Germany's softwood sawmill production capacity could fall by up to 30pc over the next decade, owing to a decline in raw material availability with the damaged wood from the bark beetle infestation subsiding, Austrian wood panel producer Egger's head of technology Paul Lingemann said at a recent industry event.
The development will be similar to what happened to the Canadian sawmill industry, Lingemann said.
Canada's sawmill industry started to decline in 2013-14 following 15 years of strong growth. The industry profited from a large oversupply of wood owing to the beetle-infested timber, but once this supply started to dry up, the industry went into decline, Lingemann added.
Germany's sawmill industry recorded its fourth consecutive year of operating at full capacity, with demand for timber continuing to exceed supply, Lingemann said.
German wood pellet production hit a record high in 2020, boosted by the increase in raw material availability, domestic demand and production capacity. Germany produced 3.1mn t of wood pellets last year, up by 9.9pc from 2.82mn t in 2019, data from German biomass association DEPV show.
Unexpected growth
The growth has been much higher than many in the wood processing industry expected in 2018 or 2019, Lingemann said.
This strong demand can be attributed to the "boom" in the construction sector, and to strong demand from China and the US. The "massive" demand for softwood — specifically pinewood, Douglas fir, and larch wood — has soaked up the additional timber volumes, he said.
Another challenge is the logistics issue — procurement ranges are widening and more wood is being transported by rail, and more companies are moving closer to the wood supplies, or pooling their purchasing activities, Lingemann said. He cited the example of paper group Mondi, which earlier in the month announced it will set up an eastern Europe procurement company.
Another challenge is staff shortage, which can limit the growth of the industry, Lingemann said. Some sawmills were heard to be resorting to robots to alleviate the situation.
