The fall-out from the Brexit vote on 23 June, combined with challenging economic conditions in other parts of the Europe, particularly Italy, is likely to lead to a downturn in European timber imports in the second half of 2016.
Feedback from UK timber importers in the aftermath of the Brexit referendum vote on 23 June is that their most immediate concern is the exchange rate.
The value of the British pound, which increased from 1.41 to 1.50 against the US dollar in the days leading up to the referendum on the expectation that “Remain” would win, fell sharply to a 30-year low of $1.29 on 6 July after the result. By 22 July it had recovered only slightly to $1.31.
The euro, already low against the US dollar after a dramatic fall in late 2014 and early 2015, also weakened following the referendum from $1.14 on 22 June to euro1.10 on 22 July (see chart).