Summary
• Finnish sawn timber output and exports rose in 2010, but are slowing into 2012.
• But timber sector capital investment is up.
• Stora Enso bills its cross-laminated timber solutions as the dawn of a new era.
• UPM Kymmene is developing and rebranding its processed products range.
• Finnforest sees major potential for its Kerto Ripa construction system.

Like Finland’s economy overall, the country’s timber and forestry sectors recovered strongly through 2010 and into the early part of 2011. However, renewed global economic uncertainty has led to predictions that both the country and its wood industry will grow more slowly, or stagnate in 2012.

Industrial roundwood use in 2010 jumped over a fifth to 54 million m³ and combined imports of roundwood and wood chips increased 42% to 10 million m³. Even shipments from Russia rose, despite the €15/m³ export duty, which in 2009 had helped halve them.

In 2011 growth continued, albeit at a slower pace. Roundwood consumption is expected to rise 4% to 56 million m³ for the year, and imports 10% to 11 million m³. The Finnish harvest total is forecast at 47 million m³.

However, in 2012, as the market weakens the latter figure is expected to dip to 45 million m³.

After a significant fall in the depths of recession in 2009, Finnish sawn softwood production recovered in 2010 to 9.4 million m³ and a further 10% rise is expected for this year. Output has been boosted by both demand at home and abroad, with exports rising 22% in 2010 and 8% in the first half of this year.

Overall the split between domestic and foreign sales for the last two years has been around 39%/61%. The UK accounts for about 7% of exports, and the rest of the EU just under 20%.

However, slowdown has set in again in both domestic and export demand, with the Finnish Construction Industries Confederation reporting renewed contraction in Finnish home building and global economic uncertainty unsettling foreign markets. Production growth for 2011 overall is forecast at just 3% and in 2012 both output and exports are expected to be static.

The Finnish plywood sector also recovered strongly in 2010, fired by 11% growth in consumption in the rest of Europe. Exports jumped 23% and the first six months of this year saw a further 12% increase. However, business has slowed recently, so export growth for the year is forecast at 14% with next year’s output plateauing at 1.1 million m³. Chipboard and fibreboard production is also forecast to be static at 200,000m³ and 100,000m³ respectively.

There has been growing concern over increasing demand for ‘green energy’ and the resulting rise in woodfuel consumption. The latter already accounts for 20% of all energy production in Finland and the timber sector fears further growth could leave it short of raw material. But Finnish Forest Industries Federation (FFIF) director-general Timo Jaatinen said the government’s new National Forest Programme aims both to increase the country’s annual harvest to 70 million m³ by 2015 and ensure that “renewable energy subsidies will not distort the timber market”.

There have been positive developments too in environmental certification. Around 95% of the country’s forest is now covered by the PEFC-endorsed Finnish Forest Certification Scheme. This year also saw the launch of the Finnish national FSC standard. UPM is one of the first to secure it, with half its 0.9 million ha of forests (already 100% PEFC accredited) now covered.

On another bright note for the future, the Finnish forest products sector’s capital investment this year is forecast to increase €250m to €900m. One-third, says the FFIF, will cover ‘rationalisation’ costs, but the remainder will go on replacing and modernising existing capacity and boosting output.

All figures are from the UNECE.