The world´s timber markets are going through a lot of changes. Olavi Räsänen Oy´s Kieppi Sawmill is exporting more pine timber from Mäntyharju to Northern Africa and the Middle East than ever before. The carpentry industry in Northern Africa and the Middle East uses pine for making doors, window frames and furniture for interior decoration.
The Kieppi Sawmill delivers pine timber especially to Tunis, Marocco, Algeria, Libya, Egypt, Israel and Saudi-Arabia and of courde to the European and domestic markets. New customers have also been found from Jordan, Yemen and Sudan.
Olli Turunen started working as the sawmill director in 1994. Back then exports already had an important role as the market situation was fluctuating.
"Up untill 1994, we had been using many Finnish agents but then we started developing direct customer contacts in Europe."
Finnish companies were also starting to take market share in the Arabic countries of Northern Africa that had traditionally belonged to Russia.
“In the 70’s, Russia´s credibility was under criticism in that region and so Finland became the shopping trip destination. Today this is an extremely global business and your location doesn't matter.”
At the moment, Russia is interested in the Chinese market as logs can be transported directly from Siberia.
“Now that the Russians are focusing on China and Japan, the European markets have become more the responsibility of Finland and Sweden. It is also a question of whether Canada is profiting from its exports to the United States. If the market there is at a low point, the Canadians start exporting to Europe, the Middle East and Northern Africa.”
Turunen is an expert in international business and he is used to traveling. He finds dealing with Africans and Arabs rewarding. There are always local agents present at the business negotiations, either from the country we are exporting to or from a neighboring country and the business is often done in local languages.
“Once you have gained their trust business should survive in for the long term. However it is not necessarily easy to gain their trust.”
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Hard work for the raw material
The shortage of raw material slows down the growth of exporting.
This is a raw material oriented industry. We have been dealing with a shortage for a long time. It doesn´t matter what the raw material costs are as long as the timber price allows us to make a living."
Turunen says that it´s sad that so much wood remains in the forests.
"Forests grow at approximately 100 million cubic meters a year, but only on third of it is used. The quality weakens when the forests are not taken care of and the wood is over-age. We lose profits, which is a waste for the national economy as well."
There is strong competition over Nordic pine between Sweden, Finland and Russia.
"In Sweden, they saw 16-17 million cubic meters every year. Our new record was set in 2007 with 13.6 million cubic meters. Major Finnish sawmills have been closed down. Last year we only got 7.6 million cubic meters and we lost our share of the export market."
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