Dansk-svenskt samarbete inom kalkstens- och cementindustrin

Abstract

Cooperation between Danish and Swedish Firms in the Limestone and Cement Industry

Cartels and other forms of cooperation were common in many industries in Sweden and Denmark during the late 19^th century and the first half of the 20^th century. Cartels were legal, but the authorities restricted cartels that misused the cartel form. Cooperation could be beneficial since they could lead to a more efficient organization of the production. The aim for many of the cartels in the Nordic countries was to create stability, rather than raising prices. 

Cooperation in the Limestone Industry

In the late 19^th century there was great demand for limestone since many new industries, such as sugar, steel and paper, needed the limestone for purification. In southern Sweden Skånska Cement established cement production and quarrying of limestone. Many Danish merchants were also engaged in the limestone industry of southern Sweden. In the beginning of the 1880s the Skånska Cement got competition from the Danish limestone quarry, Faxe Kalk A/S. Immediately representatives for the Danish and the Swedish companies discussed grounds for a cartel agreement between the two firms. They did not agree at that time, but a couple of years later they entered into an agreement. 

In 1889 Faxe and Skånska Cement started a joint sales company for limestone and agreed to cooperate for the upcoming 50 years. The agreement included quotas that would balance the output of limestone from the two companies. In the first years of the agreement there were often discussions concerning the quotas, but the arguments were always solved and the two com-panies continued to cooperate in joint companies and through agreements into the 1970s. 

In the beginning of the 20^th century, fierce competition came from Gotland, an island in the Baltic Sea. In order to face the competition Faxe and Skånska Cement bought limestone quarries in the same geographical area and established a joint-sales company for limestone from Gotland. Many of the competitors were part of the new sales company and an agreement was made to divide the Swedish market between the sales companies. The result of the division was that Faxe and Skånska Cement could sell limestone on the whole Swedish market while the competitors only could sell on the Eastern part. The sales company was not successful since there was an overflow of limestone on the market and the prices decreased. 

Measures was taken by Faxe and Skånska Cement and they started a new company, Gotlands Kalkverk, together with their main competitor, Karta och Oaxen. The aim was to control the sales of limestone in the Baltic Sea and the Danish islands. After the establishment of Gotlands Kalkverk the forms for the coope-ration between the Danish and Swedish limestone companies were consolidated. There was no interruption of the cooperation and few discussions about how the affairs should be run. The main problem the collaborators had to face was the threat from outsiders entering the market, since there were few barriers against entrance.  

After World War II, mechanization of the limestone quarries was the main issue. The investments were costly and Gotlands Kalkverk had many active quarries. During the decades before the war the outtake of limestone had gradually increased from Gotland and the region was the most important supplier of lime-stone. The Danish and Swedish owners decided to concentrate the quarrying to only one quarry and mechanize that quarry.  The investments were heavy and Gotlands Kalkverk could not bear them alone. In the 1950s Gotlands Kalkverk merged with the lime-stone company owned by the Swedish sugar industry. Together they took over the running of the major limestone quarries on Gotland in the joint company Gotlands Förenade Kalkbrott (GFK). 

During the 1960s and 1970s, GFK acquisitioned several of its com-petitors and the mechanization process accelerated. The quarries became bigger, the quarrying process more efficient and many small companies left the market. GFK dominated the Swedish limestone market and exported to several countries, for example to the Danish sugar plants. In the mid-1970s, the Swedish cement company, Cementa, wanted to expand its affairs in lime and lime-stone. Cementa bought the shares owned by Faxe and the Swe-dish sugar company, in order to integrate the limestone business into the Swedish cement industry. A long and fruitful cooperation between the Danish and Swedish limestone industry ended. 

Cooperation in the Cement Industry

The cooperation in the cement industry was quite different from the one in the limestone industry. In the limestone industry the strategy had been to create joint companies, and to sell through joint sales companies. In the cement industry the cooperation was mainly channelized through traditional cartels and common pro-jects. 

Already from the early days of the Danish cement industry, there were important links to the Swedish cement industry. The Danish firm FLSmidth & Co built cement factories in Sweden and was the pioneer in the Danish cement. The first Danish cement factory was established by FLSmidth & Co in Aalborg 1889. In Aalborg new technology was tested and improved, which was an essential part of FLSmidth & Co’s development into a world leading company for cement machinery. The connections with the Swedish cement industry were maintained and in the beginning of the 1890s they resulted in a joint project for producing sand cement. It was no success, but it stands as a good example of the shared interests. Another example is the investments that the Danish and Swedish cement industries made in the Estonian cement factory Port Kunda.

In the last decade of the 19th century, the prices on cement in Denmark were declining due to imports from Sweden and Germany. In 1895 the Danish, German and Swedish producers came to an agreement where the Scandinavian factories set up their own cartel and connected it to the German cartel. The agreement was terminated in 1902, but an agreement between the Danish, Norwegian and Swedish factories was established instead and after three years the connection to the German car-tel was reconnected. The cooperation continued until 1917 when the agreement was terminated because of the war. The German and the Swedish factories made a deal, but the Danish cement industry chose to compete on German market. FLSmidth took part in the establishment of a cement factory that competed with the German cartel. The cooperation between Denmark and Sweden continued even without a formal agreement, they respected each other’s home markets. 

The markets of Denmark and Sweden were controlled by do-mestic sales companies that also functioned as cartels. In the first years of the 20^th century the Danish cement cartel was challen-ged by an outsider, Dansk Andels Cementfabrik. The competition also affected the Swedish cement cartel, since the Swedes sold cement on the Danish market. The Danish cement cartel informed the Swedish cartel about price changes and the Swe-des changed their prices accordingly. The competition from the Dansk Andels Cementfarbik was a reoccurring theme in the co-operation. In the 1930s, Swedish wholesalers started to import cement from the Dansk Andels Cementfabrik and that caused decreasing prices on the Danish market. The Danish cement car-tel turned to the Swedish cement cartel in order to get support. They agreed that cement from the Danish cartel would be imported and sold in Sweden under another brand. 

The Swedish cement cartel was not pleased with the import and took their chance to end it when there was a controversy concerning the layoff of labourers from a Swedish cement factory. The Swedish cement cartel argued that they had to shut down the factory due to decreasing market shares since there was so much Danish cement on the market. The Swedish govern-ment became involved and helped meddling a deal that limited the imports.  

Up to the 1930s the cooperation in the cement industry had been bilateral, but in the end of the 1930s a European cement cartel was formed, and later reinstated after World War II. There was no longer need for cartel agreements between Denmark and Sweden, but the industry in the two countries remained close. For example, when Sweden could not fulfil the demand for cement they imported cement clinkers from Denmark and the companies continued to respect each other´s home markets.  

Different Forms of Cooperation

The cooperation in the limestone and the cement industry diffe-red, even though some of the actors were active in both indu-stries. In the limestone industry the joint sales companies dominated, the Danish and Swedish cooperation had to change form several times and adapt to changes in the market. The cartels in the limestone market did not hinder newcomers – when new firms entered the cartels had to adjust to the new situation. The cooperation between Faxe and Skånska Cement on the limestone market was long lasting. The companies were in it for the long run; they found a common ground and trust was built up between the collaborators. The tight partnership took a lot of effort, but it also made the cooperation strong. 

The cooperation in the cement industry was mostly centred on imports and exports. The most important thing for the Danish and Swedish cement industry was to make sure that their home markets were free from import. There were strong domestic cartels in the cement industry and these national cartels formed the international cartels. The national cartels cooperated in kee-ping the outsiders out of the market and they engaged in joint development projects. The cooperation between the Danish and the Swedish cement industries was important for the development of the industry, for example the world dominating Danish company FLSmidth & Co started out and developed through the cooperation.

The cooperation was important in both industries since it gave stability. The cooperation did not just reorganise the market, there was also exchange of ideas, technology and information. The cooperation was successful in both industries since they managed to adapt to changes while still continuing the coope-ration.