Bergs Timber, a prominent timber company, has recently made the decision to shut down its subsidiary Laesti’s sawmill in Estonia. This move comes as a result of weak profitability, high production costs, and the need for significant future investments. In order to determine the best course of action for the unit’s future, a thorough strategic review was conducted throughout the spring. This review involved evaluating various options and assessing the unit’s production costs, raw material supply, market potential, and investment needs.
Situated just 3 km away from the E67 Pärnu-Tallinn highway, the Laesti sawmill is responsible for the production of approximately 80,000 m3 of pine and spruce lumber. However, despite its output, the sawmill has been facing numerous challenges that have impacted its profitability. These challenges include the high costs of production and the need for substantial investments to ensure continued operations.
The strategic review carried out by Bergs Timber aimed to gain a comprehensive understanding of the unit’s current circumstances and determine the most viable path forward. By carefully assessing factors such as production costs, raw material supply, market potential, and investment requirements, the company sought to make an informed decision regarding the sawmill’s future.
The closure of the Laesti sawmill marks a significant development for Bergs Timber and its operations in Estonia. The decision to shut down the sawmill was not taken lightly, as the company recognized the impact it would have on the local community and its employees. However, after careful consideration, it was determined that the challenges facing the unit were too significant to overcome, making closure the most viable option.
The closure of the sawmill is expected to have a notable effect on the local economy, as it will result in job losses and a decrease in timber production. This will undoubtedly be a difficult time for the affected employees and their families, as they navigate the challenges of finding alternative employment opportunities in the region.
Bergs Timber is committed to supporting its employees during this transition period, providing them with necessary assistance and resources to help them find new employment opportunities. The company will also work closely with local authorities and organizations to explore potential solutions that could mitigate the impact of the sawmill’s closure on the community.
While the closure of the Laesti sawmill is undoubtedly a setback for Bergs Timber, the company remains dedicated to its overall growth and success. As part of its long-term strategy, Bergs Timber will continue to assess and optimize its operations to ensure sustainable profitability and competitiveness in the timber industry.
The decision to close the sawmill in Estonia was a difficult one, but it was ultimately made in the best interest of the company and its stakeholders. Bergs Timber remains committed to its mission of delivering high-quality timber products while navigating the ever-evolving market dynamics.
As the company moves forward, it will draw on its extensive experience and expertise to identify new opportunities for growth and expansion. By adapting to market trends and leveraging its strengths, Bergs Timber aims to maintain its position as a leading player in the timber industry, both in Estonia and beyond.