UPM’s CEO predicts ongoing reduction in capacity

"Scarcity of Raw Wood Poses Growing Challenges for Forest Companies; Production Shutdowns Likely in the Future, Says UPM CEO"

The scarcity of raw wood is becoming an increasingly pressing issue for forest companies, impacting their plans and operations. UPM’s CEO, Jussi Pesonen, has stated that temporary and permanent shutdowns of production facilities may be necessary in the future, a trend that has already been observed in Finland. Alongside challenges in the final product market, the reduced availability of raw wood and rising prices are causing significant problems. Pesonen further highlights that capacity constraints are affecting wood products, pulp, paper, and cardboard.

Pesonen emphasizes the need to carefully manage each product group in response to these challenges. He acknowledges that adjustments will undoubtedly have to be made, as the scarcity of raw wood continues to impact the industry. These adjustments may include limiting capacity and finding alternative solutions to mitigate the effects of the reduced availability of raw materials.

The scarcity of raw wood has been attributed to various factors. One significant factor is the increase in demand for wood products, driven by construction activities and the growing popularity of timber-based solutions. This surge in demand has put pressure on the supply chain, resulting in limited availability and higher prices.

Furthermore, climate change and extreme weather events have had a detrimental impact on forests, affecting their growth and overall health. Prolonged droughts, wildfires, and pest infestations have all contributed to the reduction in the available raw wood supply. These environmental challenges have exacerbated an already strained situation, making it even more imperative for forest companies to adapt and find sustainable solutions.

In response to the scarcity of raw wood, forest companies have begun exploring alternative materials and production methods. One such approach involves utilizing wood waste and residues, which would otherwise be discarded, to create innovative products. By maximizing the use of available resources, companies can minimize waste and ensure a more efficient use of raw materials.

Additionally, forest companies are investing in research and development to find ways to optimize the use of raw wood and improve the overall sustainability of their operations. This includes exploring advanced technologies and techniques that can enhance the yield and quality of wood products.

The government also plays a crucial role in addressing the challenges faced by the forest industry. By implementing supportive policies and regulations, they can create an environment that encourages sustainable forest management and ensures the long-term availability of raw wood. This includes incentivizing responsible forestry practices, promoting reforestation efforts, and providing financial support for innovation and adaptation within the industry.

In conclusion, the scarcity of raw wood is a pressing issue for forest companies in Ireland and beyond. The challenges posed by reduced availability and increased prices necessitate careful management and adaptation within the industry. By exploring alternative materials, investing in research and development, and implementing supportive government policies, forest companies can navigate these challenges and ensure the sustainability of their operations in the long run.

John O Mahony

John O Mahony

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