Iwelumo was set to join the Clarets on tour but his name was removed as the transfer went through and Howe confirmed he couldn't guarantee him games.
"Chris is a great pro and he worked extremely hard for us," Howe said. "I couldn't guarantee him first team football though, so he decided to move on and we wish him well.
"We are working on a replacement because we need another striker. I don't want to go into the season with just three, so we will be working hard to bring one in."
The boss had always wanted to get his transfer business done early but it's not quite worked out that way. He added: "In an ideal world we wanted to get the squad together for the first day of pre-season.
"It hasn't quite worked out like that and we are getting the squad together quite late, which always leaves a short time to prepare the team. As I've said all along though, we don't need a huge amount, but we do need two or three quality additions and hopefully we can get them in soon, because we want to integrate them with the players."