No doubt the most dramatic development in the Norwegian timber sector last year was a massive increase – from just 11,000m³ to 351,500m³ – in softwood exports to Iceland. The reason for the jump was major reconstruction works following the country’s major earthquake.
There was also a large increase in exports to the UK and Sweden. The latter seemed to be largely down to the close relationship between the Norwegian and Swedish timber industry via the Moelven business. Transit trade through Sweden to markets like Japan and countries outside Europe has always existed and, with the internationalisation of the timber industry in Norway achieved by Moelven and the former Norske Skog company, this has increased. Other Norwegian timber and roundwood traders also see their products going further afield via Sweden.
Looking ahead, this third party trade could increase, making it increasingly difficult to determine the origin of products. Certification of timber could then take on added significance for Norway; not just establishing products’ environmental credentials, but also establishing the source and quality of the logs.
The actual export figures for 2000 are far removed rom the estimates presented at the meetings of the Timber Committee and the Softwood Conference in 2000. Exports were estimated to reach 750,000m³ in 2000 and 725,000m³ in 2001. The final figures, presented by the Norwegian bureau of statistics, put these at 1.096 million m³ and 771,000m³ respectively.
This again underlines the fact that activity in the building products market is increasingly dominated by a few, large international companies. How they handle the flow of products, including timber, is only known by them and the information does not seem to flow back to the producers. And it is thought that even the official trade figures, which are notoriously difficult to interpret, while being more accurate, may not be 100% on the ball.
The Norwegian economy is still very strong, largely thanks to the oil and gas industries. Other industries are also doing well because of strong activity in construction.
Building activity is forecast to increase slightly in 2001. However, there are now some signs that activity will slow. There is a skills shortage in the building sector, partly because much of the labour force went to Sweden when building activity increased there in 2000. In addition, few young people seem to want to work in the industry. Another problem now is that house prices have risen so much in some areas that people are being priced out of the market and new buyers are not coming in on the first rung of the property ladder.
In the timber sector discussion about ownership continues to be a hot topic. The Norwegian forest owners association wants to take a controlling interest in the new Moelven operation. It would like to have the same position it had in Norske Skog and, through this, control the development of Moelven’s sawmilling activity – as well as use Moelven to restructure the Norwegian timber industry.
The industry has also been working towards securing more co-operation with Finnish and Swedish forest owners and their timber sectors.
New regulations banning the use of CCA impregnated wood have been discussed widely. The treatment sector is a vital component of the Norwegian sawmilling industry as it has enabled the use of lower quality pine. According to sources in the sector, the solution to the problem will not be clear before this summer at the earliest.
Norwegian research institutes are working on a number of projects that could create new market opportunities for timber and there is increasing co-operation between the research institutes. Besides new applications, the goal is clearly to add value to Norwegian production. The co-operation already established is promising and the next step will be co-operation in marketing and promotion.
Perhaps the key problem facing the industry is its structure. Consequently, Norwegian forestry’s efforts to form a new ‘Norske Skog’ to make the timber products sector more manageable and cohesive are not surprising.
Forestry activity in Norway in 2000 was low, with removals at about 7 million m³ compared with 10 million m³ 10-12 years ago. This means that Norway accounts for just 4-5% of harvesting in the Nordic and Baltic regions.
Because Norway’s end users seem unwilling to pay forest owners a decent return, the country still imports a large proportion of its round wood requirements. It is difficult to see this situation changing any time soon. In the past,the government spent heavily to improve the forest sector’s competitiveness, but its investment now seems to have dried up.
