“We must always think about how to work more efficiently. And the only goal for this is to stay in the market and be able to pay a competitive salary. If we continue to do everything as we did before, as we are used to, then we will quickly be outcompeted,” says Kristaps Klauss, Executive Director of the Latvian Forest Industry Federation, about current events in the forestry sector.

The timber market is currently very slow. Why?

Timber prices have fallen compared to 2018. One of the most significant reasons is that overproduction has occurred. For example, in the softwood timber market, this has been caused by windthrow and the subsequent mass outbreak of bark beetles in spruce forests in Germany and the Czech Republic. They are feeling this problem so acutely there that even the concerns about Brexit have been pushed into the background. Now, in an effort to salvage what can be saved, these forests are being intensively harvested, which leads to a saturation of the sawlog market in that region. Thus, German sawmills have access to significantly cheaper raw materials than those in the Baltic states. Large areas in southern Sweden have also been affected by the bark beetle invasion, and these competitors are also helped by the weakness of the krona, which is why it is not easy for Latvian softwood product manufacturers to maintain their market position at the moment.