The debt crisis in Europe may be protracted and have major consequences for the Swedish forest industry. Forestry must complement its timber business with many new activities. Meet Göran Persson in a conversation about the forest industry.
How do you view the development opportunities for the Swedish forest industry?
“We are in a period of structural adjustment of the European economy. This will affect the markets Sweden addresses with its paper, pulp and sawmill products.”
What will be the effect on demand for wood raw material?
“I believe we may be facing a fairly dismal development. When demand from Swedish industry decreases, prices will fall. At the same time, we have enormous volumes of forests which are approaching final felling maturity. This may very well result in a dramatic situation for forestry – increasing volumes of wood raw material, reduced demand and international unease.”
Should forest owners reduce timber prices to save the wood products industry?
“Price is dictated by supply and demand. It is a completely illogical market if the supplier of goods is the one who reduces the price when demand still exists.”
What potential do you see in biofuel business?
“The Swedish bio energy business is mature. In order to develop this business we must go out into the world. There are major opportunities for expansion. This will require completely different logistic solutions and new ways to concentrate the energy that exists in wood.
“We must utilise this energy through torrefaction, pyrolysis and other technologies. It is also possible to compost cellulose and generate a biogas which we can then compress and liquefy.”
What role will Sveaskog play in this development?
“We will develop Sveaskog’s energy business, develop technology and logistics, try to find good projects and take risks in order to be at the leading edge. This is part of our assignment.
How significant might the new revenue flows become?
“We have both the biofuel business and the undeveloped business which devolves from carbon dioxide sequestration and other ecosystem services such as biological water purification. We also have the outdoor pursuits, hunting and fishing. There is a long list of activities that forest people previously regarded as a burden which might very well account for 10, 20 and 30 per cent of our future revenues – without encroaching on our basic timber business for which we use the fibre today.”
What is the most important issue for the global forest and wood products industry?
“Climate change – not just for the forest industry but for society as a whole. Here the forest will play a decisive role.”
What can Sweden contribute when it comes to sustainable forestry?
“We can show that it is possible to manage the forest sustainably and that this also is profitable. We are skilled at forestry and can export our expertise. What is happening internationally is that a growing number of consumers are starting to ask: ‘where does that plank come from?’.”
This article is a short version of a longer interview in Swedish with Göran Persson published in our company magazine nr 1 2012.