Log trade in the Baltic Sea region has declined for two reasons, according to Wood Resources International: Russia’s invasion of Ukraine, and as a result of investments in forest production capacity in the Baltic States.
The two largest log-trading regions in Europe are central Europe where Austria, Czech Republic, and Germany are the major importers, and northern Europe, with Finland and Sweden being the two log-importing countries.
The most significant change in trade flow in Europe over the past few years has been the dramatic decline in log imports to the Nordic countries from Russia since the country invaded Ukraine in early 2022.
Wood Resources International further reported that the total log import volume to Finland and Sweden was just over 8 million m3 last year compared to an average of almost 16 million m3 annually throughout the previous decade.
In addition to the halt in log imports from Russia, there has also been a substantial decline in log exports from Estonia, Latvia, and Lithuania to the Nordic countries.
Most of the reduction has been in softwood logs, while hardwood log shipments have been relatively stable, fluctuating between 3-4 million m3 annually.
Softwood log trade in the Baltic Sea region has declined steadily for the past five years. In the Q3 of 2018, the total softwood log imports to Finland and Sweden reached a 15-year peak at 2.5 million m3 for the quarter and have since trended downward to just over 1 million
m3 in the Q1 2023 (see Table 1).
Over the past year, trade flows to Sweden from neighbouring Finland and Norway declined the most, shipments from Sweden to Finland and from Latvia to Sweden showed slight increases.
The tighter supply of pulp logs and strong pulp markets has pushed log prices upward over the past year. In Q1 2023, year-on-year import prices for softwood and hardwood pulp log to Finland jumped 93% and 123%, respectively.
Prices for imported softwood and hardwood pulp logs to Sweden were up 14% and 111%, respectively, during the same period. Pulp log import prices to Finland and Sweden were substantially higher than domestic prices in Q1 2023, as reported in the new WoodMarket Price digital platform from ResourceWise.
Source: Wood Resources International