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The annual \"Wood from Finland\" conference which took place on February 15 and 16, 2023 in Helsinki attracted a record audience: nearly 500 global wood professionals gathered to update the short and long-term outlook for industry. In addition to market overviews by country, presentations were made on topics such as the global economy, the situation in China and the future exploitation of natural resources.<\/p>\n
The event was opened by the Minister of Foreign Affairs, Mr. Pekka Haavisto, who presented the situation of global security policy. Beyond the strong support that Ukraine needs, Minister Haavisto underlined the importance of dialogue within the EU.<\/p>\n
\u201cOpenness must be maintained, both in terms of trade and investment. The diversification of the economy is also necessary and a dialogue with the United States is essential to avoid trade barriers between Europe and the United States\u201d.<\/p>\n
Minna Kuusisto, senior analyst at Danske Bank, said the outlook for the global economy is more positive than expected. Inflation peaked and several banks revised their growth forecasts upwards. Instead of the announced recession, the economy should grow for three reasons. A mild winter and the elasticity of demand observed in the electricity market made it possible to stem the rise in energy prices and bring electricity prices back to their pre-war level. The economy has also received a boost from China, where the market has opened up since COVID. The third factor is a strong labor market and, therefore, a record unemployment rate. However, the acceleration of inflation due, among other things, to rising demand for commodities in China remains a near-term risk and interest rates will remain high for some time to come. Regarding longer-term economic and business trends, Mr. Kuusisto highlighted geopolitical risks, new professionals such as increasing ESG requirements and changes in global demographics.<\/p>\n
In her presentation, Lauri Hetem\u00e4ki, Professor of Working Life at the Faculty of Agriculture and Forestry, University of Helsinki, explored future challenges and opportunities for the global forestry sector. He noted that while the demand for forests and wood raw materials is expected to increase by up to 25% by 2050, their use will also diversify. To remain sustainable, forest users will increasingly have to find synergies and minimize the negative impacts of the exploitation of nature.<\/p>\n
\u201c However, the wood products industry can play a key role in realizing a sustainable future, especially in cities ,\u201d stressed Mr. Hetem\u00e4ki.<\/p>\n
Changes in global commodity flows<\/strong><\/p>\n China, an important export market for Finnish lumber, has suffered from the consequences of COVID. The country's GDP fell sharply in the first quarter of 2021, ending last year at 3%. Now that the restrictions have been lifted, China is counting on a slow and gradual market recovery, with GDP growth expected to reach 6% next year.<\/p>\n Lumber imports are expected to pick up as production levels increase. In 2022, imports of lumber and logs are back to 2015 levels \u2013 a decline of around 10% for lumber, to 17.3 million cubic meters. The market is dominated by Russia, which managed to increase its market share to 69% even during the downturn. Last year, Finland exported a total of 881,000 m3 of sawn timber to China, and despite declining imports, Finland increased its market share from 3.5% to 5.1%. This is largely due to Canada's declining market share. Russia's potential to increase export volumes to China is limited by logistical and harvesting challenges.<\/p>\n In the United States, about 83 million cubic meters of wood was used last year, of which just over a third was allocated to new construction. However, the new construction boom that lasted a few years has come to an end and new housing starts are expected to fall slightly below normal levels to around 1.3 million this year. Lumber consumption is expected to decline by about 6%.<\/p>\n In Canada, particularly in British Columbia, lumber production volumes fell sharply. Over the past ten years, production has decreased by up to 30%. The main reason for this is the insect infestation that has plagued the region for several years, reducing logging opportunities and leading to cuts in sawmill production due to raw material availability issues. The wood shortage in the North American market has been partly filled by Europe, but new mills have also sprung up in the southern United States, increasing the country's wood production capacity by 40%.<\/p>\n At the end of the event, Tino Aalto, President and CEO of the Sawmill Industry Association, described the environment in which the industry operates and stressed the importance of active lobbying to maintain a healthy environment for the sawmill industry. Several initiatives are under discussion at national and European level and may have an impact on issues such as the availability of raw materials and logistics costs. According to the CEO, decision-making should focus more on improving competitiveness and ensuring the availability of wood raw material. Mr. Aalto closed the event with a positive message: the best days in the industry are yet to come.<\/p>\n \u201c The sawmill industry is not a problem, but an important part of the solution in the fight against climate change \u201d.<\/p>\n The Sawmill Industry Association is the representative organization of the independent sawmill industry, founded in 1945. It has 30 member companies, which account for just over half of Finland's sawnwood production. The export value of sawn timber and its processed products in 2021 was around \u20ac2.9 billion. All inputs are domestic. Sawn timber represents two-thirds of forest owners' cutting income. Sawn wood is a sustainable and climate-friendly renewable material, the demand for which is constantly growing.<\/p>","protected":false},"excerpt":{"rendered":" The annual “Wood from Finland” conference which took place on February 15 and 16, 2023 in Helsinki attracted a record audience: nearly 500 global wood professionals gathered to update the short and long-term outlook for industry. In addition to market … Continue reading