Originally posted by Dialtone:

If you use an old world from before they made the change there's a code you have to type in to update the terrain to the new format.

"To get Valheim to apply the terrain changes made in this patch, you'll need to use the game's console. First, add “-console” as a launch argument for Valheim, then once you're in-game use the console command “optterrain.” Afterwards, all the terrain nearby will be converted to the new system." -google