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The reason, the wood industry says, could not be simpler - biomass subsidies have increased demand for wood, pushing prices higher.

As Dr Peter Beele at the Furniture Industry Research Association says: "There is no doubt the two are connected".

Alastair Kerr at the Wood Panel Industries Federation is even more unequivocal, arguing that timber prices are significantly higher than five years ago despite the economic downturn. "The only factor is biomass," he says.

This will disadvantage because most of IKEA products are made from wood, now it will cost them more to manufacture the same products. Since UK is a world-leading economy, this trend can spread out widely and quickly. 

Source: 
http://www.bbc.co.uk/news/business-15756074

 





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