{"id":99867,"date":"2026-09-08T04:39:58","date_gmt":"2026-09-08T04:39:58","guid":{"rendered":"https:\/\/www.timberindustrynews.com\/?p=99867"},"modified":"2026-09-08T16:49:49","modified_gmt":"2026-09-08T16:49:49","slug":"gwmi-forecast-finlands-sawmill-recovery-is-pushed-into-2027","status":"publish","type":"post","link":"https:\/\/www.timberindustrynews.com\/ro\/gwmi-forecast-finlands-sawmill-recovery-is-pushed-into-2027\/","title":{"rendered":"GWMI Forecast: Finland\u2019s sawmill recovery is pushed into 2027"},"content":{"rendered":"
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Finland\u2019s sawmill industry is approaching the final months of 2026 with a market equation that has become harder rather than easier to solve. Global Wood Markets Info (GWMI) expects production to remain below last year, as export volumes weaken and several companies reduce costs or concentrate output at newer mills. Yet the decline in industrial activity has still not produced the substantial reduction in sawlog prices required to restore margins.<\/p>\n

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The first half of the year removed much of the optimism contained in the forecasts published during spring. Finnish sawmills produced approximately 6.1 million m\u00b3 of softwood lumber between January and June, 3% less than one year earlier. Spruce lumber production fell by around 6% to 3.0 million m\u00b3, while pine production remained close to 3.1 million m\u00b3. Export revenues declined by about 5% to \u20ac870 million.<\/p>\n

The contraction was considerably steeper when measured by export volume. Finnish Customs data show that shipments during January\u2013May fell by 14.8% to 2.89 million m\u00b3. Export value declined by 13.2% to \u20ac740.8 million, while the average customs value increased by just under 2% to approximately \u20ac257\/m\u00b3.<\/p>\n

That combination describes the Finnish market more accurately than any isolated production or price figure. Mills received slightly more money for each exported cubic metre, but sold far fewer cubic metres, while the main raw material needed to produce them remained close to historically exceptional price levels. The higher average export value was also partly the result of a different destination and product mix, rather than evidence that mills had succeeded in raising prices across their order books.<\/p>\n

The recovery expected in spring did not arrive<\/h2>\n

During spring, Pellervo Economic Research expected Finnish softwood lumber production and exports to increase by approximately 4% in 2026, accompanied by a 3% improvement in export prices. The reasoning was understandable at the time. Industrial standing inventories had declined, wood use had increased and timber purchasing was expected to recover after an exceptionally quiet winter. A gradual improvement in European construction was also expected to support demand.<\/p>\n

The price component of that forecast has come relatively close. Average export values did increase during the first five months. The volume forecast, however, has been overtaken by the market. Production was already down 3% in the first half, exports fell much more sharply, and the industry entered the second half with further curtailments, workforce reductions and no convincing recovery in European construction.<\/p>\n

GWMI now expects Finnish softwood lumber production to finish 2026 below last year, most probably close to 11.2\u201311.3 million m\u00b3. Finland produced 11.7 million m\u00b3 in 2025, meaning that the industry is heading towards a reduction of around 4% rather than the increase anticipated during spring. A stronger fourth quarter could narrow the decline, but reversing it would require a level of production and export activity for which there is currently little evidence.<\/p>\n

The adjustment will not be evenly distributed. Spruce has retained better support in several European markets and can be directed towards a relatively broad range of construction and industrial applications. Pine producers face a more difficult combination of weaker overseas demand, long transport distances and strong exposure to North Africa, the Middle East and Asia. These markets remain necessary outlets for Finnish production, but several of them are purchasing substantially less than one year ago.<\/p>\n\n\n\n\n\n\n\n\n\n\n
Indicator<\/th>\nLatest result<\/th>\nDirection for the rest of 2026<\/th>\n<\/tr>\n<\/thead>\n
Softwood lumber production<\/strong><\/td>\n6.1 million m\u00b3 in H1, down 3%<\/td>\nBelow 2025; full-year output estimated near 11.2\u201311.3 million m\u00b3<\/td>\n<\/tr>\n
Spruce lumber production<\/strong><\/td>\nApproximately 3.0 million m\u00b3 in H1, down 6%<\/td>\nLower, although European demand offers more support than for pine<\/td>\n<\/tr>\n
Pine lumber production<\/strong><\/td>\nApproximately 3.1 million m\u00b3 in H1, broadly unchanged<\/td>\nIncreasing pressure from weaker Asian and MENA demand<\/td>\n<\/tr>\n
Export volume<\/strong><\/td>\nDown 14.8% in January\u2013May<\/td>\nThe annual decline should narrow, but remain considerably larger than the production decline<\/td>\n<\/tr>\n
Sawlog costs<\/strong><\/td>\nStill close to recent record levels<\/td>\nSome easing is probable, but not enough to repair margins on its own<\/td>\n<\/tr>\n
Mill utilisation<\/strong><\/td>\nLower at several sites<\/td>\nProduction increasingly linked to confirmed orders rather than capacity targets<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Sawmills are buying much less timber, but the logs they need remain expensive<\/h2>\n

The roundwood market has not delivered the relief normally associated with declining sawmill production. Industrial roundwood purchases from private forests were 28% lower year on year during January\u2013May and remained 21% lower during the full first half. Compared with the five-year average, sawlog purchases were down approximately 18%, while pulpwood purchases were 24% lower.<\/p>\n

Prices nevertheless strengthened during June. Spruce sawlogs reached an average standing-sale price of \u20ac83.65\/m\u00b3, pine \u20ac78.52\/m\u00b3 and birch \u20ac64.39\/m\u00b3. Buying subsequently slowed during the summer holiday period and prices started to ease, but the movement was too small to alter the economics of sawing. Recent reported levels remained close to \u20ac82.65\/m\u00b3 for spruce and \u20ac78.35\/m\u00b3 for pine.<\/p>\n

The market is therefore producing an unusual result: significantly fewer transactions without a corresponding fall in sawlog prices. Forest owners entered 2026 after receiving a record \u20ac3.7 billion in stumpage revenues the previous year. Many remain prepared to postpone sales rather than accept materially lower bids, particularly for good spruce-dominated regeneration stands.<\/p>\n

Sawmills can reduce purchases for a period, especially when finished-product orders are weak, but they cannot remain outside the timber market indefinitely. Standing inventories declined during 2025 because harvesting exceeded new purchases. Mills that intend to maintain production through the winter will have to secure new harvesting programmes during the autumn, limiting the extent to which they can force sawlog prices lower.<\/p>\n

This is why a gradual reduction in sawlog prices should not be confused with a return to inexpensive raw material. The annual averages will probably finish below 2025, but much of that change will come from comparison with last year\u2019s exceptional peaks. Delivered wood costs will also continue to include harvesting and transport expenses, which remain important in a country with long procurement distances and an export-oriented industrial structure.<\/p>\n

The price difference between logs and pulpwood adds another layer to the market. Pulpwood prices have fallen much more sharply from last year, encouraging discussion about whether part of Finland\u2019s smaller-diameter wood could be directed towards sawing. This may improve fibre utilisation at individual plants, but it does not replace the larger, higher-quality logs needed for construction lumber, joinery grades and demanding export customers.<\/p>\n

The export problem extends across several markets at once<\/h2>\n

Finland could normally compensate for weaker demand in one destination by redirecting production elsewhere. That becomes considerably harder when several important markets contract simultaneously.<\/p>\n

During January\u2013May, deliveries to Egypt fell by 21.1%, the United Kingdom by 31.9%, Japan by 29.6%, Saudi Arabia by 44.8%, Israel by 24.5% and China by 34.1%. Morocco bought 61.4% less Finnish lumber. The UK and Japan alone purchased almost 199,000 m\u00b3 less than in the same period of 2025.<\/p>\n

The decline in Egypt removed more than 114,000 m\u00b3, although the country remained Finland\u2019s largest destination. Egypt continues to provide an important outlet for volume, but its average customs value of approximately \u20ac184\/m\u00b3 was far below the values obtained in major European markets. China was even weaker from a price perspective, with an average value of \u20ac177\/m\u00b3, down sharply from one year earlier.<\/p>\n

European trade provided the main counterweight. Shipments to Germany increased by 22%, Italy by 21.3%, the Netherlands by 9.1%, Poland by 18.3% and Lithuania by 19.8%. Germany bought more than 206,000 m\u00b3 at an average value of \u20ac287\/m\u00b3, while Italy\u2019s average reached \u20ac302\/m\u00b3.<\/p>\n

These gains explain part of the increase in Finland\u2019s overall average export value. More lumber was sold into relatively expensive European channels while lower-priced overseas shipments declined. The customs average therefore improved even though mills did not gain sufficient pricing power to cover their raw-material costs across the full production mix.<\/p>\n

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Change in Finnish softwood lumber exports, January\u2013June 2026<\/div>\n
\n
Germania<\/div>\n
\n
<\/div>\n<\/div>\n
+22.0%<\/div>\n<\/div>\n
\n
Italy<\/div>\n
\n
<\/div>\n<\/div>\n
+21.3%<\/div>\n<\/div>\n
\n
Egipt<\/div>\n
\n
<\/div>\n<\/div>\n
-21.1%<\/div>\n<\/div>\n
\n
Japan<\/div>\n
\n
<\/div>\n<\/div>\n
-29.6%<\/div>\n<\/div>\n
\n
United Kingdom<\/div>\n
\n
<\/div>\n<\/div>\n
-31.9%<\/div>\n<\/div>\n
\n
China<\/div>\n
\n
<\/div>\n<\/div>\n
-34.1%<\/div>\n<\/div>\n
\n
Saudi Arabia<\/div>\n
\n
<\/div>\n<\/div>\n
-44.8%<\/div>\n<\/div>\n
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Morocco<\/div>\n
\n
<\/div>\n<\/div>\n
-61.4%<\/div>\n<\/div>\n
Source: Finnish Customs and GWMI calculations.<\/div>\n<\/div>\n

Europe should continue to provide Finland\u2019s most reliable demand during the remainder of the year, but the increase in selected destinations cannot fully replace the volumes lost in the UK, Japan, China and the Middle East. The German market is improving from a weak base, and buyers remain disciplined rather than concerned about securing supply. Italy and the Netherlands offer attractive values, but neither has the scale to absorb large quantities displaced from overseas markets.<\/p>\n

For pine producers, a recovery in Egypt and the Middle East would be more useful than another small improvement in continental Europe. Pine mills need markets capable of accepting both large volumes and a broad product mix. Without such a recovery, mills will have to choose between reducing production, accepting weaker prices for certain grades or accumulating stock. The first option is becoming increasingly likely.<\/p>\n

The industry is being concentrated, not abandoned<\/h2>\n

The company decisions announced in 2026 do not describe a simple withdrawal from Finnish sawmilling. Older capacity is being removed or reviewed while newer mills are increasing output, and foreign groups continue to acquire Finnish producers. Production is moving towards sites with higher automation, lower unit costs and access to larger international sales networks.<\/p>\n\n\n\n\n\n\n\n\n\n\n
Company\/site<\/th>\nDevelopment<\/th>\nEffect on the Finnish market<\/th>\n<\/tr>\n<\/thead>\n
Stora Enso \u2013 Veitsiluoto<\/strong><\/td>\nPermanent closure planned following the current curtailment; approximately 60 employees affected.<\/td>\nAn older mill disappears, but pine production is intended to move mainly to Oulu and Kalajoki.<\/td>\n<\/tr>\n
Stora Enso \u2013 Uimaharju<\/strong><\/td>\n13 redundancies, six temporary contracts ending and changes to 16 positions.<\/td>\nA cost and organisational restructuring, with no announced reduction in the sawmill\u2019s 240,000 m\u00b3 capacity.<\/td>\n<\/tr>\n
Veljekset Vaara<\/strong><\/td>\n11 redundancies and preparation for possible temporary layoffs.<\/td>\nShows that weak construction demand is reaching further into processed wood products.<\/td>\n<\/tr>\n
Pfeifer \u2013 Kajaani<\/strong><\/td>\nOutput capacity increased to approximately 450,000 m\u00b3 following extensive automation.<\/td>\nAdds efficient pine capacity and raises the productivity level older mills must compete against.<\/td>\n<\/tr>\n
Binderholz \u2013 Kuhmo<\/strong><\/td>\nAgreement to acquire a mill producing approximately 500,000 m\u00b3 annually, subject to competition approval.<\/td>\nPlaces a loss-making pine producer inside a much larger European manufacturing and sales network.<\/td>\n<\/tr>\n
Stora Enso \u2013 Imatra<\/strong><\/td>\nEnvironmental permit obtained for a possible 800,000 m\u00b3 sawmill; no final investment decision.<\/td>\nNo effect on 2026 supply, but potentially a major change in eastern Finland\u2019s log balance from 2028.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Veitsiluoto is the clearest removal of a production site. The mill has been temporarily curtailed and, under Stora Enso\u2019s plan, will not restart in October. Its disappearance should not, however, be counted as an equivalent reduction in the group\u2019s total Finnish production. Stora Enso intends to transfer pine sawing to Oulu and Kalajoki, where it gained substantial modern capacity through the acquisition of Junnikkala in 2025.<\/p>\n

The logic is industrial rather than defensive. Continuing production at the century-old Veitsiluoto mill would require substantial investment, while the group already has unused or expandable capacity elsewhere in northern Finland. The closure reduces fixed costs and concentrates available logs at mills where productivity is higher.<\/p>\n

Uimaharju is a different case. The negotiations covering the sawmill and the neighbouring Enocell pulp mill ended with 13 redundancies, six temporary contracts being discontinued and changes to the duties of 16 employees. Stora Enso has not announced a reduction in the sawmill\u2019s 240,000 m\u00b3 annual capacity. Treating all of these employment changes as a reduction in lumber production would therefore exaggerate their market effect.<\/p>\n

Pfeifer\u2019s rebuilt Kajaani operation shows the other side of the restructuring. Annual output capacity has risen to approximately 450,000 m\u00b3 and production has been reorganised around a highly automated line, with no forklift movement between the central processing stages. The mill is designed for the smaller-diameter pine available in northern Finland and can move a log from cutting to a dried, packaged product in less than a week.<\/p>\n

Kajaani does not create favourable market conditions for older competitors. It introduces more efficient capacity into a pine market already struggling with weaker overseas demand. Pfeifer can also sell Finnish production through an international network covering Europe, the UK, the US, Japan and the MENA region, giving it more options than an independent mill dependent on a smaller customer base.<\/p>\n

Binderholz\u2019s planned acquisition of Kuhmo follows the same pattern. Kuhmo processes more than one million m\u00b3 of sawlogs and produces around 500,000 m\u00b3 of lumber annually, approximately 80% of it pine. The company recorded a net loss of \u20ac4.5 million in 2025, its third consecutive loss-making year, but remains attractive to a well-capitalised group seeking Nordic raw material, production capacity and additional products for its existing customers.<\/p>\n

These transactions indicate that Finland is not losing its relevance as a sawmilling location. Investors continue to value the quality of Finnish logs, the country\u2019s forestry infrastructure and the reliability of its mills. What they are less willing to support is high-cost production at isolated plants without sufficient scale, downstream processing or international market reach.<\/p>\n

Financial results show which mills have room to wait<\/h2>\n

The private sawmill results for 2025 reveal a sector entering the current downturn from very different financial positions. Luvian Saha achieved an operating margin of 7.6%, Westas 4.5%, Isojoki Sawmill 4.0% and Anaika Wood 3.6%. FM Timber recorded an operating loss for a third consecutive year, while Junnikkala lost \u20ac8.8 million during the ramp-up of its new Oulu sawmill before being acquired by Stora Enso.<\/p>\n\n\n\n\n\n\n\n\n\n\n
Company<\/th>\n2025 turnover<\/th>\nOperating result<\/th>\nOperating margin<\/th>\nEquity ratio<\/th>\n<\/tr>\n<\/thead>\n
Anaika Wood<\/strong><\/td>\n\u20ac97.0 million<\/td>\n\u20ac3.5 million<\/td>\n3.6%<\/td>\n67.6%<\/td>\n<\/tr>\n
FM Timber<\/strong><\/td>\n\u20ac42.9 million<\/td>\n-\u20ac0.9 million<\/td>\n-2.0%<\/td>\n46.9%<\/td>\n<\/tr>\n
Isojoki Sawmill<\/strong><\/td>\n\u20ac58.2 million<\/td>\n\u20ac2.3 million<\/td>\n4.0%<\/td>\n73.1%<\/td>\n<\/tr>\n
Junnikkala<\/strong><\/td>\n\u20ac199.2 million<\/td>\n-\u20ac8.8 million<\/td>\n-4.4%<\/td>\n63.8%<\/td>\n<\/tr>\n
Luvian Saha<\/strong><\/td>\n\u20ac105.8 million<\/td>\n\u20ac8.0 million<\/td>\n7.6%<\/td>\n67.7%<\/td>\n<\/tr>\n
Westas<\/strong><\/td>\n\u20ac186.0 million<\/td>\n\u20ac8.3 million<\/td>\n4.5%<\/td>\n64.0%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

The stronger companies have balance sheets capable of carrying another weak year, although that does not mean they will continue producing regardless of margin. High equity ratios give mills the option to reduce output, postpone investment or wait for better orders without immediately placing the company at risk.<\/p>\n

The more vulnerable producers face a different calculation. A mill combining older machinery, a narrow product mix, high pine exposure and expensive road transport cannot easily absorb several consecutive loss-making years. If lumber demand fails to improve, Finland may see further ownership changes before it sees widespread bankruptcies. The acquisitions of P\u00f6lkky, Junnikkala and Kuhmo show that modern or strategically located assets can still find buyers even when their short-term results are poor.<\/p>\n

Finland may have enough logs nationally and still leave individual mills short<\/h2>\n

Finnish Sawmills Association chairman Matti Kyl\u00e4vainio estimates that between 2.4 million and 5.8 million m\u00b3 of log-quality wood per year have remained outside sawmill and plywood consumption during the 2020s. According to his calculation, approximately 15% of the logs harvested in Finland have been directed towards other uses.<\/p>\n

The figures challenge repeated claims of an absolute national log shortage. They do not prove that every sawmill has access to sufficient commercial raw material. National availability, mill availability and economically viable availability are three different things.<\/p>\n

A sawmill requires particular species, diameters, qualities and lengths within a transport radius that does not destroy the value of the finished lumber. Wood that is statistically available in another part of Finland, unsuitable for the required sawing pattern or too expensive to transport cannot be treated as equivalent supply. Timber sale contracts also allow buyers to optimise harvesting according to their own industrial requirements, meaning part of the theoretical log yield may remain unused.<\/p>\n

The issue is allocation rather than forest growth. Finland\u2019s forests contain more than 2.5 billion m\u00b3 of wood, and annual growth remains above harvesting and natural losses. The country has not suffered the scale of drought, fire and bark beetle damage experienced in Central Europe. Its raw-material base remains one of the strongest in the European sawmill industry.<\/p>\n

Commercial availability can nevertheless tighten locally. Harvesting restrictions in southeastern Finland have placed around 600,000 m\u00b3 of planned harvesting at risk, with potential stumpage losses estimated close to \u20ac30 million. The national volume is manageable, but restrictions around Kotka, Hamina and Pyht\u00e4\u00e4 can interrupt established procurement programmes and force individual industrial buyers to bring wood from further away.<\/p>\n

For a sawmill already operating with a narrow margin, another transport stage can be more important than the existence of a theoretical national surplus. The industry\u2019s call for a professional diesel system therefore concerns more than road hauliers. Logistics are the second-largest cost category for many Finnish sawmills after raw material, and around 80% of production must reach customers outside Finland.<\/p>\n

What traders should expect between September and December<\/h2>\n

Finnish mills will approach fourth-quarter negotiations with less interest in maximising volume than they showed during the stronger production phase of 2025. Producers will continue defending standard spruce offers because raw-material costs leave little room for broad concessions. Negotiability will depend on the exact dimension, quality, destination and the mill\u2019s need to complete a sawing programme.<\/p>\n

Pine is likely to remain more exposed. Weakness in Egypt, Saudi Arabia, Israel, China and Japan leaves mills with fewer outlets for the complete range of products generated from each log. A producer may have satisfactory orders for the main grade while struggling to place sideboards, lower grades or particular dimensions. This can restrict production even when headline demand for one product appears stable.<\/p>\n

Buyers should not assume that lower Finnish production will create shortages across standard products. Availability remains sufficient and mills need orders. At the same time, reduced shift patterns mean producers will be less willing to saw unusual specifications without firm commitments. Lead times for less common dimensions may therefore extend even while the general market remains weak.<\/p>\n

Purchasing behaviour should remain short. European importers have little reason to accumulate large inventories while construction consumption is subdued, financing remains expensive and alternative supply is available from Sweden and Central Europe. Finnish sellers have equally little reason to accept a large price reduction when the spruce log entering the mill still costs more than \u20ac80\/m\u00b3 before harvesting and transport are fully considered.<\/p>\n

The likely result is not a dramatic price collapse but a market with fewer transactions, cautious production schedules and repeated gaps between sellers\u2019 offers and buyers\u2019 targets. Some orders will be concluded only when mills need to balance their product mix or fill a vessel. Others will be postponed because neither side faces enough pressure to accept the other\u2019s price.<\/p>\n

Further temporary curtailments during autumn and around the Christmas period are likely. Permanent decisions will remain concentrated among mills where weak demand exposes a longer-standing problem: old equipment, insufficient scale, a difficult location or several consecutive years of losses. Finland does not need to remove large quantities of modern capacity, but it has less reason to preserve every existing production site.<\/p>\n

Less output will not be enough to restore profitability<\/h2>\n

Finland\u2019s sawmill industry is not entering a conventional downturn in which lower production quickly generates cheaper logs and wider margins. The adjustment is taking place through fewer timber purchases, lower utilisation, workforce reductions and the concentration of production at newer mills. Raw-material prices are reacting slowly because forest owners can postpone sales and mills still need to secure winter supplies.<\/p>\n

Softwood lumber production is likely to finish near 11.2\u201311.3 million m\u00b3, around 4% below 2025. Export volumes will decline more sharply than production, while the annual average export value may remain slightly above last year because of the greater weight of higher-priced European destinations. That will not be enough to produce a broad recovery in mill earnings.<\/p>\n

The weakest part of the market remains pine sold to overseas destinations. Spruce has better support in Europe, but even spruce mills cannot fully transfer Finnish log costs to customers while construction demand remains soft. Any improvement in profitability during the final months of the year will come primarily from tighter production control, not from a decisive increase in lumber prices.<\/p>\n

Veitsiluoto\u2019s planned closure, the changes at Uimaharju and the reductions at Veljekset Vaara show that companies are no longer waiting passively for construction to recover. Pfeifer\u2019s expansion at Kajaani, Binderholz\u2019s purchase of Kuhmo and Stora Enso\u2019s concentration of northern production show where the surviving volume is going: towards larger, automated plants operating within international groups.<\/p>\n

Finland will probably end 2026 with fewer cubic metres produced and a more concentrated industrial structure. It will not necessarily end the year with a properly balanced market. Lower sawlog prices would help, but mills ultimately need more lumber demand, particularly from European construction and the overseas pine markets that once absorbed much larger Finnish volumes. Until that demand returns, production discipline will remain the industry\u2019s main defence against another year of weak margins.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n<\/div>\n<\/div>\n<\/div>","protected":false},"excerpt":{"rendered":"

Finland\u2019s sawmill industry is approaching the final months of 2026 with a market equation that has become harder rather than easier to solve. 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