Warm winters are a threat for the timber industry in Scandinavia - Finance and Markets

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Forest soils beneath the northern polar circle are usually heavily frozen at this time of year, becoming strong enough to withstand the huge timber extraction machines. However, this is changing, according to the authorities in Finland and Sweden. The unusually mild winters turned the soil into a dense layer of mud capable of swallowing a 25-tonne machine, used to collect material, which subsequently turns into pulp, paper and packaging.
Temperatures in many places in Sweden were up to 3 degrees Celsius higher than normal for December and January, according to data from the Swedish Meteorological and Hydrological Institute. This warming is part of a trend that is likely to hold on, officials said, expecting the degrees to continue to rise over the next six decades, pushed up by global warming.
The difficulties, which the businesses in Scandinavian forests is facing, highlight the impact of the climate change. Although warming opens up new waterways and routes for exploring natural resources, the countries and companies in the region are forced to resort to different ways of doing their traditional business.
For Swedish and Finnish companies such as BillerudKorsanas, Holmen AB, Stora Enso Oyj and UPM-Kymmene Oyj, the climate change is a major challenge as if the ground does not freeze enough to withstand heavy machinery, the companies can not reach the timber and need to move their business. Also, the high water levels after wet and soft autumn and winter create a difficult situation for timber supply.
And this is particularly important for the local economies. Forestry products have for centuries been a pillar of the Swedish and Finnish economies. The exports of such goods represent 10% of all Swedish exports for the past year and 22% of Finland’s exports in 2016.
“The main reason for the scarcity of wood for pulp is the unusually humid and soft winter”, said BillerudKorsnas in January. The company, which receives 75% of its raw material from the Swedish forests, warned that higher temperatures led to a shortage of raw materials at the end of 2017 and early 2018 and a negative impact on first-quarter earnings.
The company has begun to scan forest with lasers and draw maps of the more sensitive areas in an attempt to find more stable routes. BillerudKorsnas is also starting to use larger tires as well as special rubber tracks for some machines in an attempt to limit damage to soil and forest growth – another problem that comes from softer times.