Wood industry: massive decline in production in 2023

2023-09-15 20:26:00

On the occasion of International Wood Day on September 15th, representatives of the Austrian wood industry expressed concern at a press conference in Pörtschach on Friday. A lack of orders from the construction industry while production costs remain high would have a negative impact on the margin situation. They also appealed to politicians to take countermeasures, for example by investing in housing.

While there was still a good market situation in the domestic wood industry in the first half of 2022 – due to high demand – the situation changed completely from mid-2022. Markus Schmölzer, chairman of the Austrian sawmill industry, attributed the massive decline in production to a lack of orders from the construction industry. Franz Mühlbauer, chairman of the Austrian timber trade, also cited the decline in construction activity as the reason for the negative development. The situation abroad is also difficult – Italy and Germany, the most important markets for Austria, in particular, are ordering less. Exports of softwood lumber fell by 13 percent this year.

Apelle an die Politik

The representatives of the sawmill and timber trade appealed to politicians and called for investments in energy-efficient and affordable housing with new construction, renovation and densification. The annual renovation rate in Austria would stagnate at 1.5 percent and the political goal of three percent has not been achieved for years. Schmölzer called for measures such as adapted funding, easier access to building financing or understandable advice for homeowners. He also pointed out that wood is a climate-friendly building material. “Building with wood also helps against soil sealing, because wood is light and can therefore be added to existing buildings,” says Schmölzer.

Mühlbauer also called for the reduction and avoidance of bureaucracy. Specifically, he referred to the recently introduced EU Deforestation Regulation – EUDR for short. “With the new rules from Brussels, there is a real bureaucratic monster in front of our factory gates and offices,” said Mühlbauer. “If Commission President Ursula von der Leyen promises a 25 percent reduction in bureaucracy, as she did in April, then she is very close to her goal if the EUDR is stopped straight away,” he added. And: “Especially in times of crisis, entrepreneurs need to concentrate on their core business and not have to deal with bureaucracy!”

Highly important for the economy

Christoph Schneider, managing director of the Economica Institute for Economic Research, spoke of the wood industry’s great importance for the Austrian economy: “If you add up all the effects of the forestry and wood industry value chain, that amounts to eleven billion euros in gross value added,” said Schneider. Every 13th euro of added value would be generated in the forestry and wood industry. “In addition, there are around 320,000 jobs along the entire value chain and generated tax revenue of around twelve billion euros annually,” emphasizes Schneider.

Finally, Schmölzer referred to the “long-term success story” of the wood. This is still intact, but urgently requires action from politicians. “Wood is a renewable raw material that will continue to be of great importance in the future. It is now up to politicians to take the right measures so that the value creation of wood is not damaged and Austria as a business location is strengthened in the long term.”