FOREWORD: How to secure stability in times of scarcity
Södra’s business model is rooted in the rich history of its Swedish forest owners, but our customer base and our concerns are global. One end of our value chain is planted firmly in the forests of southern Sweden and their surroundings. Our raw material, our members, our operations and head office are all based here. But our supply chain is international and highly reliant on the flow of goods and services trading freely across continents. If disruption does arrive in the form of new trade tariffs, it will be important to remain responsive, flexible and communicative. Let’s hope it doesn’t happen.
We have been dealing with a different disruptor of the value chain in recent months - a very tight wood market, driven by increased demand for a limited supply of wood.
We need to work hard to ensure that we support members as best we can so that we can guarantee a secure supply of consistent pulp. We’ve taken several steps over the past year to do just that.
Our Forestry division, Södra Skog, has been completely restructured to optimise the way we serve our members, from support and advice to the execution of harvesting services, for example, and production flows and digitalisation.
For some of our members, their relationship with their forest is changing. It’s hardly surprising when some families have owned their estates for six, seven or more generations. Owners may no longer live on their estate or wish to farm it themselves. With this in mind, we now offer them a choice of contracts, with or without managed five-year service contracts. The idea is to build long-term, strong partnerships for the future which are in all our interests.
We are also taking steps to help our members strengthen the profitability of their forest estates and their conditions, both long and short-term.
In this newsletter, we update you on the progress of our new lignin plant, which will be the biggest of its kind in the world. Why does this matter to you? Aside from playing our role in the Green Transition, major investments such as this help ensure that we extract maximum value from every tree we process. This matters, because financially security and strong partnership with our members ensures we get the raw material we need to guarantee a secure supply of your raw material, regardless of market conditions.
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