Södra’s profits between January-September operating profits halved to SKr311m, compared to a year ago.

But Södra said it was “very pleased” about increasing sawmill productivity and a sawn timber price recovery.

“Södra Timber has been meeting its profitability requirement since September and we expect that to continue during the rest of the year,” said Södra president and CEO Leif Brodén.

“On a global basis, sawlogs are in short supply and we have adapted to the ongoing weak demand.

“We anticipate an upturn in new housing construction next year in the US and other countries, albeit from a very low base. The shortage in the timber market is expected to continue in 2010 and hold back production increases.”

Södra’s group sales were SKr12.6bn, down from SKr13bn a year ago.