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Large Estonian sawmills expect growth in 2010

Juhan Tere, BC, Tallinn, 26.01.2010.Print version
Largest sawmills of Estonia increased production volumes last year and expect growth in orders by at least 10% this year sawn timber abroad, as LETA learned from BBN report, referring to Äripäev.reflecting.

Estonia's largest sawmills Toftan managed to get advantage from the situation on the market even in crisis times.


"For instance, we made cheap sales in North Africa and increased exports to Japan. We did not add the third shift, but increased productivity and used all opportunities in this depressed timber market," said Martin Arula, the CEO of Toftan.



According to Arula, exports made up approximately half of Toftan's sales, while the figure reached 70% last year.


"Growth came from relatively cheap export and even made a small profit," the company's CEO explained.


Estonia's sawmill industry is more competitive in comparison with the rest of Europe also because prices of round wood in Estonia changes along with sawn timber.


"For instance, the production volumes of Finnish sawmill industry are about 40% behind the real level because of the solid prices, put forward by forest owners. This is creating a gap in the market and enables our producers to increase market share and win new customers," Arula said.


One of the few sawmills that saw production volumes fall was Imavere.


Since 2008, several large sawmills have closed doors including Paikuse, a sawmill Stora Enso Eesti, and Haret and Flexa Eesti last year.


"Railway transport from Russia halted, and we mainly used Russian import round wood," explained Tarmo Reimer, the former Executive of Flexa Eesti, adding that Flexa Group had its own sawmill in Karelia and production was moved over there.


Balcas Eesti that had been stopped for ten months re-started production in one shift in September.


Price of sawn wood in summer 2007 was 1,560 kroons per cubic meter; it cost 660 kroons in spring 2009, and costs 860 kroons now.


The same applies for sawn boards that cost 3,200 kroons, 1,800 kroons and 2,250 kroons, respectively.

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