"We believe in our sawmills because they are important for our members and the profitability of their forest estates. For this reason, we are now investing in the future and making extensive structural changes to improve profitability. We will also be looking at possibilities for increased timber housing construction, where we already have a solid foundation with our now well-managed and profitable subsidiary Trivselhus," says Lars Idermark, President and CEO of Södra.
Investments are being planned for the sawmills in Långasjö, Värö and Orrefors in Sweden. The largest investment will be made in Långasjö, where the production volume will increase from 280,000 to 360,000 cubic metres. At the same time, a decision has been made to initiate trade union negotiations due to closures of the sawmills at Ramkvilla and Torsås, and production cuts at Mönsterås and Värö. Overall, annual production capacity will be reduced by approximately 200,000 cubic metres.
In total, approximately 150 employees will be affected by the restructuring, but new opportunities will also open at the facilities that are increasing their capacity. The increased output will create a need for approximately 50 positions, mainly in Långasjö and Trivselhus. Södra's smallest sawmill, Djursdala, which processes hardwood, is currently undergoing divestment.
"Unfortunately, many employees will have to leave Södra, and we are doing everything we can to act responsibly and offer career transition and relocation support. But on behalf of our owners, it is our job is to ensure a solid base for the future and make Södra Wood profitable in order to promote the profitability of their forest estates," says Jörgen Lindquist, President of the Södra Wood business area.
In recent years, Södra has worked intensively to increase the profitability of its sawmill and planing operations. In autumn 2015, a decision was made to close the hardwood sawmill at Traryd and in January, the Norwegian sawmill in Hauerseter was divested. In April, the sales organisation was strengthened when Södra acquired the remaining shares in UK company Crown Timber, which owned the Finnish sawmill in Hamina, among other operations.
"On the basis of Södra's Group strategy, we have reviewed our entire sawmill structure and examined the need for long-term measures at each sawmill in terms of market, logistics, production costs and investment requirements. We have decided on this rational structure to improve logistics and raw material flows, and we will continue to streamline our operations in order to secure Södra's future competitiveness," says Jörgen Lindquist.
In 2015, Södra Wood generated sales of approximately SEK 5.7 billion and had 1,500 employees. The sawn volume was approximately 2 million cubic metres.