Norra Skog keeps timber prices for forest owners despite losses

The Swedish forestry association Norra Skog recorded an operating loss in the first half of 2026, but retained the current terms of payment for timber for its members. The organization has decided not to transfer the effects of the weak global environment directly to forest owners through lower prices for wood raw materials.

    In January–June 2026, Norra Skog's operating result was SEK -54 million, compared with SEK- 172 million a year earlier. The result before taxes decreased from +168 million to -44 million crowns.   Revenue, adjusted for inventory changes, amounted to 3.163 billion crowns against 3.205 billion crowns a year earlier.

Why doesn't Norra Skog reduce wood prices

    Norra Skog operates as a cooperative organization of forest owners and strives to smooth out sharp fluctuations in prices for wood raw materials.

    In the first half of 2026, the market for forest products remained challenging. The financial results were affected by geopolitical conflicts, trade restrictions and weak demand in several important export markets.

    At the same time, Norra Skog deliberately preserved the terms of the deals with the forest owners. According to the management of the organization, the presence of a financial cushion allows you to take part of the market losses on yourself, without reducing the cost of wood for the members of the cooperative.

The key point is that maintaining purchase prices makes it possible to maintain the predictability of forest owners' incomes even in the face of deteriorating financial results of the processing organization.

    This approach is especially important for the roundwood market, where changes in purchase prices directly affect the economics of logging.

    ForestResource has separate sections for participants in this market: buy roundwood and sell roundwood.

Lumber remains a more stable segment

    The demand for softwood lumber in the first half of 2026 proved to be more stable than the demand for pulp, paper and cardboard.

    However, this does not mean a full-fledged market recovery. Construction activity in a number of important export countries remains weak, so the opportunities for rapid growth in demand are limited.

    Norra Skog expects that lower lumber production rates in the Nordic countries may support prices in the second half of the year. At the same time, the weak construction market in key export destinations will continue to limit the recovery in demand.

    Commercial offers for the purchase of lumber and sale of lumber are available for international market participants.

The main problem is the gap between the cost of raw materials and the prices of products.

    The situation of Norra Skog reflects the broader problem of the global forestry industry.

    Prices for raw wood in Sweden remain high in historical comparison, although they began to decline after the second half of 2025. At the same time, the cost of finished products does not always grow at the same rate.

High cost of wood 
↓ 
Limited prices for finished products 
↓ 
Reduced profitability of processing

    It was this imbalance that became one of the factors affecting the financial result of Norra Skog.

    The situation looks different for forest owners: maintaining high purchase prices supports the profitability of logging, but increases the burden on processors.

Paper, cardboard and pulp are under more pressure

    The weakest dynamics in the first half of the year was observed in the pulp, paper and cardboard segments. High prices for raw materials were combined with insufficient demand for finished products.

    This is an important difference from the lumber market. The construction sector remains weak, but the demand for softwood lumber is relatively stable. The pressure was more pronounced in the pulp and paper sector.

    For participants in international trade, both offers of paper for sale and requests for the purchase of paper are relevant.

What's going on with the Roundwood Market

    The situation of Norra Skog shows how closely the markets of forest raw materials and finished products are connected.

    If prices for lumber, paper, and other wood processing products do not allow businesses to increase margins, processors usually start looking for ways to reduce wood costs.

    However, Norra Skog has chosen a different approach in the current situation — to maintain a stable pricing model for forest owners.

For the market: this model creates a kind of buffer between the global market of finished products and owners of forest resources.

    At the same time, the organization itself recognizes that the market remains difficult and it is possible to maintain price pressure in the future.

Financial results of Norra Skog

SEK 226 million is how much Norra Skog's operating result has deteriorated over the year.

    Thus, the operating result deteriorated by 226 million SEK during the year.

Prospects of the global timber products market

    Norra Skog expects the overall market situation to remain challenging in the second half of 2026. The organization notes some positive signals, but many buyers continue to postpone major transactions due to ongoing uncertainty.

    For lumber, a reduction in production in Northern Europe may provide possible price support. However, weak construction activity in key export markets limits the possibilities for a rapid recovery.

    The situation also remains ambiguous for pulp and cardboard: there are some signs of improved demand and prices, but competition remains high, and the market is sensitive to the economic situation in Europe, North America and China.

What does Norra Skog's strategy mean for the global market?

    The decision to maintain timber prices shows one of the possible behaviors of a timber industry organization during a weak economic environment.

    Instead of immediately transferring market pressure to suppliers, Norra Skog uses its own financial resources to maintain the stability of purchase prices.

For forest owners: greater predictability of income.

For the processor: a temporary reduction in its own profitability.

    In a broader sense, the situation shows that in 2026, the global timber market remains heterogeneous: lumber shows greater resilience, while pulp, paper and cardboard face more pronounced demand pressure and high cost of raw materials.

    At the same time, Norra Skog expects market participants to remain cautious in the second half of the year, and a more noticeable turnaround in the market conditions — no earlier than 2027.

Tags: #NorraSkog #Sweden #Global Timber market #Forestry #Forest owners #Prices of wood #Raw materials #Roundwood #Lumber #Coniferous Lumber #Pulp #Paper #Cardboard #Timber Industry Complex #Timber Processing #Construction Market #Global Market #Lumber Market

Edited Moderator (Sept. 20, 2026 19:24:38)