Finnish holiday season dampens timber sales

The forest industry purchased one million cubic metres of wood from private forests in Finland in July. Timber sales activity was more subdued than in the livelier early summer because of the holiday season. The volume of procurements was on a par with the July average of earlier years. Demand for wood remains good in spite of the uncertain economic climate.

The aggregate January-July purchase volume, 10.8 million cubic metres, was down 10% from the corresponding period of 2010. Some 6.1 million cubic metres of pulpwood and 4.3 million cubic metres of sawlogs were purchased in January-July.

Price levels strengthened during the early part of the year and have now stabilised. Stumpage prices are above the long-term average and high in proportion to the prices fetched by the end products of the forest industry. The rising level of costs is weakening the ability of forest industry companies to compete on the global markets.
The average stumpage price of pine sawlogs was €57 per cubic metre and spruce sawlogs cost €59 per cubic metre. Birch sawlogs fetched an average of €44 per cubic metre. The average stumpage price of pine and birch pulpwood was €16–17 per cubic metre, while spruce pulpwood cost €20 per cubic metre on average.

Although the outlook for the end product markets is mostly stable, the general uncertainty regarding the economy is weakening predictability and is affecting product demand.

There is good demand for wood, as timber sales got off to a sluggish start in the early part of the year. Forest owners should take advantage of this strong demand because all timber grades are now being purchased at high prices.