dáil in October will facilitate the processing of these appeals. However, this will take time, and when the supply of native timber returns to normal, it will still be subject to market prices.

Speaking about the licencing crisis in Irish forestry, Clodagh O’Reilly, Sales & Supply Chain Director, Coillte, says, “The building blocks are now in place to resolve the recent licencing crisis. However, we have a way to travel before the backlog of licencing or appeals is dealt with. There has been a step-change in the volume of new licencing and appeal hearings. This has allowed the industry to keep moving, albeit not at the level required to operate normally. It is likely to be Q1 before the backlog is cleared.”

Timber Frame Sector

Timber frame manufacturers have been hit hard by the price hikes. Most timber used in the timber frame industry in Ireland is graded softwood imported from producers in Scandinavia and mainland Europe. These producers have started to export large quantities of timber to the US market, which has driven up prices.

John Desmond, Managing Director, Cygnum Timber Frame, and Vice-Chair of the Irish Timber Frame Manufacturers Association (ITFMA) says that the timber frame manufacturing industry has now passed the point where it can continue to carry these price increases.

“The building sector experienced substantial price increases for almost all timber products this year, and suppliers, such as builders providers, have already passed on these increases.

“To remain viable, the timber frame industry has also needed to pass on price increases. Traditionally, timber frame has been very stable compared to other build methods, but unfortunately, the timber market has hit a perfect storm in the past few months.”

Structural timber accounts for about 21% to 25% of the sales price of a timber frame house. Timber frame accounted for approximately 5,400, or 35%, of new house units built in Ireland last year. This is about 24% of the overall 21,241 residential units built during the year.

“It is imperative that timber frame manufacturers engage openly with their clients on the impact of these increases to ensure trust and confidence in the industry are maintained.”


While some supply issues will be addressed in the coming months, and there would appear to be a recent softening in US demand, growing demand from China for European timber means that purchasers will continue to pay a premium for timber for the foreseeable future.