The key UK housing market will see increased demand in 2026, over 200 timber industry delegates heard at Timber Development UK’s (TDUK) Global Market Conference in London.
The event on November 5 saw a succession of speakers from the sawmilling, merchanting and timber frame industries share their views. Key points include expected decreased timber production in the Nordic countries, current difficult levels of profitability and the inability of the UK Government to hit its ambitious housing targets.
David Hopkins, TDUK CEO, updated on key initiatives like the Timber in Construction Roadmap, EUDR introduction, and some concerning areas of product cost-cutting (and rule circumventing) in areas such as birch plywood and tile battens.
But against a backdrop of a difficult market, Mr Hopkins said interest in using wood was growing.
“We’re seeing more and more interest in timber,” said Mr Hopkins. “This is likely to filter down toward the end of Q1 and Q2 2026 into greater demand for wood products.”
Keynote speaker Markus Henningsson, VP sales and marketing of SCA Wood, covered the European and global outlook for wood products and sawmilling capacity.
He said that the long-term demand for wood would be greater than the supply available.
Stock levels in Finland and Sweden in Q3 were up 15% for pine and up 11% for spruce compared to the same period in 2024.
“Profitability is so difficult, I think we will start to see reductions in production. And I believe this will correct the situation.”
He highlighted the North America market as having great potential for increased wood demand.
“The US has a strong long-term outlook because of pent-up demand for housing in the US for the last 15 years,” said Mr Henningsson. “There’s just a few years where they have reached 1 million houses built per year.”
Canada, traditionally a big supplier to the US saw a 5% decrease in production in January to June 2025, with Mr Henningsson expecting the figure to continue to decrease. New US anti-dumping/countervailing duties on Canadian softwood lumber imports were imposed in August, equating to a 14-34% increase.
A panel discussion involving Neil Horton of BSW Timber, Kalle Parviainen, SVP of Metsa Fibre and Mr Markus Henningsson debated key issues at the conference.
Mr Horton said UK merchants and distributors were currently under margin pressure. He said Storm Eowyn at the start of 2025 helped boost demand for fencing.
He said BSW Timber would try and grow its market share and expressed optimism, citing the new collaboration between three major sawmillers (BSW, James Jones and Glennon Brothers) to boost homegrown C16 timber. But the UK Budget uncertainty was not helping, he said.
Mr Parviainen said it was difficult to see an increase in the softwood market in 2026.
Key figures from the Construction Products Association (CPA) unveiled by CPA economics director Noble Francis show the CPA is forecasting slow economic growth over the coming years – a 1.3% GDP growth in 2025, +1.5% in 2026 and +1.6% in 2027.
On private housebuilding, most major housebuilders say they will achieve single-digit growth in completions during 2025, but demand had slowed sharply in March.
The CPA forecasts +2% growth in private housing in 2025 and -4% in public housing, with no change in private RM&I. Mr Francis pointed out that housing starts in London are down by 50%.
In 2026 it predicts +4% growth in private and public housing, with +2% growth in private RM&I.
Mr Francis described the Government housing target of 1.5 million new homes over five years as “nonsensical.
“It’s not going to happen, it was never going to happen,” he said. He said an “optimistic” estimate was that the Government would miss its target by about 30%.
Mr Francis emphasised the 2026 housing growth was from a very low base and skewed to major housebuilders, with difficulties likely for smaller housebuilders. He said the CPA was expecting to see an increase in the number of subcontractors and small merchant insolvencies in 2026, with cashflow under pressure. The lag effect of the long period of subdued demand would have an impact, he added.
Cost rises and skills availability were key risks for the construction sector, he said.
