International timber market in 1988 and expectations for 1989

The growth of the gross national product in the countries of West Europe and North America was higher than it had been expected. According to estimation, the growth of the gross national product in 1988 in West Europe shall be in proportion 3 percent to 2.4 percent and in North America 3 percent to 3.4 percent in 1987. Many forecasts expect a lower growth in 1989 : 2.5 percent in West Europe and 2.8 percent in North America. It would be a sufficient growth for economy to get satisfactory progress also in 1989. The inflation rate in 1988 recorded a slight increase - in West Europe 3 ¼ percent and in North America 4 percent. The fact that the long-term growth of interest rates has been lower than the short-term growth provides evidence that the growth of the inflation rate shall stabilize at a low -level. In the countries with centralized planning, according to the plan, the growth of national income shall from 2 ½ percent in 1987 grow to 5 ½ percent in 1988. The similar rate -of growth is expected also in 1989. Both, in West Europe and North America production and demand for pulp and paper show a strong upward tendency. Capacities have been record-high utilized and the prices have been kept rising. Consumption of sawn timber and wood-based panels depended on development of sector mostly using these. The long-term growth of consumption of sawn timber and plywood has been discontinued because of decline in housing construction in some countries. Consumption of deciduous timber, chipboard and in less degree particle boards continued to grow in European as well as in North America. It is expected that in 1989 there will be a general decline of consumption of some wood products in Europe and in North America. Thus, in first place relates to softwood and plywood. Consumption of deciduous timber shall remain on a satisfactory level and chipboard and fibre board in Europe shall increase. Because of expected further increase of production of pulp and paper, consumption of pulpwood shall be on the increase.