Raw material shortage looms, says forestry board

In a recent survey of large companies Statistics Sweden concluded that although there there has already been a substantial growth surge in the Swedish economy, it has not peaked yet. The leading companies in the forest industry agreed that the best was yet to come, predicting that the peak will probablycome in the second half of 2005 or later.

There are, however, two major concerns on the horizon: a potential shortage of timber and the cost and supply of energy. The latest figures issued by the National Board of Forestry indicate that the margin between forest growth and demand for raw material has disappeared as a result of increased felling in recent years. They say that long-term sustainable development is threatened and that the Swedish forest industry can no longer rely solely on domestic supplies of raw material. The shortage is worst in the north of the country.

However, a report just issued by the Swedish Forest Industries Federation contradicts the National Board of Forestry's warnings and points out that Sweden has never had more forest. "The forest is a renewable raw material which we should use more of," said Stefan Wirtén, forestry director for the Swedish Forest Industries Federation. "It is therefore good for both the economy and environment if we can increase harvesting, which our calculations show that we can do."

One concrete result of the current situation is that Sveaskog has decided to reduce harvesting in the north of Sweden by 15%. "Sveaskog is giving priority to sustainable and long-term forestry, which is why we have decided to reduce felling," said CEO Gunnar Olofsson.

On the energy front, strong feelings have been expressed at the government's decision to enforce the shutdown of the second nuclear reactor at Bärsebäck power station. This has delighted the inhabitants of Copenhagen, which is near Bärsebäck, but infuriated major industrial users of electricity, not least the forest industry. Industry representatives, among them Marie Arwidson of the Swedish Forest Industries Federation, point out that Sweden imported almost 10% of its electricity consumption last year and that energy policy should aim to increase domestic production.

There have been closures in the Swedish sawmill sector recently, among them the plants at Rockhammar, Lenhovda and Lövåsen owned by Rottneros, Södra and Hedin-Bergkvist respectively. "The market continues to be a difficult one for Swedish sawmills," said Åke Bergh, CEO of CF Berg. "Prices for sawn timber are weak, yet at the same time there is a tendency for raw material prices to rise." He suggested that further reorganisation of the industry was needed in order to help to improve conditions.

Sawmill spending

At the same time, there continues to be investment in the sector. Martinsons Trä recently acquired Wallmarks Såg AB, a well-established sawmill just south of Skellefteå and is constructing a new sawmill in Bygdsiljum at a cost of SKr160m. "This is the biggest sawmill investment made in Sweden in recent years," points out Olov Martinson, production manager at Martinsons Trä.

Another major sawmill investment is being made by the Setra Group at its Heby sawmill. The company is spending SKr72m and the work is due for completion in autumn next year. "Heby sawmill is a modern facility that lies at the forefront of the sawmill industry," said CEO Anders Nilsson. "We are now investing even more in order to ensure the facility's position as one of Sweden's leading whitewood sawmills."

Meanwhile, four companies have formed an alliance to market a modular decking system. The product, which is being launched in 200 DIY stores throughout the UK, is the result of co-operation between SCA Timber and three businesses in north of Sweden – Nordingrå Trä, Nylands Trä och Träimpregnering and Träteam Bröderna Nyberg. Produced specifically for the DIY market, the system is available in various sizes and designs and includes accessories such as balustrades, steps and pergolas. The project is an offshoot of the "Ywood" initiative, which aims to increase co-operation and processing among companies in the province of Västernorrland.

"The modular system has been developed to fulfil a need that we have identified through contacts with customers in the UK," said Lennart Wilhelmsson, development manager for SCA Timber. "Decking is very popular at the moment, but most people have to engage a carpenter in order to erect it, whereas our system will be the first one to be both ready and easy to install."

The system will be marketed by the Focus group of DIY stores. The SCA Timber Supply sales and distribution company in the UK will be responsible for keeping the stores supplied with products.

Towering achievement

Another interesting development from the Swedish industry is a new control tower built entirely from wood at Skellefteå airport. The 23m tower, which cost SKr15m, has a facade of full-length 300mm wide glulam panels, which means that there are no joints. Glulam beams support the roof, while weatherboarding is used to frame the windows. The architect was Ingemar Sjöstrand and the wood was supplied by Martinsons Trä of Bygdsiljum, one of northern Sweden's largest private sawmills and one of Europe's largest manufacturers of glulam beams.