The economic situation of the German sawmilling and timber industry remains strained, according to the latest report from the German Sawmill and Timber Industry Association. (DeSH).
Ther Berlin-based group, which represents German sawmillers, says the persistently weak construction sector, the global economic and sales crisis, high raw material and production costs, and mounting cost pressures are placing a significant burden on domestic companies.
It warns of a further deterioration in the situation. In the coming weeks, DESH says many companies will be forced to scale back production capacities and extend scheduled maintenance periods.
“Despite promising rhetoric from policymakers, the hoped-for recovery of the domestic construction industry has yet to materialize,” it said.
“Demand for construction timber in key export markets also remains subdued due to geopolitical crises and a global economic slowdown. At the same time, persistently high costs for raw materials, energy, and production are burdening companies in the sawmill and timber industries. As a result, German production sites, in particular, are increasingly falling behind in the European competitive landscape.”
DESH says while raw material and energy costs in Germany are the highest in Europe, the market is being flooded with timber products from neighbouring European states and other countries where raw material and energy costs are significantly lower.
“Without a noticeable recovery in sales markets and relief regarding production costs, companies face the threat of significant production cutbacks, leading to short time work and further job losses.”
DESH is calling for a reliable economic policy framework that strengthens the long-term competitiveness of the domestic sawmill and timber industries. This includes a competitive supply of energy and raw materials, reduced bureaucracy, and investment incentives for the construction industry and climate-friendly timber construction.
