| Södra to Close its Hardwood Sawmill |
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Stockholm, Sweden 20 September 2016 -- Södra is implementing structural changes in its hardwood sawmills to strengthen the long-term competitiveness of its sawmill operations. Negotiations with trade unions will be initiated with the intention of closing the hardwood sawmill in Djursdala with its 15 employees.
"We have already announced that we are reviewing our hardwood sawing operations. A decision was made last autumn to close the hardwood sawmill in Traryd," said Jörgen Lindquist, Business Area President.
Södra acquired the hardwood sawmill in Djursdala in 2009 and it is one of Södra's smallest sawmills with annual production of 15,000 cubic metres of oak and birch timber.
"Djursdala has been running at a loss for some time now and requires major investments if production is to continue. The sawmill was put up for sale but we have not received any offers to continue the operations on site," said Jörgen Lindquist.
"We have not achieved profitability despite extensive efforts. A long-term profitable sawmill operation is an essential part of the assignment from the owners to create profitability for forest estates. Against this background, we have now decided to initiate negotiations regarding an immediate closure of the sawmill," said Jörgen Lindquist.
With the closure of Djursdala, Södra will no longer have any hardwood sawing operations. Södra will seek other alternatives to find markets for its members' hardwood products.
"We will redirect volumes to external customers and thus find markets for our members' hardwood products at market-based prices, enabling us to maintain a high level of ambition in our hardwood forest management activities," said Håkan Larsson, President of the Södra Skog business area.
In recent years, Södra has worked intensively to increase the profitability of its sawmill business by optimising the flows of raw materials to customers and reviewing the sawmill structure. In the autumn, a decision was made to close the hardwood sawmill at Traryd and in January, the Norwegian sawmill in Hauerseter was divested. The sales organisation was strengthened in April when Södra acquired the remaining shares in the UK company Crown Timber, which owned the Finnish sawmill in Hamina. A decision was made prior to the summer to initiate negotiations regarding the closures of the softwood sawmills in Ramkvilla and Torsås.
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