Forestry: Kesla joins major manufacturers in cutting back

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ANOTHER week, another forestry firm announcing it will be laying off workers.

This time it was the turn of Kesla, the name behind some of the most popular timber trailers, cranes, and harvester heads in the business; but that hasn't saved it from an increasingly difficult global downturn.

In a press release published this week, the Finland-based manufacturer said as many as 25 jobs could go as it aims to cut 30 per cent of its staffing costs. Blaming the move on lower order levels than pervious years, Kesla's bosses said they will begin negotiations with its "entire personnel" regarding an organisational restructure, but provided no details as to which areas of the workforce are at risk.

Kesla creates a number of forestry-related products

This is not entirely unexpected. When manufacturers like Ponsse and Rottne are having to cut jobs in a bid to save cash – with as many as 140 at risk at the former – it isn't a surprise to see other names following suit.

But perhaps the most worrying aspect of the Kesla development came in a quote from its interim CEO. "The value of the orders received remains on lower level than in the corresponding time of the previous year, and there is no clear change in demand for the better in the coming months," said Ilkka Miettinen.

In other words, it could be some time until the market stabilises and things take a turn for the better. "The uncertainty of demand in market areas important to Kesla has continued as interest rates remain high and the geopolitical situation remains unstable," added Ilkka.

That's the thing about forestry; it is so dependent on global factors. A pandemic saw a boom – perhaps unlike anything experienced before – when the mills could hardly get the timber out fast enough. In the years since, just about everyone FJ has spoken to has told of a slowdown, with contractors up and down the UK struggling to sell timber at the roadside.

Usually, that can be blamed on rising imports, but even these have fallen by nearly 10 per cent at the start of 2024 compared to the same period in 2023, according to recent analysis from Timber Development UK.

It is a difficult period for forestry. The public are tightening their belts and, as a result, so are the major manufacturers.

Rottne has also previously announced cuts to its workforce (Image: Stock image)

Restructuring projects are being seen across the industry, with even long-established businesses overhauling their model; or, in the case of Clark Tracks, shifting operations entirely.

For the forestry professionals who have been doing this since before FJ was even born, peaks and troughs will be nothing new, and the current situation is not all bad news.

But just how long this trough last for will be the key to how forestry looks like when we emerge from it.