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Top: Companies have invested in their production technology and optimised processes PHOTO: VAN ROJE Above: Damage caused by storms and beetle infestation has led to a rethink on the make-up of German forests PHOTO: PIXABAY
until May 2021. After this peak, prices fell again just as quickly as they had risen before, but they have now settled at a medium level (compared to 2019/20).
Many companies in the sawmill and timber industry reacted to the strong increase in demand by expanding their production. Thanks to investments in previous years to be able to process the high volumes of damaged wood due to the drought and beetle crisis, the companies had invested in their production technology and optimised processes. Since July 2021, the opposite development has occurred: demand for sawn softwood has fallen significantly due to existing high inventories at retailers and processors. As a result, the wood processing industry had to reduce production and the prices for sawn softwood products also dropped significantly. At present, the order situation in the sawmill and timber industry has cooled down considerably and companies are rather more pessimistic about the coming months. The market is still very dynamic.
CRISIS LEADS TO RETHINK The forest damage of recent years has shaken the Germans awake: The climate-stable mixed forest should replace the large stands of softwood trees in the future. Although forest conversion has been going on for decades,
the crisis has only now become really visible: entire forests are hardly recognisable and crown thinning is also continuing. Reforestation is urgently needed without any ifs and buts. The year 2021 brought much more rain than previous years, so that the forest was able to take a rest – also the beetle population was lower. However, it is still a long way from recovery.
Set-asides or bans on use, such as the Forest Damage Compensation Act passed in spring 2021, are nevertheless a consequence of this tense development in the forest. The DeSH never tires of pointing out that timber can only develop its climate-positive effect if it is processed into durable wood products and replaces CO2
-intensive materials.
Following this logic, DeSH is committed to continuing to manage forests sustainably. But due to the long-term increase in the share of hardwood, the question arises as to how hardwood will be usable for a wide range of products in the future. Here, the association has founded a new initiative, ‘Hardwood+’, which is particularly committed to hardwood use and will also promote it more strongly.
THE BIG QUESTION MARK 2021 was also a year of major changes. In addition to the extraordinary price and demand development, which will continue to
occupy the industry in the coming years, the “Merkel era” came to an end on September 26, 2021. After 16 years as chancellor, Mrs Merkel was not available for another term. The election was then narrowly won by the Social Democrats with vice-chancellor and finance minister Olaf Scholz.
CHANGING OF THE GUARD Now Germany is very likely to get a change of government with a coalition of Social Democrats, Greens and Liberals. The parties have announced far-reaching reforms in an initial paper, many of which could also have a positive impact on the German sawmill and timber industry.
At the end of the day, the question will be what role the coalition partners will assign to wood as a raw material in overcoming the climate crisis. Exactly how the negotiations will end and what concrete points will be in the end is still open at the moment. In any case, the EU Green Deal and its subordinate programmes and regulations, such as LULUCF (Land Use, Land-Use Change and Forestry), will have a major influence on German climate protection policy. The question here will be how serious politicians are about the climate protection effect of wood. First drafts have light and shade. ■
www.ttjonline.com | January/February 2022 | TTJ
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