Pata: This year the situation in the forest industry is similar to the situation last year

This year, the situation in the wood industry is similar to the situation last year, Jānis Mierkalns, a member of the board of the wood production and trading company SIA “Pata”, told LETA.

He said there is still low demand in the export markets for soft wood products, which are used by consumers for building construction, renovation, repair work, as well as making furniture and decorations.

Similarly, the policy sector of the European Central Bank, the US Federal Reserve System and the Central Bank of Japan to slow the economy and reduce inflation is still felt. Although interest rates have been gradually reduced, which is slowly increasing the resources available to consumers and money in the market for development projects, no major changes are currently being felt.

He expected to see a real increase in demand only at the end of this year or in the first half of next year.

Mierkalns admitted that this was a difficult time for many companies in the forest industry, but it should be remembered that this is the detail of this industry. The forest industry is one of the pillars of Latvia’s national economy, accounting for about 20% of Latvia’s product exports. This means that the industry is very dependent on the global economy and its circulation.

Therefore, it should be noted that the number of logging operations has decreased significantly in recent years, which means that as the economy grows, a situation may arise where the demand is higher than the supply, leading to a significant increase in the final prices of goods.

He also noted that in the last two years, it was possible to organize nationally the issues that contribute to the competitiveness of manufacturing companies and the export of the industry in foreign markets. Organized issues related to getting cheaper electricity by disconnecting from AS “Sadales tīkls” and connecting to AS “Augstspriegumu tīkls” electricity transmission, access to qualified personnel, to special specialization in electronics and mechanics, as well as access to capital.

It is already reported that in 2023 “Pata” works with a turnover of 234,801 million euros, which is 29.7% less than the previous year, but the profit has decreased several times – to 1.639 million euros .

The company was registered in 1999, and its share capital is 16.135 million euros. Uldis Mierkalns is the sole owner of “Pata”.