Södra recorded an operating loss of 424 million Swedish kronor in the second quarter of 2026, compared with weaker results across most of its main businesses. Net sales fell 3.4% to 6.95 billion kronor from 7.19 billion kronor, while the operating margin was negative 6%, Södra reported.
Lower delivery volumes accounted for most of the year-on-year decline. Weak demand and low product prices remained out of balance with raw-material costs, while delays in the value chain meant that price adjustments had not yet taken full effect.
The global pulp market remained oversupplied, which continued to pressure prices. Södra’s pulp deliveries developed as planned and reached customers, but demand for paper and board remained weak. Dissolving pulp demand was stronger.
Demand for lumber varied by market during a period that normally brings higher seasonal activity. Sweden, the U.S., the U.K. and Northern Ireland remained weak, while parts of Europe recorded higher activity. Low construction activity continued to affect cross-laminated timber operations, although the residential segment showed some recovery.
Electricity, biomethanol and turpentine recorded stronger demand and prices during the quarter. Solid biofuels faced more varied conditions. Södra Bioproducts generated quarterly sales of 888 million kronor, up from 704 million kronor a year earlier.
Södra reduced overhead costs by 202 million kronor during the quarter and by 329 million kronor since starting its cost program. The company cut consulting expenses, reassessed and completed major information-technology projects, and adjusted staffing. Continuous-improvement measures produced efficiency gains of 122 million kronor, while contribution margin improved 5%.
Södra Woods posted an operating loss of 215 million kronor, compared with a profit of 3 million kronor a year earlier. Lower delivery volumes, slightly lower market prices and higher raw-material costs drove the decline.
Södra Cells reduced its operating loss to 88 million kronor from 221 million kronor as delivery volumes increased and overhead costs fell. Lower maintenance-shutdown expenses also improved the result.
Södra Skog recorded an operating loss of 12 million kronor, compared with a profit of 7 million kronor, as deliveries and revenue declined, mainly for spruce sawlogs. Södra Building Systems posted a loss of 45 million kronor, compared with 44 million kronor a year earlier, as the construction market remained weak despite stable sales and cost controls.
In May 2026, the average price for the lumber exported from Sweden contracted 11% compared to the previous month at $288 per m3, according to Lesprom Analytics. This is 16% less than a year ago when it was $340. The exports of lumber from Sweden contracted 33% year-on-year.