With secrecy around gamedevelopers and publishers nowadays, its hard to give information that is 100% reliable.
But from as far as I could find, Valheim is being developed by a 5 man team.
That is a rather small team for a game, especialy for a 3d game.

Thats not to say they are still rather slow compared to other developers that I know released great games. But its a reason for the slow progress, non the less.
I dont think the game is dead quite yet, but it will take a realy long time before its released at this pace, thats for sure.