about the picture

The mills needed to be expanded to create demand for the excess wood, especially smallwood. Here, wood raw material is being delivered to Södra´s pulp mill at Mönsterås.

Forest farmers began to organise themselves during the 1900s, alongside dairy and beef farmers. The forest associations initially held an advisory role, with the aim of promoting effective forest management. At the beginning of the 1900s, Sweden was a deforested country. Forests had been cut down by unscrupulous forest industries that bought up and harvested the estates of small forest farmers. The farmers were poorly paid for their forest, and were not entitled to any further returns on their sales. A case in Northern Sweden is considered the starting point for the growing cooperative movement – Baggböleri. The term was coined in the period when forest owners in Northern Sweden were tricked into selling their forest for low prices to sawmills, including the Baggböle sawmill. The Norrland Prohibition Act of 1906 banned the practice.

The first forest-owner association was formed in Halland in 1913. A rapid line of county associations soon followed in Skaraborg, Kronoberg and Kalmar. In 1926, the Smålands Skogsägareförening (Småland forest-owner association) was formed by merging the county associations. This marked the beginning of a series of mergers that has since continued.

Firewood was Södra’s primary product in the early 1940s. The photo shows two of Södra’s wood-gas powered trucks bought in 1941.

Co-operative societies
The starting point for the reorganisation into co-operative societies was the Depression in the 1930s, when the Swedish government stimulated a transition from imported fuels to Swedish firewood. Since a legal entity was required for trade with firewood, several of the forest-owner associations reorganised into co-operative societies. The associations purchased timber from their members and sold it to sawmills and pulp mills. The money was then paid to the members, at a price that had already been negotiated. A key part of the business operation was also to assess the solidity and honesty of the wood buyers. Measurement of the wood was imprecise, with an error measurement of about 30 percent in the buyers’ favour.

A forest industry evolves
Sydöstra Sveriges Skogsägareföreningars Förbund (Södra) was formed in 1938. This federation was also organised as a co-operative society, a structure that would remain important for Södra’s continued development.

Södra’s first major business venture, and springboard into the industrial sector, was a tar and turpentine plant in Lenhovda. The end-products were used as fuel in the company’s passenger cars during World War II, sold to hospitals, military facilities and private property owners.

Mönsterås factory in oktober 1964

Forest regeneration takes a long time, and the mismanagement of forests in northern Sweden became more and more evident. This had been obscured by export restrictions during the war, but the shortage became apparent when the war was over. The situation was somewhat different in southern Sweden. After the war, demand for firewood declined when imports of coal and oil resumed and farmers had difficulty finding markets for their smallwood. Firewood accounted for 61 percent of the wood sales in 1944, but only 8 percent by 1950.

An industrial expansion was required to take care of the surplus wood, especially smallwood. Markets for sawmill by-products were also few and far between. According to Södra’s estimates, the by-products were enough to supply a pulp mill with a capacity of over 100,000 tpy of production capacity.

 

...if the private risk-bearing capital do not show an interest in our problems, we are also prepared to take the matter into our own hands and personally contribute to an expansion of the wood-consuming industries..

/Gösta Edström

The first pulp was produced at Mönsterås in November 1958. It marked the start of Södra´s investment in the wood pulp industry. Over the years, bold initiatives have borne fruit in the form of increased wood consumption, higher wood prices and profitable mills. The profits were reinvested into the company and distributed back to the owners. An industrial group was born.