Log Buying Competitive Landscape
Three companies that purchase logs and/or forest in Northern Europe are Södra, DSHWood, and AB Timber. All information has been entered on the attached competitive landscape spreadsheet. The quantity bought (price) and quantity bought (volume) have been triangulated for each company. These triangulations and calculations are outlined below.
Södra purchases logs from 51,000 forest owners in southern Sweden.
According to Södra's 2017 annual report, "every year, Södra's members harvest and deliver about 9 million cubic meters of wood raw material to Södra's mills." Using the average Global Sawlog Price Index of $74.69/cubic meter, we can estimate the amount spent on logs by Södra to be $672,210,000 per year (9,000,000 x $74.69).
DSHWood buys logs from Denmark, a Scandinavian country. The company was chosen because it is one of the largest purchasers of logs in the region.
An average employee at DSHWood buys 3,000 – 4,000 logs per 8-hour day.
There are 10 "purchasers" listed on the staff page of DSHWood. Therefore, if we use 3,500 as the average number of logs purchased in an 8-hour day (3,000 + 4,000 = 7,000 / 2 = 3,500), then we can assume that the 10 purchasers buy 35,000 logs each day (3,500 x 10). Assuming there are 250 workdays in a year (excluding weekends and holidays), this means that DSHWood buys 8,750,000 (3,500 x 250) logs per year.
The average cubic meter size per log has been obtained from the Forest Products Conversion Factors guidelines, which provides the average log size in cubic meters for 15 world regions. Unfortunately, Denmark is not one of these countries, so an average of the 15 sizes has been used. The following figures from the guide were used to calculate average:
Smalian: 0.258 cubic meters
Huber: 0.254 cubic meters
Alberta, Canada: 0.256 cubic meters
British Columbia, Canada: 0.267 cubic meters
Finland: 0.299 cubic meters
France: 0.265 cubic meters
Ireland: 0.287 cubic meters
Germany: 0.244 cubic meters
Norway: 0.245 cubic meters
Russia: 0.270 cubic meters
Sweden: 0.197 cubic meters
UK Conifer: 0.228 cubic meters
UK Hardwood: 0.286 cubic meters
US NWLRAG: 0.246 cubic meters
US Forest Services: 0.250 cubic meters
Added together, these total 3.852 cubic meters. Then we divide by 15 values to get an average of 0.2568 cubic meters, rounded to 0.257 cubic meters.
Using the average cubic meter size per log of 0.257 and the average Global Sawlog Price Index of $74.69/cubic meter, we can estimate a cost for the number of logs purchased by DSHWood per year:
8,750,000 logs x 0.257 cubic meter average log size = 2,248,750 cubic meters of logs each year.
2,248,750 cubic meters x $74.69/cubic meter = $167,959,138.00
AB Timber buys logs from Sweden, a Scandinavian country and is considered a top timber wholesaler and is mentioned on numerous timber and lumber company lists, indicating it is a major player in this industry. Representatives from AB Timber are also frequently listed as speakers at industry events.
There are 165 sawmills in Sweden producing a total of 20,000 cubic meters of logs per year. This means that each sawmill averages 121 cubic meters of logs each year (20,000 / 165). AB Timber purchases logs from 80 of these suppliers. AB Timber is likely not the only company supplied by these sawmills, but with the lack of other information, we can only say that AB Timber purchases no more than 9,680 cubic meters of logs each year (121 x 80).
Using the average Global Sawlog Price Index of $74.69/cubic meter, we can estimate the amount spent on logs by AB Timber to be $722,999 per year.