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Södra invests SEK 200 million in sawmill expansion and upgrades

Södra is investing around SEK 200 million (≈ EUR 21.09 million) in selected sawmill operations in a bid to increase production and profitability. The investment programme will be completed during the third quarter 2017.

Södra is investing SEK 100 million to increase production at its Långsajö sawmill (photo courtesy Södra).

Södra is investing SEK 100 million to increase production at its Långsajö sawmill (photo courtesy Södra).

Swedish forest owners association Södra has revealed details of a major restructuring programme designed to increase the profitability of its sawmill operations by optimising the flows of raw materials to customers and reviewing the sawmill structure. The restructuring programme, which was presented in June last year, includes a SEK 200 million (≈ EUR 21.09 million) investment package at selected sawmills.

About half of the package, around SEK 100 million (≈ EUR 10.54 million) will be invested in the Långasjö sawmill to ramp up annual production volume, from 280 000 to 360,000 m³ sawn goods.

– To achieve this, we will replace the old small-dimension timber saw line with a new profiling curve sawing line, and thereby simplify and streamline throughput at the saw. In addition, we will build a new stacker and binding stick stacker and also install a completely new wood dryer. We will also construct a new 8 000 m2 warehouse. The project includes relocating distribution to the Swedish building trade from our Torsås sawmill, which will be closed after the summer. The projects in Långasjö started in November and are scheduled to be complete this autumn, said Jörgen Lindquist, Business Area President for Södra Wood.

The investment also means 25 new jobs in Långasjö. Employees at the Torsås sawmill have been able to apply for these jobs as they are within commuting distance. In total, 15 employees will move from the Torsås sawmill.

At Södra’s largest sawmill in Värö, a total of SEK 80 million (≈ EUR 8.44 million) is being invested into several production streamlining actions in a bid to improve profitability.

– We are working intensively at the Värö sawmill, as well as every other Södra sawmill, with Lean principles so that staff, with all their expertise, can operate the sawmill machines as safely and efficiently as possible, said Lindquist.

At its small-dimension timber sawmill in Orrefors, Södra is investing about SEK 30 million (≈ EUR 3.6 million) in a new boiler and drying facility, which will enable production increases in the future.

– The investment is necessary for profitability. Currently, there is insufficient boiler capacity, which means we must sell some goods undried. The investment will enable us to increase production and also dry the entire sawn volume, said Jörgen Lindquist.

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