84% of forest owners who participated in the survey expect log prices to rise in the second half year. 13% think that prices will remain constant and only 2% expect them to fall. Overall, the forestry sector seems to be as optimistic as it was in the first quarter.
According to the motto “It can only get better”, the log price had reached a low in mid-2020. In light of the price increase that followed, one third of the forestry companies described their second quarter business situation as good. Thus, compared to the first quarter, twice as many companies gave a positive assessment.
55% of respondents were already satisfied and only 13% described their business situation as bad. One quarter ago, as many as 40% had a “bad” business situation. Now, one in two forestry companies expects a positive development of their business situation and another 45% think that it will be satisfactory at least.
77% of the forestry companies expect a further growth in sales. 20% think that they will remain constant and 2% expect sales to fall in the second half year of 2021.
The biggest challenges at the moment *
“Transport of pulp wood from forests, fewer delivery tickets compared to the transport of other types of logs!”
“Finding wood harvesting companies with small cable cranes for work – it’s a constant search …”
“Industrial log sales; building storage places”
“The lower willingness to pay of sawmills, intransparent pricing, unclear forest protection situation and, as a result, uncertainty on timber markets”
“Storm damages caused by local thunderstorms and the need to create roads to remove the damaged wood, partly also expensive debarking in areas which are difficult to reach. Summer storms are getting more intense due to the effects of climate change. In our region, the annual average temperature has increased by 2°C (!) within 30 years, according to the ZAMG measuring station.”
“Drought affecting beeches, traffic safety along roads, low price for wood fuel”
“The risk of beetle infestation – booking forest entrepreneurs early”
“Applications for forest subsidies”
“Uncertainty about the development of log prices, long-term contracts not possible”
“Low prices on the industrial wood market! No long-term thinking in the pulp and paper industry! Prices hardly fetch a positive DB 1! I’m already waiting for the next mobilization!”
“I’m worried that bark-beetle calamities might disrupt the positive market situation. As a result, all sorts of prevention are the top priority.”
“Bark beetles. The unconditional clean forest management, especially a very fast processing of damaged wood, the quick transport of wood out of the forests and, as a last resort, also spraying the wood. In short, using all legal means.”
“Losses suffered in the past two years as a result of unfair pricing policies of the sawmill industry. The sawmill industry has grown on the back of the forestry sector!”
“Supplying sufficient volumes of log wood to regular customers”
“Massive calamities!”
“Lack of forest workers. Search on all levels, domestic and foreign”
“Industrial wood prices are insufficient for forestry in the mountains. Unfortunately, the forestry sector cannot change this.”
“It’s impossible to get forest workers. We have been considering to raise wages (which are already a lot higher than the ones in the collective agreement). It will be a challenge if the log price falls below the critical level.”
* Collection of anonymous statements made during the economic survey among Central European forestry companies
