Teak Prices

With so many companies offering very lucrative profits from Teak, I did some investigating into what the prices for Teak really are. I went to the most objective source of information I could find: The ITTO report on timber prices. You can download it here.

What I found were quite different prices from all that is advertised out there by various Teak companies. 

On page 7 you will find the actual prices for plantation Teak, coming from Central and South America. You have to understand that there is a big difference between the price and forestry company gets for its Teak and the price the consumer eventually pays for it. Here's how it works:

1. The Teak plantation sell its Teak to an export company.

2. The export company then ships it overseas to an import company.

3. The import company then sells to various companies who process the Teak into furniture or any other means it used for.

4. The end product is then sold to the consumer.

We at Robinia Invest only calculate the prices we get for our Robinia, to be those that are paid by manufacturing companies. We sell quite a rough product, only debarked perhaps, to a company who then uses the timber to process further. That's why we only calculate a price of € 250 per m³. If we were to simply sell the harvested logs to a company, the price would be much lower. The more work you put into it, the higher price you can sell it for, but the more costs you will first have to make.

There is a limit on how far a timber producing company should go into this process. Sure, you could make the end product, which fetches the highest price, but then you first have to invest in a large sawmill, hire a lot of skilled employees AND find distributors to sell your end product. I don't know of any forestry company who does this.

For the Teak companies do this, would mean that they would have to set up their own export company and distribution network in the US, where their plantation timber is finaly sold. I'm sure none of them have such a network.

So this means that they will harvest the trees, MAYBE bring them to a sawmill, but that's that! They will either sell to a sawmill or to an export company. Since there are many more links in the chain, before the end product reaches the consumer (and all parties want to make money), the price the export company or sawmill is willing to pay for it, won't be much at all.

Just think about this, before you invest all your savings into Teak.

Wouter Bakker