The business margin for private Swedish sawmills was a meagre 1% for 2001 and the Swedish Sawmill Association (SSA) says that’s unacceptably low. But despite this the SSA maintains that mills continued to invest heavily. Now they’re reaping the benefits, with an improvement in margins forecast for 2002 as a whole, particularly for companies in south and central Sweden. While pressure in terms of rising costs and rationalisation expenses persists, average margins are expected to be up 3-4%.
It could be that the continuing concentration of the milling sector into much larger operations has helped firewall profitability, with the SSA pointing out that, following the latest round of acquisitions, the 10 largest companies now produce 8.6 million m3 a year, or approximately 55% of total Swedish output. That compares with 7 million m3 just two years ago.
Planed spruce timber
Figures for January to May show exports of Swedish planed spruce timber topping those for sawn spruce for the first time, highlighting the sector’s accelerating move into further processing and adding value. In fact this represented a rise in the three months of overseas sales of planed goods of around 33%.
In total, Swedish sawmills exported 4.97 million m3 of sawn and planed timber, an increase of 7.8% over the previous year. Of this 1.63 million m3 was planed timber, an increase of 14% on the same period last year, while the export of sawn spruce wood amounted to 1.6 million m3.
Increasing the percentage of processed timber is seen as one way of taking on increased competition from the sawmills of eastern Europe.
Also addressing industry competitiveness, a three-year Swedish/Finnish research programme on timber as a raw material has been announced by Formas (The Swedish Research Council for the Environment, Agricultural Sciences and Spatial Planning) and the Academy of Finland. At a later stage Tekes, the technological development centre in Finland, the Finnish Agricultural and Forestry Ministry and VINNOVA (The Swedish Agency for Innovation Systems) will also participate.
“Sweden and Finland are both important forestry nations and it is pleasing that we are co-operating,” said Formas manager Lisa Sennerby Forsse. “We hope we can strengthen the status of timber as an ecologically durable material and inspire further research co-operation on a wider EU perspective.”
Creating a knowledge base
The aim of the programme, she added, is to create a knowledge base for the development of innovative products based on forestry raw materials and to increase the transfer of new knowledge and techniques to users. It will promote multi-disciplinary and bilateral research projects and network building between research groups. It will also organise seminars and conferences for the industry.
In another development project researchers at Växjö University are looking at linking the various data systems used within a sawmill to optimise production. About 15 independent sawmills will be involved, along with Trätek and ÅF Process Design.
Door giant forms
Dramatic developments are under way in Swedish joinery too, with Kungsäter Invest AB and Norwegian Fjordtre-Gruppen AS combining to form Scandinavia’s second largest door supplier after Vestwood/ Swedoor.
The Fjordtre Group consists of the Norwegian company Fjordtre-Produkter AS, the Swedish company Nordbo Dörr AB and Ekodoor AB, plus the British company Ekodoor Ltd located just outside Glasgow in East Kilbride. The total turnover for the new group will be SKr350m, with annual production of 350,000 doors. The main export markets for the new group will be Denmark, Germany, Japan and the UK. Kungsäter already exports 35% of production.
“Kungsäter and Fjordtre-Gruppen complement one another with regard to range, markets and production,” points out Knut Lövdal Stauri, Fjordtre-Gruppen president. “We anticipate the merger will provide substantial co-ordination benefits.”
