The Holzkurier’s economic survey among sawmills in Germany and Austria shows a much more negative picture in the third quarter than three months earlier. Only 6% of the companies surveyed expect a positive development of their business situation over the next three months. 46% anticipate a poor business situation. In the second-quarter survey, 13% expected a positive development and 11% a negative one.
Looking back, the past three months were also far from encouraging: 30% of the sawmills rated their business situation as bad, 12% as good, and 58% as satisfactory. 74% of the respondents stated that their sales were satisfactory in the past quarter, while 24% reported low sales, and only 2% described their sales as high. As for the next quarter, outlook is considerably more subdued: 24% of the sawmills believe that their sales will decrease. Still, 12% expect sales to rise according to the economic survey.
Rising prices for log wood and lumber
58% of respondents expect the upward trend in log prices to continue over the next six months. Only 10% anticipate falling log prices.
The assessment is similar when it comes to lumber prices: 66% expect them to rise over the next six months. Numerous survey participants emphasize that log and lumber prices are completely decoupled at the moment.
Raw material as major issue
In recent years, the shortage of skilled workers has been repeatedly mentioned as the biggest challenge sawmills are faced with. Now, however, the log price and the insufficient supply of raw material have taken that title. Many survey participants are struggling with these issues.
For this reason, sawmills plan, among other things, to expand their purchasing area and adjust production. This is accompanied by the comparatively low price for lumber and too weak demand.
Biggest challenges at the moment
Answers to the question: What are the biggest challenges your company is currently faced with and how do you handle them?
- Fire insurance
- Staff turnover; sales prices of packaging products difficult to raise
- High log prices and insufficient log supply; we are paying the required prices to obtain log wood and are trying to expand our purchasing radius; overall, very unsatisfactory and worrying
- Skilled labor shortage → increase incentives and recruitment efforts
- Rising log prices with virtually unchanged lumber prices; log prices are currently completely decoupled from lumber prices
- Logistics, staff
- Weak demand
- Raw material supply, energy costs, skilled workers
- Log supply is currently very difficult and will remain so for the next two quarters. The stupidity of some market participants doesn’t seem to know boundaries! There are no discounts anymore, and standard deductions for low-quality wood, etc., are no longer being granted! Contracts are also being renegotiated and amended mid-term. Of course, this creates uncertainty among forest owners, who are waiting to see what other foolishness will occur.
- Selling construction timber
- Log procurement and price increases
- High log prices and energy costs
- Limited choice in log purchasing
- General “paralysis”, presumably mostly because of the war in Ukraine. We are adjusting our production to weak demand; 2. The cost situation in Austria is extremely problematic: labor, energy, and transport costs, … – and taxes. How do we deal with that? Well… solutions are nowhere in sight.
- Log shortage
- Rising log costs
- Preventing log exports
- Procurement and supply of log wood; purchasing area will be significantly expanded
- Finished single-use pallets in the automotive industry – poor overall economic situation
- The excessively high log prices can’t be offset through lumber prices. At the same time, log supply is very poor.
- Costs too high, labor shortage
- Log and lumber prices have become decoupled, high energy and personnel costs
- Shortage of log wood; lower production volumes
- Demand
- Log prices too high compared to lumber prices
- Low demand; adjustment of production to sales situation
- Log shortage
