Market ReportAfrica - Middle East - South Asia - Oceania

May/June 2017

www.americanhardwood.org

Above: Part of the Bilgola Limited Edition by Adam Goodrumfor Cult in American tulipwood, as shown by AHEC at Denfairin Melbourne this June. (See inside for details.)

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Seminars Aim to Address Indian Wooden Furniture &Handicrafts Sector Material Crisis & New Opportunitiesfor American Hardwoods

AHEC, with the support of the NHLA and incooperation with two of Rajasthan's keyindustry associations, organised twoseminars and lumber grading workshopsin India in early May. The events inJodhpur on 6 May and in Jaipur on 8 Maywere triggered by recent developments,which have led to severe shortages inhardwood lumber supplies to India'swooden furniture and handicraftsmanufacturing sector. Traditionally-sourced hardwoods - sheesham, mangoand acacia - are becoming much harder tosource and prices are rising significantly.Furthermore, sheesham (Dalbergiasissoo), has now been brought underCITES trade controls, rendering it veryhard to source and forcing the industry'slarge retail customers in the US, EU andAustralia to stop buying furniture madefrom it.

AHEC's seminars in the two keymanufacturing centres of Jodhpur andJaipur in Rajasthan were aimed attackling this issue by presenting the

industry with American hardwoodalternatives. The information waswelcomed by around 150 members of boththe Jodhpur Handicrafts ExportersAssociation (JHEA) and the Federation ofRajasthan Handicrafts Exporters(FORHEX), who were in attendance. One ofthe main focuses of the seminars was onchoosing the right grade of US hardwoodlumber for the types of products beingmade. It was generally accepted that a mixof No. 2A and 2B Common would offer themanufacturers a product roughly in linewith what they are used to getting locally. Interms of species, a lot of interest wasexpressed in tulipwood, with its versatilityin applications and its excellent machiningproperties, as well as its relatively low cost.

AHEC believes that this is a genuineopportunity for American hardwoods tofind their way in to the Indian market insignificant and consistent volumes. Insupport of this, efforts are currently beingmade to provide the manufacturers inJodhpur with a container of donated

tulipwood and a few other species as ameans of enabling production trials. It willbe important for the manufacturers to beable to convince their overseas buyers,particularly in the United States, EuropeanUnion and Australia, to accept the newspecies being used. However, already infavour of US hardwoods is the fact thatthey present no issue as far as timberimport regulations (Lacey Act, EUTR andAUSILPAR) are concerned.

In a positive development, which serves tounderpin AHEC's belief in this newopportunity and as a direct result ofAHEC's visit in May, one of the largestmanufacturers in the state of Rajasthan isalready in the process of ordering acontainer of tulipwood lumber in order tostart trials as soon as possible.

A more detailed report on the woodenfurniture and handicrafts sector and thisopportunity can be found in theaccompanying Special Report: India -New Opportunities for AmericanHardwoods.

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A trip made to Istanbul in mid-May wasthe first for AHEC since February 2016,when AHEC participated in the YAF (Woodin Construction) trade fair. Since that time,Turkey has faced significant and well-documented issues with security, whichhave kept many foreign business peopleand tourists away. Foreign investment into the country has also slowed and theresult is much slower economic growththan in recent years.

In terms of American hardwoods, demanddecreased in 2016 and also, so far, in 2017,but most of this has been the result of anumber of companies switching fromAmerican to European (notably Ukrainian)ash for thermal modification. Exports ofAmerican ash to Turkey dropped by 43 percent in 2016 to a volume of 3,464 cubic

Turkey Visit Underlines Instability, But Market PotentialRemains

metres.

For the “normal” trade in US hardwoods (forgeneral distribution to furniture and joinerymanufacturers), demand has never beenhigh in Turkey and this is owed to thegenerally low consumption of solidhardwoods in the market, as well as to alack of knowledge of US hardwoods. WhileTurkey boasts a very large furniture sector,it is largely panel-based and theconsumption of solid timber is very low.

AHEC still maintains, however, that Turkeydoes offer significant long term potential asa sizeable market for American hardwoods.It cannot be ignored that Turkey has apopulation of around 80 million and thatlabour costs are relatively low for a countrypositioned in a strategic location next to

Europe and with access to both CentralAsian and Middle Eastern markets.However, economic stability andimproved security will be key in the nextfew years if the market is to get back to therate of economic growth witnessed upuntil two years ago.

With this in mind, AHEC plans to increaseits activities in Turkey, once again,starting with a reprise of its series of in-house design and architecturalpresentations later this year. Thepossibility of taking AHEC’s ‘Seed to Seat’furniture design project to Turkey in 2018is also being considered.

AHEC PresentsFurnitureCollection inTuilpwood &Cherry at Denfairin Melbourne

Working, once again, with Australia's "ItBoy of Design", Adam Goodrum and inpartnership with leading designerfurniture retailer, Cult, AHEC presented aLimited Edition range of Adam's latestcollection in American tulipwood andAmerican cherry at Denfair (Melbourne8-10 June).

The 'bilgola' collection, inspired by themodernist architecture of Sydney'sNorthern Beaches, was originally made inAmerican ash and was launched by Cult atboth Milan Design Week and ICFF in NewYork earlier this year. Working withSydney-based manufacturer, Evostyle, aLimited Edition range of the collection wasproduced in tulipwood and cherry, alongwith matching solid hardwood screensand displayed at Denfair for the first time.During manufacturing, data on energyconsumption and waste was collectedand, coupled with AHEC's existing LCA

data on American hardwood lumber, a fullenvironmental profile for the finishedpieces was produced.

This was seen as a significant opportunityto demonstrate the beauty, versatility andenvironmental credentials of two speciesof American hardwood, which are not wellknown in Australia, to an audience ofaround 8,000 design industry professionalsat a high profile event. The partnership withAdam Goodrum also served to draw addedattention to AHEC's stand at the show andthe collaboration with both Adam and Cultwill continue for the coming months, as the

'bilgola' range is shown in Cult'sshowrooms across Australia and NewZealand. This collaboration has alreadybeen widely featured in the Australiandesign media, as well as in leading dailynewspaper, The Australian FinancialReview.

From a market where American white oakdominates furniture production, alongwith American ash and some walnut, thereception to both the American tulipwoodand cherry was very good. It is hoped thatthis project will lead to further interest inthese species.

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New Indian Wood ShowCancelledAHEC had signed up to a new show -Interwood Expo - which was to be held inMumbai from 2 to 5 November. However,this event has now been cancelled andAHEC intends to focus on the March 2018edition of Indiawood in Bangalore instead.More information on this show will bereleased in the coming months. Pleasevisit www.indiawood.com for moreinformation.

Refocus on Egypt with ThreeNew Wood Industry EventsAHEC has now committed to participatingin two new wood shows in Egypt thisDecember. The first will be a reprise of thepreviously-launched Cairo Woodshow,which will take place from 4 to 7December. AHEC will have a smallinformation booth at the show, which isbeing given free of charge by theorganisers.

The second show - Egy Wood Expo - willrun from 7 to 10 December and will also beheld in Cairo at a different venue. This is acompletely new show, being organised bya Turkish trade exhibition company. AHECwill also have a small information booth atthis event.

Without taking part in both of these events,it would be impossible to know which mightevolve in to the better of the two. What isclear, however, is that the Egyptian marketfor hardwoods is growing once again andthere is good demand for both Americanhardwood lumber and veneers. With this inmind, AHEC feels that it is important to beactively involved in this market.

There is also scope for some technical andlumber grading seminars to be held laterthis year and more information on this willbe made available in the coming months.

A third wood trade event in Cairo will be heldin February 2018 and this is the evolution ofWoodtech Forum, held in November 2016 inDamietta in to Woodtech Egypt. The eventwill be held from 16 to 18 February andAHEC will provide more information on thisas it becomes available. Further informatiocan be found at:

www.cairowoodshow.com

www.egywoodex.com

www.woodtechegypt.com

AHEC is yet to confirm participation in thisevent. More information on this show willbe provided in due course, but somedetails can be found at:www.wtdexposaudi.com.

Future Trade Shows

New Saudi Wood Show Now inMarch 2018DMG Events, the organisers of the long-established INDEX and Big 5 series ofshows across the MENA region, haverecently launched a new wood industryevent for early next year. Wood Tech &Design Expo will now take place in Jeddah,Saudi Arabia from 5 to 8 March 2018alongside the Big 5 Saudi constructionshow.

The event is being positioned as aconference and trade show, featuring a fullprogramme of educational seminars forboth specifiers (architects and designers)and wood industry professionals.

Dubai Woodshow 2018 DatesNow SetThe dates for next year's edition of theDubai Woodshow have now been set for12 to 14 March 2018. AHEC will plan, asalways, to be there with an AmericanHardwood Pavilion.

It should be noted, however, that the Dubaishow will overlap by one day withIndiawood in Bangalore, which is to beheld from 8 to 12 March. Althoughunconfirmed as yet, AHEC is alsoconsidering organising an AmericanHardwood Pavilion at this event, which ithas not done since 2012. This may be agood thing, as it would allow for somecompanies to take part in both shows, bymissing the last day of Indiawood. Formore information on the Dubai WoodShow, please visit:

www.dubaiwoodshow.com

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PR Highlights

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27 May 20170.890.3718.073.570.710.301,483.269.700.38103.853.643.753.573.6712.9079.4264.45151.151.341.42

27 Jun 20170.890.3718.113.530.710.301,480.379.500.38103.603.713.753.503.6712.8879.4164.39150.651.321.37

Exchange Rates Regional Events *Bold denotes AHEC event or AHECparticipation

AHEC Africa - Middle East - South Asia - Oceaniarod@americanhardwood.org

Oceania | FurnishingInternational | 26 June 2017

Online feature on AHEC'sfurniture collaboration withAdam Goodrum

MENA | Big 5 Hub | June2017

2 page feature onthermally-modifiedAmerican hardwoods

India | Wood News | May-June 2017

8 page feature on Americanhardwoods & AHEC'sactivities

Oceania | AustralianFinancial Review | 9-11June 2017

Story on the AHEC/AdamGoodrum collaboration

9-13 Aug 100% Design SA Johannesburg, South Africa

4-7 Dec Cairo Woodshow Cairo, Egypt

13-18 Nov Dubai Design Week Dubai, United Arab Emirates

7-10 Dec Egy Wood Expo Cairo, Egypt

16-18 Feb Woodtech Egypt Cairo, Egypt

5-8 Mar Wood Tech & Design Expo(as part of Big 5 Saudi)

Jeddah, Saudi Arabia

8-12 Mar Indiawood Bangalore, India

2018

12-14 Mar Dubai Woodshow Dubai, United Arab Emirates

21-23 Nov Timber 2017 Tel Aviv, Israel

Source: OANDA FX Converter*denotes currency pegged to USD