European importers report that Chinese plywood has been readily available during 2015 and that delivery times to Europe currently stand at around 4 to 5 weeks. The dominant issue for traders in the Eurozone is the rising cost of imports, especially since December 2014, due to the dramatic loss in value of the euro against the US dollar.
Against this background, Chinese producers lowered their prices by an average of US$5-10/cu.m earlier this year. FOB prices have now stabilised at this new level.
However, CIF prices for delivery of Chinese plywood to Europe have continued to fall due to an unexpected slump in freight rates in March/April after a slowdown in China‟s overall trade. According to information from importers, freight costs per 40ft container from China to Central Europe temporarily fell to less than US$500, before stabilising at around US$700 in July.
By contrast, rates in July 2014 stood at more than US$1200 per 40ft container. Shipping companies are currently pushing to increase prices to more than US$1000 per container for shipments in August.
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Roundwood prices go down in Finalnd in June
Roundwood prices in Finland have declined in June as compared to May, with only one exception. Pine sawlogs' price is lower by EUR -1.51/cbm, while spruce sawlogs are cheaper by EUR -1.79/cbm. On contrast, birch sawlogs have continued the recent upward price trend and have become more expensive by EUR +1.50/cbm. Pulpwood assortments prices have also trended downwards and are cheaper on average by -1.50%.
On a yearly basis, Finnish roundwood prices show the same decreasing tendency. Only birch sawlogs are more expensive by +5.59%. Spruce and pine sawlogs are both cheaper compared to May 2015, and pulpwood assortments have lost in price terms between -2.09% down to -3.87% for pine.
Roadside prices of roundwood in Finland EUR/m³ over bark |
June 2014 | May 2015 | June 2015 | Change June/2014 to June/2015 |
Change May/2015 to June/2015 |
| LOGS | |||||
| Pine | 56.57 | 56.88 | 55.37 | -1.41% | -2.65% |
| Spruce | 56.68 | 56.80 | 55.01 | -2.94% | -3.15% |
| Birch | 45.38 | 46.42 | 47.92 | +5.59% | +3.23% |
| PULPWOOD | |||||
| Pine | 28.68 | 27.72 | 27.57 | -3.87% | -0.54% |
| Spruce | 29.50 | 29.46 | 28.52 | -3.32% | -3,19% |
| Birch | 29.53 | 29.09 | 28.91 | -2.09% | -0.61% |
Price source: Metla.fi
Kährs group states higher sales for the second quarter
The Swedish flooring manufacturer Kährs has finished the second quarter of 2015 with an increase in net sales of 4%, up to 681 million SEK. The group's EBITDA in Q2 amounted to 76 million SEK an improvement of 17%. The profit for the period amounted to 24 million SEK in the second quarter.
The CEO of Kährs, Christer Persson, attributes the favourable results to the higher net sales in the Hardwood flooring segment but also to the Other segment for the period. Most of Kährs' sales regions contributed to the improvement with strong underlying sales development in Sweden, Germany, Switzerland, UK and the US, said Mr. Persson.
During the summer, Kährs Group has agreed on a new financing to create a more efficient capital structure. This new financing means that Kährs Group transfer to a traditional bank financing and that Kährs had an early redemption of the bonds listed on Nasdaq OMX Stockholm. The transaction was completed on August 3 by the repayment of the issued bonds.
Europe continues to recover in laminate flooring sales
According to final figures published by the European Producers of Laminate Flooring (EPLF) association, laminate flooring sales by EPLF members increased slightly by around 1% to 467 million sq.m last year. Final sales were thus slightly higher than initial figures published earlier this year, which put total sales in 2014 at 465 million sq.m.
Market conditions for laminate flooring manufactured in Europe have varied widely by sales region. The chart illustrates the importance of the different sales markets for EPLF members.
Sales in Germany, the largest single market, fell 4% to 69 million sq.m in 2014. EPLF believes that much of this decline is due to a shift towards LVT flooring in Germany.
Sales to Turkey - the second largest target market for EPLF members - fell by 13% to 57 million sq.m in 2014. EPLF attributes this development to a weaker economic situation, shortages in the supply of raw materials and the temporary shutdown of production plants in Turkey.
EPLF member sales of laminate flooring in the important French market stabilised at 39 million sq.m in 2014, the same amount as the year before. However sales in the UK increased by 10% to 32 million sq.m in 2014, boosted by growth in construction sector activity and improving consumer confidence. There was also a 4% increase in sales in Spain to 14 million sq.m.
In Eastern Europe, EPFL members saw a much better trend than in the west. Combined sales in this region rose by 6.8% to 110 million sq.m. Growth in Eastern Europe was primarily owing to strong development in Russia, where sales increased by 19% to 28 million sq.m and Poland, which showed an improvement of 6% at 26 million sq.m. Sales volumes in Romania and Hungary were also higher than the year before.
In North America, the positive trend that started in 2013 continued into 2014. Most of this growth was attributable to the USA, where sales rose from 16 to 18 million sq.m. Sales in Canada were practically unchanged in 2014 at 11.2 million sq.m.
In Asia, EPLF members booked a strong 15.4% increase in sales to 15 million sq.m. EPLF member sales to China increased by around 25% in 2014, but at 5 million sq.m are still very small compared to the overall size of the market.
Prices for wood pellets in Switzerland remain stable in August
The retail prices for wood pellets in Switzerland remained stable in August. The average price of pellet currently stands at 373.70 CHF/t (351.55 EUR), and thus only 0.1% below the previous month. Compared with August 2014, the average price fell by 6%. In euro terms it is higher by 7.5%.
Depending on the order quantity the price varies between 362.71 CHF/t (341.21 EUR) and 386.02 CHF/t (363.14 EUR).
Germany reaches high level of wood pellet production
Approximately 980,000 tons of wood pellets were produced in Germany in the first half of 2015, as the German Energy Wood and Pellet Association (DEPV) reported. Thus, production in the country is at a high level. However, with this output, production was slightly below the previous year's figure, with only 19,000 fewer tons produced.
Unsatisfactory second quarter
With only 493,000 tons, the second quarter of 2015 has recorded the lowest production volume since 2011. The drop is of nearly 60,000 tons as compared to the second quarter of 2014. ''The mood among consumers is currently reluctant. Therefore, the consumption of pellets has slightly lagged behind expectations,'' said Martin Bentele, Managing Director of DEPV.
Weather and oil prices are factors for a hitherto unsatisfactory market trend in 2015. Storage activities of consumers, which are usually completed in July, shifted this year towards late summer. With this spring's significantly improving funding conditions of the market incentive programme, it is expected that this fall demand for pellet heating systems to climb.
98% of the pellets produced in Germany are ENplus certified
Bulk purchasing is still the most used form of pellet trade in Germany (86% share). Pellets in sacks were sold in a proportion of 14%, down from 19%. Also because of the unsatisfactory domestic consumption, the export share was 19% in the first half. 81% of the pellets produced in Germany were sold in the country.
More than 98% of the German wood pellets produced are ENplus A1 quality. Almost the entire German production is certified according to ENplus, with more than 100 ENplus licensees dealers.
The DEPV estimates that the number of independent pellet producers in Germany is of approx. 60 with 47 production facilities nationwide.
Japan rises its log exports to 50%
Total volume of Japanese log export during January and May this year reached to 259,515 cbms, 47.5% more than the same period of last year. If this pace continues, total export for the year would be about 700-800 M cbms. However, log export for April and May from Kyushu, which took 80% share last year, slowed down.
There are active inquiries from China with price advantage by weak yen but ships‘ space is short so that logs are piled up at loading ports. Japan's shipments for Korea has been slowing down by economic slump in Korea and there is surplus of supply as log length for Korea is 2.4 meters, which is not common length in Japan.
According to Kagoshima customs house, which covers shipping ports like Shibushi and Sendai in Kagoshima, log export in last January doubled, 34.2% more in February, 71.9% more in March, 36.2% down in April and 14% more in May.
Total value of log export in the first five months were 1,068. 56 million yen (estimated volume of about 90,000 cbms), 23.7% more than the same period of last year but it slowed down in April and May. Another port of Yatsushiro, Kumamoto prefecture in Kyushu doubled the volume for the first five months of this year.
In Kyushu, domestic log demand for lumber and plywood since start of the year has been sluggish and cedar logs with sweep are rushed for export and the prices are soft but with steady inquiries from overseas buyers, cedar log prices for export maintain 8,000 yen per cbm delivered port yard.
Many redwood products stores to close in Beijing
According to a representative from one of the main redwood‘ markets in Beijing some 12 stores selling redwood‘ products have closed and only 2 remained open as of the end of July.
It has been reported that demand for redwood‘ products has cooled considerably and sales by the well-known, large redwood enterprises are slow and well down from a few years ago. The smaller manufacturers of redwood‘ have been particularly affected by the market downturn.
While there is some demand for high-end redwood‘ furniture analysts estimate that 50% of the furniture sold today is of wood-based panels and that these products dominate the market.
The future for redwood‘ furniture makers in Beijing does not look bright and analysts expect further closures as demand wanes.
Oil prices expected to rise sharply in the upcoming years
The price of oil will rise again to 100 dollars per barrel in the next five years, according to Gary Ross, founder of the PIRA Energy group. The pessimistic estimates about oil prices fail to recognize that in the future oil producers outside the US will have problems and their investments will have to go back, Ross argued in a study. Thus it is a matter of time until the supply of oil will scarce.
“Current prices are unsustainable,” Gary Ross said in an interview. “It’s hard not to see oil hitting $100 a barrel at some point in the next five years.”.
Oil prices have been struggling to move significantly above $50.00 as concerns over a global oil glut continue to build up. Declining oil prices are triggered by a stronger U.S. dollar, a slowdown in the Chinese economy, and additional oil supply from Iran after the landmark deal.
Many analysts express their concern that the Chinese economy is slowing down faster than many had expected. China is the second-largest oil consumer in the world. The slowdown in the Chinese economy would have a significant amount of impact on oil prices.
Although China’s demand for oil is expected to slow down, Ross thinks that an increase in demand in industrialized countries would compensate for weak Chinese demand.
“Consumption will be strong in industrialized economies such as the U.S., Europe, and Japan, where fuel demand has swung to expansion from contraction,” according to Ross.
In addition, Ross foresees a rise in oil consumption in the world's economy: in 2015 and 2016 he expects an increase in oil demand of 1.7 million barrels per day - which is higher than the estimates of most analysts, which areestimating an average increase of one million barrels per day.
Gary Ross also expects a decline in oil production in countries outside OPEC (Australia, Colombia and Argentina). There would also be geopolitical risks, especially in the Middle East, which sooner or later will drive the prices up, said Ross.
FedEx wants to increase use of wood biofuels
Global logistics giant FedEx Express has reinforced its commitment to increase use of renewable biofuel by signing a supply deal with US-based Red Rock LLC, which is currently building a biorefinery to manufacture this product from woody-biomass. This is the second contract for Red Rock after the one signed with US Southwest Airlines.
Red Rock will provide FedEx with three million gallons of low-carbon jet fuel per year starting 2017 until 2024.
Red Rock’s first refinery, funded in part by a $70 million Title III DPA grant from the U.S. Departments of Agriculture, Energy and Navy, is scheduled to break ground this fall in Lakeview, Oregon and will convert approximately 140,000 dry tons of woody biomass into 15 million gallons per year of renewable jet, diesel and naphtha fuels.
“As we look to break ground on our refinery in the coming months, we’re thrilled to have signed a contract with FedEx as they look to diversify their fuel supply and reduce emissions throughout their aviation unit,” said Terry Kulesa, co-founder and CEO of Red Rock. “With our total jet fuel capacity now sold to FedEx and Southwest Airlines, we are building a suite of powerful, global customers that continue to commit to the future of alternative fuels in a market where oil prices are low, providing true validation of our business model and mission.”
Red Rock Biofuels LLC will refine waste biomass residues into high value, lower carbon renewable jet, diesel and naphtha fuels.
“USB” made of soft hardwoods?
Wood-based panels giant Egger and University of Göttingen jointly developed so-called unoriented-strand boards (USB) made of soft hardwoods such as silver birch, alder, poplar and willow. The project, which was funded by the German ministry of food and agriculture (BMEL), is to help making better material use of the fairly large, untapped German resources of soft hardwoods.
According to a press release issued by Fachagentur für Nachwachsende Rohstoffe (FNR), a government agency charged with the implementation of the project, the results were very positive. The mechanical and technical properties of soft hardwood USB would range somewhere between regular OSB and particleboard.
As a part of the project, the partners produced both pure soft-hardwood USB and USB made of a mix of soft hardwoods and pine as well as pure pine USB. Both USB types containing hardwoods performed at least as well or even better than the pure pine USB, according to FNR. Volatile organic compound (VOC) emissions, in particular, were lower in soft-hardwood USB and in mixed products.
In USB, wooden particles and strands are not “oriented”, like in normal OSB, but scattered randomly. The board can be produced on normal particleboard production lines.
Soft hardwoods account for roughly 10% of German forestlands and they are being made little material use of so far, according to FNR. However, the supply of soft hardwoods is not large enough to allow for a full replacement of softwoods in OSB – or USB – production, which is why a mix of both types of wood was tested as well.
Among the soft hardwoods tested, alder showed the best performance-mix with the lowest VOC and formaldehyde emissions. The bending strength of alder USB is comparable to that of pine OSB/3 and the swelling rate was lower than in pine boards. Willow performed second best on average, with an even higher bending strength than alder. Birch and poplar USB also performed similarly or better than pine USB in most parameters.
The researchers are recommending using the initial results for developing extremely low-emission wood-based materials with especially good strength properties.
Forecast: North American composite panel market to see strong growth by 2022
After a dismal decade, North American composite panel producers can finally breathe a sigh of relief: the worst is over and the future is looking positive, according to the international consulting and engineering company Pöyry. The composite panel market peaked in 2005, followed by a steep decline and bottomed out in 2009. Since then the market has been growing, stimulated by the economic recovery and the revival of the furniture and construction markets which are the growth engines for composite panels.
Although Pöyry expects 4% year-on-year growth until 2022, the 2005 peak will not be reached yet. To explore what might happen going forward, Pöyry has adopted its proprietary methodology, which in a unique way (incorporating advanced linear programming techniques) combines capacity, market and pricing forecasting to generate three scenarios: central, dynamic and stagnant. Only under the dynamic scenario, is the 2022 market likely to show a full recovery. Unsurprisingly, the young Mexican market is going to be the fastest growing in the region, albeit from a low base.
‘As the tide has changed, the North American composite panel industry is gaining the confidence to grow' says Dr Cormac O'Carroll, Head of Forestry, Biomass and Wood Industry Practice at Pöyry Management Consulting. ‘The market leaders such as Arauco, Uniboard, Masisa and others have already green lighted their investments, which will bring combined more than 400 million square feet of new capacity to the market over the next two years. This represents less than one fifth of what is going to be needed by 2022, if Pöyry's central forecast is realised'. The Pöyry model analyses not only the capacity gap, but also the impact of new capacity addition on market prices, as well as providing insights for where new capacity should be located (subject to full feasibility).
However, a decade-long decline has had a negative impact on the industry with many mill closures and market exits. The industry is therefore facing a number of challenges, competitiveness being the major one. Despite recent consolidation moves, the value chain remains fairly fragmented with an aging asset base which remains exposed to imports from Asia, Latin America and Europe.
The predicted growth curve should therefore encourage the industry to invest not only in new capacities but also in new technologies and business models. ‘By comparison with its European counterpart, the North American composite panel industry is some years behind in terms of innovation. European trends, such as lightweighting or digital printing, have not yet made significant inroads in North America, but there are some promising signs', notes Cormac O'Carroll.
The North American composite panel sector has a major advantage compared to other industry peers: a competitive lumber supply. When combined with the right operating model this can be a unique platform for building a profitable, sustainable and potentially more globally relevant composite panel value chain.
Call for ban on log exports in Malaysia
The Sabah Timber Industries Association (STIA) has urged the Sabah State Government to consider a total ban on the export of logs from natural forests to ensure all timber resources are fully-utilised by the local industry.
STIA President, James Hwong, was reported by the local newspaper Daily Express, as having said there was enough local processing capacity to fully utilise the export grade logs and the industry was able to pay the international market price for such logs.
However, Sabah Forestry Director, Sam Mannan, has said a total log export ban was unnecessary citing statistics that show between 2010 and 2014 from 86% to 91% of Sabah's natural forest log production was consumed by domestic mills.
The Daily Express quoted Mannan as saying "log sales to domestic mills are highly subsidised in the form of preferential royalty rates". For example, he said, royalty on red seraya (Class C) for export is RM160 per cubic metre whereas if the log is milled locally the royalty is just RM90 per cubic metre.
| Total production cu.m. | Total export cu.m. | Local processing cu.m. | |
| 2010 | 3,483,928 | 408,049 (12%) | 3,075,834 (88%) |
| 2011 | 2,212,466 | 308,971 (14%) | 1,903,495 (86%) |
| 2012 | 1,965,671 | 171,000 (9%) | 1,794,671 (91%) |
| 2013 | 2,101,143 | 212,051 (10%) | 1,889,092 (90%) |
| 2014 | 2,060,511 | 237,297 (12%) | 1,823,214 (88%) |
Source: Sabah Forestry Dept
Some changes to the EUTR Guidance Document
According to EU importers, one factor which continues to create uncertainty in the European market for tropical wood is lack of clarity on the steps required to mitigate risk of illegality in line with the EU Timber Regulation (EUTR).
Some market players seem unsure whether any documentation from countries with a low score on the Transparency International Corruption Perceptions Index can be accepted as evidence of negligible risk under the EUTR.
This is particularly the case in Germany where, in 2013, the German EUTR Competent Authority seized a shipment of wenge roundwood after concerns were raised over the authenticity of legal documents issued by the government of the Democratic Republic of the Congo.
In an effort to clarify the situation, the European Commission recently updated the EUTR Guidance Document – although it has yet to publicise this on their website.
The new guidance emphasises that operators placing timber on the EU market must do more than merely collect legal documents. They also have an obligation to explain why and how each document serves to mitigate risk of illegality.
The key change is to Chapter 4 of the Guidance Document (Clarification of the requirement for documents indicating compliance of timber with applicable legislation) which states: “It is important to remember that information included in the collected documents must be verifiable. If the information cannot be verified, the value of the document becomes questionable and the use of the document for risk evaluation and risk mitigation is most likely insufficient”.
The new Guidance goes on: “In addition it is also necessary to take into account the risk of corruption, where possible, specifically in relation to the forestry sector. In cases where the risk of corruption is not negligible even official documents issued from authorities cannot be valued as reliable in themselves.
The higher the risk of corruption in a specific case is, the more it is necessary to get additional evidence to mitigate the risk of illegal timber entering the EU market.
Examples of such additional evidence may include third party verified schemes, independent/self-conducted audits or timber tracking technologies (e.g. with genetic markers or stable isotopes)”.
Wood-based panel production in China up 7 percent
According to statistics from the State Forestry Administration the total output of China’s wood-based panel industries in 2014 was 273.72 million cubic metres, a year on year increase of 7%.
Of the total plywood output was 149.7 million cubic metres, up 9% over 2013 and accounting for 55% of all wood based panel output.
The output of fibreboard was reported at 64.63 million cubic metres, similar to the level in 2013 (24% of total output). The output of MDF was 56.83 million cubic metres. The output of particleboard (8% of total output) was 20.86 million cubic metres, up 11% over 2013. Of the output of other wood-based panels blockboard accounted for 62%.
The provinces with wood based panel output of more than 10 million cubic metres in 2014 were Shandong, Jiangsu, Guangxi, Anhui, He’nan, Hebei and Guangdong. The output of these 7 provinces came to 210.73 million cubic metres, around 75% total output.
IKEA plans to buy 33.600 ha of forests in Romania
Swedish furniture giant IKEA group announced the purchase of 33.600 hectares of forests central and north-eastern Romania. The value of the investment was not disclosed, however the market value of one hectare of forests in those regions indicate that IKEA might have spent around EUR 100 million. One hectare of forests in Romania worths around EUR 3,000-4000. As reported by Romanian news agency Mediafax, it seems the name of the seller is Greengold European Capital AB, headquartered in Stockholm.
Romania is the first country where IKEA buys its own forest. The group says that this investement would facilitate the access to raw materials.
“The investment in woodland is a way for us to diversify our assets. We are happy to expand our forestry activities to Romania, a country that’s important for our furniture production,” said Frederik de Jong, Chairman of the Board, IRI Investments SRL, IKEA’s subsidiary that manages this investment.
IKEA works in Romania with over 20 suppliers, which produce sofas, armchairs, tables, chairs and others. “More than 14,000 people work for our suppliers in Romania, and the value of the products IKEA group purchases from Romania is over EUR 400 million per year,” said Violeta Nenita, Purchasing Operations Manager South East Europe IKEA Purchasing, quoted by Romanian media.
IKEA’s retail division operates a store in Romania, located in northern Bucharest, which opened in 2007. The group recently purchased a land plot in eastern Bucharest for a second store.
IKEA Romania had a turnover of EUR 88 million and a net profit of EUR 2.5 million last year, according to official data from the Finance Ministry. The company has 470 employees.
Softwood producers to target Indian market
The fast-growing Indian market has caught the attention of softwood producers in North America and Europe. Tropical hardwoods are generally preferred in India, but with tropical supplies tight, especially of teak logs, Indian manufacturers increasingly use temperate hardwoods and even softwoods.
More than half of the wood consumption is in doors, windows, furniture and millwork, where manufacturers have started to substitute hardwoods with softwood species. New Zealand has exported pine logs to India for many years now, but a more recent trend is the import of higher-value sawn softwood.
The US exports southern yellow pine to India, while Germany ships pine and spruce sawnwood. Canada aims to grow its sales of Douglas-fir, western red cedar and hemlock to compete with tropical species in appearance applications.
Austrian softwood lumber prices in July
Softwood lumber prices in Austria have overall dropped slightly in July. Compared with June, only the upper price limits of edged boards and boards with 28mm+ thickness have moved upwards. All other prices have remained stable or decreased by one euro.
Compared to the previous month of last year, the prices of squared timber I / II and 28mm+ boards have increased. All other lumber assortments are being traded cheaper by between EUR 1-3.
| Softwood Lumber Spruce/Fir | Jul. 2014 | Jun. 2015 | Jul. 2015 | Change Jul. '14 to '15 € / cbm EXW |
| Edged Boards, 0-IIIa, 23 mm + | 244-253 | 242-252 | 241-253 | -3/- |
| Rough boards in fixed dimensions, 18-22 mm | 240-252 | 240-250 | 240-250 | 0/-2 |
| Squared timber, standard dimensions, I/II, 4-6 m | 220-227 | 224-228 | 223-228 | +3/+1 |
| Stock squared timber, II/III | 165-171 | 163-171 | 163-171 | -2/- |
| Boards, III-IV, 8-16 cm, 4-6 m | 157-163 | 154-162 | 154-162 | -3/-1 |
| Boards, III-IV, 8-16 cm, just 4 m | 159-166 | 158-165 | 157-164 | -2/-2 |
| Boards, III/IV, 23 mm, 4-6 m | 160-166 | 158-165 | 157-165 | -3/-1 |
| Boards, III/IV, 28 mm +, 3-6 m | 164-174 | 168-175 | 167-176 | +3/+2 |
Particleboard plant in Canada converts to wood pellet production
A Canadian particleboard facility will be converted into a wood pellet manufacturing plant. NEWPRO has decided to start producing wood pellets at its particleboard plant in Smithers, British Columbia, after particleboard production has been stopped since January 2014.
"In 2013 the economics of foreign exchange on the particleboard world was such that it didn't make economic sense to continue to operate the plant," company officials said as cjfw.ca reports.
NEWPRO considers that comparing with the particleboard production, the new wood pellet plant will bring considerable improvement in air quality. A full consultation report will be submitted to the Ministry of Environment by August 3, however, news reports say that the application shows the conversion will result in a 94 percent decrease in total particulate matter, from 432 to 26 tonnes per year.
NEWPRO is an acronym for Northern Engineered Wood Products Inc. A privately owned company who operates two particleboard mills in Canada's North West. The Smithers BC mill has produced about 46 million square feet (3/4" basis) of particleboard per year from 1980 to January 2014. NEWPRO's Wanham mill, turned out its' first board February 2001 and is producing approximately 75 million square feet (3/4") per year.
Half world’s consumers will be from ASEAN countries by 2025
The coming into effect of the ASEAN Economic Community (AEC) at the end of 2015 is believed to be an opportunity for the Indonesian furniture industry because Indonesian furniture can readily penetrate ASEAN markets and increase market share in the region according to Indonesia's Minister of Industry, Saleh Husin.
He also said this new economic pact will present new opportunities for local companies as they will have access to the ASEAN consumer market of 620 million.
Currently the intra-ASEAN trade represents only about 25% of total exports but with almost all tariffs being abolished all ASEAN countries stand to benefit immediately and long into the future as it is forecast that by 2025, more than half of the world‟s consumers would live within a five to six hour flight from ASEAN.
According to the Asian Economic Journal the AEC could generate trade of between US$280 and US$615 billion by 2030, equivalent to 5- 12% of projected ASEAN GDP.
