Södra is committed to enhancing conditions for family forestry and improving its member offerings. As of October 21, they have raised prices for saw logs and small-diameter sawable timber, while also introducing a new tool aimed at increasing security for forest owners. Additionally, Södra is taking significant steps to boost transparency in the wood market.
To enhance security for family forestry and elevate service levels in a raw material market facing continued high demand and unprecedented fluctuations, Södra is launching initiatives to strengthen the profitability and conditions of forest estates, both in the short and long term. Over the past year, efforts to refine business models and improve market conditions have intensified. Alongside a price increase for saw logs, Södra is introducing a new tool designed to improve transparency in the raw material market and provide greater security for its members.
“Over the past year, Södra has stepped up efforts to develop business relationships with members, while the mills’ focus on using every wood fibre is continuing with the same intensity. We are doing so to strengthen the position of forest owners in a situation where we see long-term demand for raw material from family forestry as more and more players want to use forests for various purposes. At the same time, we are taking action with a price adjustment in a market with a raw material shortage and global uncertainty, which means that the situation could change rapidly,” said Peter Karlsson, President of the Södra Skog business area.
New pricing terms are increasing security when signing contracts
It is important that forest owners can feel secure when signing agreements. Södra has therefore introduced Highest price 60 days, which means that forest owners will receive the new higher price should the price be raised within 60 days of signing the agreement. The terms apply to harvesting assignments, including the log price and delivery wood. The ranges covered are standard saw logs, small-diameter ranges of spruce and pine, and softwood and hardwood pulpwood.
While maintaining a high level of service is crucial, there are times when priorities must be adjusted, leading to delays in harvesting operations. To address this, Södra is introducing a price compensation clause for delayed harvesting. This ensures that if harvesting has not begun within one year of signing the agreement, the current wood price at the 12-month mark will apply, provided it is higher than the original agreement price. These terms cover harvesting assignments, including the log price, and apply to standard saw logs, small-diameter spruce and pine, as well as softwood and hardwood pulpwood.
“We are operating in a market and in a global situation where everything is moving very fast, and this is creating uncertainty for forest owners. It’s important for us, and something that is in clear demand, that we take steps to increase security in transactions between forest owners and Södra,” said Peter Karlsson.
Södra already publishes wood price lists openly on sodra.com together with price statistics, showing current price levels and how much premium has been added to signed agreements for regeneration harvesting. The current premium levels and regulations are also available on each member’s page in Min Skogsgård (My Forest Estate). Södra is now taking a further step and in November, a price calculation tool will be launched. The tool enables members to calculate a wood price per range on their own by setting various parameters such as volume, availability and nature conservation set-asides.
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