Market environment

The market remained uncertain in 2023. While inflation stabilized and slowed down during the year, increased interest rates and overall uncertainty in the global economy impacted on the market outlook, which was reflected in the demand for Raute’s customers’ products. The raw material availability started to limit customers’ production volumes, especially due to the lack of Russian birch logs, which used to be an important raw material source before 2022. However, the fundamental demand for Raute’s solutions was still at a reasonable level.

The slowdown of the construction market and elevated uncertainty in the global economy reduced the demand for softwood plywood, especially in the European and North American markets, and from the second half of the year onwards, also for hardwood plywood.

Customer activity and interest in Raute’s technology for mill-sized projects, modernizations and after-sales services have remained high. This trend is supported by customers’ long-term capacity planning horizon, regardless of the current market situation. During 2023, Raute received four major mill-sized orders worth about EUR 216 million in total.

The activity level of Raute’s customers varied depending on the geographical location. The demand for other than mill-sized projects was modest in Europe (EMEA) and Latin America, relatively good in North America, and low in Asia-Pacific and China, which still suffered from a significantly weaker investment activity.

Customers’ declining production volumes have impacted the demand for spare parts. Also, demand for single-machine replacements or enhancements was low.

Plywood and LVL industry’s market close to EUR 50 billion a year.

Investments in veneer, plywood and LVL production technology under normal market conditions close to EUR 1 billion a year (of which EUR 600 million is relevant to Raute).