Finnish sawmills are benefiting from the strong demand both within Finland and from Japan, which has resulted in a high operating level. This is according to a report issued by the Employment and Economic Development Centre and the Finnish Trade and Industry Ministry in November.
In Finland, housebuilding, in particular, is driving sawn timber demand.
Production of sawn timber in Finland for 2003 is expected to be higher than the 2002 level of 13.3 million m3. Total exports of sawn and first stage processed products in 2003 are expected to be at the same level as for the past two years, at 8 million m3, although within this figure sawn timber exports will have grown slightly, while first stage processed products will be slightly reduced. Production and export quantities of treated timber, glulam and heat-treated wood are expected to show an increase for 2003 compared with the previous year, according to the report.
The report also states that the uncertainty in the economic forecasts for Europe, the US and Japan, as well as the strong euro, is causing uncertainty on the market. Furthermore, changes in forest taxation regarding raw material supplies and the maintenance of the conditions for the import of logs from Russia makes assessing developments in the near future more difficult. It is predicted that eastern European sawing capacity will rise 6 million m3 in the coming years. As a result, there will be more first stage processed products on the market undoubtedly impacting on Finnish sawmilling. The industry has recently invested heavily to increase competitiveness, but the new report says it needs to do more to improve service and increase processing added-value.
Another report on timber house manufacturing says that industrialisation of production and export growth have boosted sales. Total house production for 2003 is forecast at 13,000, a rise of 1,000 over the year before. Log houses account for the bulk of exports, with a total value of €120m. Production of modules for wooden houses also increased substantially in 2003, with exports worth €30m.
Joinery demand
The report also points out that demand for joinery products such as windows, doors and roof trusses has remained stable and has come mainly from the domestic market. For Finnish parquet flooring, the export market is proving strongest.
Finland’s forest products industry is strongly opposing a proposed new plant health directive under which all coniferous wood imported into the EU would have to be inspected before crossing the border. If this comes into force, the industry says it will be more difficult to import Russian timber and inspection fees will drive costs up.
“Finland’s forests are fully utilised and Russian imports are needed to maintain production. Finland has been importing roundwood from Russia since the 1890s and there are no signs of pests entering along with imported wood,” said Hannu Valtanen, director of the Finnish Forest Industries Federation. And, as proof, he points to studies from the Finnish Forest Research Institute and inspections by Finland’s Plant Production Inspection Centre, which have not found pests in imported wood.
The Finnish Forest Industries Federation’s position is that as long as there is no proven threat from pests, wood imports should be allowed to continue as before without phytosanitary certificates. As an alternative, it proposes that the national plant inspection authority continues its sample inspections, increasing them if necessary and reporting results to the EU.
Finnish company JMC Finance Oy is investing €35m in two sawmills and a furniture factory in Russian Karelia. The deal was signed by the head of the Republic of Karelia, Sergei Katanandov, and JMC chairman Kalevi Laurila in January and an agreement has been drawn up between JMC and the Karelian timber enterprise Karellesprom. The mills will be built in the Karelian regions of Muezersk and Pudozhsk and the furniture factory in Petrozavodsk. The mills are expected to open in two years and the furniture factory in five.
