Wood costs for the pulp industry in Europe were generally lower in the 1Q/17 than in the previous quarter, continuing a downward trend that, depending on the country, has lasted for 4-6 years. The biggest price declines for pulplogs and sawmill residues in early 2017 occurred in Germany and France, according to the Wood Resource Quarterly (WRQ). The price reductions occurred mainly because of an oversupply of pulplogs, unchanged demand for wood fiber from the pulp industry, and reduced usage of raw-material by the competing wood pellet sector. In neighboring Austria, conifer pulplog prices have been very stable during most of 2015 and 2016 (in Euro terms) and prices did not change much in the 1Q/17. However, the weakening of the Euro against the US dollar has resulted in Austrian pulplog prices falling seven percent in two years. In the Nordic countries, wood fiber costs in the 1Q/17 were at their lowest levels since 2006 (in US dollars). This was mostly thanks to the weakening of the local currencies in both Sweden and Finland. The wood fiber costs currently account for about 60% of the manufacturing cost when manufacturing pulp in the region, according to Fisher International, so a reduction in prices for pulplogs and wood chips has a major impact in improving the competitiveness of the pulp and paper industry when competing in the global market place. Click Read More below for additional detail.

White-collar workers in Finland’s paper industry on Tuesday threatened to go on strike later this month in a dispute with employers over a new wage deal. About 3,000 clerical workers are due to begin a week-long strike on Jan. 17, trade union Pro said, adding that a refusal to work overtime is due to start already on Tuesday. The paper industry, including companies such as UPM (UPM.HE), Stora Enso (STERV.HE) and Metsa Group, accounted for 22 percent of all Finnish exports in 2016.

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