The UK Forest Products Association (UKFPA) said the closure of Gwyddelwern sawmill was “particularly disappointing” and came at a time of increasing wood supply pressures in Wales and The Marches.
The mill, near Corwen, is now in the hands of businesses recovery and insolvency practice DS Services.
“One of the problems the business had for a long time was securing enough raw material,” said Martin Williamson of DS Services. “It’s a real shame we are having to deal with this company because customer demand was there.”
Mr Williamson said the mill had turned to Scotland for supplies after being unable to secure enough logs from Forestry Commission Wales.
“They were trying to get hold of timber from Forestry Commission Scotland and were prepared to pay over the odds for it. But the commission was not able to provide it.”
He said the mill site and machinery would either be sold as a lot or broken up.
UKFPA executive director David Sulman said raw material supply problems have led to people in the trade questioning the Welsh Assembly’s objective of establishing Wales as “the location for world class forest businesses”.
“Such a dramatic reduction will clearly have very negative impacts on the sector and only time will tell if other business failures will be seen,” he said.
Forestry Commission Wales admits that its raw material volumes have declined by about 20% from three years ago but says it was ahead of schedule in supplying contracted volume when the mill closed. It also said the mill did not bid in timber sales last September and December.
