Vapo Timber Is The Latest Nordic Sawmiller to Announce Production Cutbacks

Vapo Timber is the latest Nordic sawmiller to announce production cutbacks. The company, which has just reported a loss of € 4.2m, said the cutbacks were due to the significant overcapacity in Europe which has led to a collapse in profitability. Production cutbacks will begin on November 7 at the Kevatniemi and Nurmes sawmills in North Karelia, with shifts going from two to one. All of the company's sawmills will cease production from December 23-30. Around one month's production – 50, 000m³– will be cut in total. Hankasalmi sawmill will not be cutting its shifts because the new sawing line is still being started up. Vapo is also launching co-operation negotiations with all employees in preparation for possible lay-offs and production cutbacks at all sawmills in the first half of next year. "In the first nine months of last year we produced 4% less sawn timber than in the same period this year, but operating profit was almost ?m, " said Vapo Timber managing director Juha Hakala. "This time, on higher production, the operating loss was over?m. Construction of single family homes in Finland has dropped by a third and export demand has suffered from the general economic crisis in Europe and the instability in the Middle East and northern Africa, which are important export destinations for Vapo. " Source: ttjonline.com