Vida says demand for softwood lumber has begun to improve in parts of Europe, although weak British construction activity and high sawlog costs continue to squeeze Swedish sawmills. The company sees some recovery in Scandinavia, but does not expect a substantial upturn across its markets during 2026.<\/p>\n
Second-quarter deliveries were satisfactory, with sales improving in Scandinavia and Central Europe. Some of the additional business followed a cold, wet winter that had delayed construction work. How much of that improvement would carry through into subsequent orders remained uncertain.<\/p>\n
The UK was among the weaker markets. Vida said British construction activity may not yet have bottomed out, with suppliers competing for orders in a shrinking market. The UK is the largest export destination for Swedish sawmills, making its prolonged weakness particularly difficult for the industry, according to the group\u2019s market review in VidaNytt.<\/p>\n
Competition is putting pressure on selling prices. More pine lumber is also available, adding to the volumes offered to British customers. Since pine is widely accepted for construction in the UK, higher production can increase competition in the structural lumber market alongside spruce.<\/p>\n
For suppliers, this leaves little room to pass on expensive sawlogs and other production costs. A mill may maintain deliveries by competing on price, but satisfactory shipment volumes do not necessarily mean satisfactory earnings. Vida\u2019s account of the British market suggests that stronger construction demand is still needed before trading conditions can improve substantially.<\/p>\n
Scandinavia offered more encouragement. Vida reported signs of firmer demand there, while Central Europe also contributed to the improvement in second-quarter deliveries. The company nevertheless remained cautious about the outlook for the rest of the year.<\/p>\n
The recovery after the winter helps explain that caution. Building work restarting after weather-related delays can generate additional orders without marking the beginning of a sustained increase in consumption. Vida saw demand stabilising in several markets, but did not anticipate a general recovery during 2026.<\/p>\n
Outside Europe, deliveries to North Africa and the Middle East continued according to plan despite the conflict involving Iran. These markets continued to take lumber while European construction remained subdued.<\/p>\n
High raw-material costs are another obstacle to better earnings. In a separate interview in the same issue, Christian Nielsen, market analyst at the Swedish Forest Industries Federation, said Swedish producers were still struggling with the gap between wood costs and finished-product prices. The relationship between the two had yet to return to a level that would restore profitability.<\/p>\n
Nielsen said demand for Swedish softwood lumber had held up better than might have been expected, partly because competing producer countries had difficulties securing raw materials. Those constraints have helped Swedish mills find buyers despite weak construction activity.<\/p>\n
He nevertheless described a further cooling of demand during 2026 as global uncertainty affected business. There were signs of gradual improvement, but little to suggest a sharp increase in orders. Longer-term demand from wood construction remained a reason for optimism.<\/p>\n
Sweden\u2019s own forest resource offers a more favourable long-term outlook. Drawing on Swedish Forest Agency scenarios, Nielsen said the country\u2019s harvesting potential was expected to remain relatively stable over the next five to fifteen years, with the possibility of an increase beyond that period.<\/p>\n
That estimate concerns national harvesting potential. Mills can still face shortages or expensive procurement in individual regions, while storms, insect damage and changes in harvesting affect the volumes reaching the market from year to year.<\/p>\n
Nielsen said Sweden was better placed than Germany and parts of Central Europe, where extensive bark beetle damage has affected forests and future wood supply. The loss of forest resources in those countries has increased the importance of Swedish supply to European buyers.<\/p>\n
For Swedish sawmills, however, access to a substantial forest resource has not prevented sawlog costs from rising to difficult levels. The immediate problem is obtaining enough revenue from lumber to cover those costs in markets where customers remain cautious and competing offers are readily available.<\/p>\n
Vida\u2019s outlook allows for further improvement in Scandinavia and other destinations, but the weak UK market continues to limit expectations. A recovery in orders is beginning in places; a substantial improvement in lumber prices and mill earnings has yet to follow.<\/p>","protected":false},"excerpt":{"rendered":"
Vida says demand for softwood lumber has begun to improve in parts of Europe, although weak British construction activity and high sawlog costs continue to squeeze Swedish sawmills. The company sees some recovery in Scandinavia, but does not expect a … Continue reading