The international economy may be tough, but diversified Swedish sawmiller Setra has opened a third timber house factory and is investing in new grading technology.
It’s part of a continuing strategy, said managing director Mikael Eliasson, to make best use and get maximum value from raw material and tailor products and service to the customer.
In common with other Swedish mills, Setra is curtailing production in response to deteriorating market conditions.
“Business has been more resilient in Germany and France, the UK has been better this year than last, and North Africa has continued to account for a good share of Swedish timber exports, in spite of political instability,” he said “But overall the export market has become more difficult and in Sweden customers are also more uncertain. So, like the rest of the industry, we’re adjusting output in line with demand.”
But Setra had pushed ahead with adding a third plant to its Plusshus timber building business in Skellefteå because, while it still only accounts for 5% of turnover, it has “major potential”.
“There is momentum towards building in timber in general because it’s renewable and energy saving in construction and use,” said Mr Eliasson. “There is also a programme in Sweden to increase use of multi-dwelling and multi-storey timber frame and a project called Trästad (Timber City) in southern Sweden focused on developing timber construction generally. In addition, Plusshus sells in Norway, which is doing very well thanks to energy prices.”
Besides the “standard carcassing-based” approach to timber construction, Plusshus is also increasing use of “semi-massive” laminated panels made at Setra’s three glulam factories.
The new plant will focus on terrace-type housing. Whether it will look at the UK market remains to be seen. “The UK, like other European countries, is going in for more prefabricated timber building, but has a lot of good companies of its own, and currently we’re concentrating on Sweden and Norway,” said Mr Eliasson. “But, as Europe moves to more common building platforms, regulations and so on, you never know.”
Setra’s other investment, in X-ray grading technology, forms part of developments at its Skinnskatterberg mill which will increase output from 250,000m³ to 350,000m³ a year.
“This is part of our effort to raise productivity and yield, but also get the right product to the right customer, so they waste less wood and in terms of transport – we want to eradicate as many unnecessary costs for them as possible,” said Mr Eliasson. “Mills have historically been the best paying timber users, but there’s growing competition from the energy sector and fuel prices mean logistics costs are rising; when you only get half a tonne or 1m3 of timber from two tonnes of wood, you have to get it right.”
There is a trend to bigger, more productive mills generally in Sweden, with Södra and Holmen, for instance, this year opening new 750,000m³ capacity mills.
“But the drive for us will not be for volume and efficiency at all costs,” said Mr Eliasson. “We will also remain flexible so we can meet customers’ precise needs.”
