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Swedish market update – Estonia expanding their market shares

From early 2017 to the first half of 2018 log and wood chip supply has been tight for sawmills and pulp mills in Sweden as the forest industry has been running in high gear. Consumption of wood raw material has increased since 2017, especially in the pulp sector, which struggles to supply their mills during the winter. As a result, the Swedish softwood log imports were up over 25% during the first 4 months of 2018 as compared to the same period in 2017, and imports of hardwood pulp log were up over 70% in the same period. When the weather improved after a bad winter, Estonia’s softwood logs exports to Sweden were up 42% in 1Q 2018 compared to 1Q 2017. So far, Estonia and Finland have expanded their Swedish market share the most.

One of the biggest changes in supply sourcing over the past five years is a decreased shipment of Latvian softwood logs to Sweden. The supply of softwood logs from Latvia has declined because of higher domestic demands. Over the past few years, investment within the forest sector in Latvia has increased significantly, which results in a higher domestic production capacity and demand.

Last winter, the Swedish stock had fallen by 35% – which traditionally is a warehouse period because of bad weather conditions. As a consequence of the current fire situation in Sweden with over 25,000 hectares of forests destroyed, it is most likely that log imports will continue increasing during the second half of 2018.
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