Finland – Forests and Forestry

Forest resources

Finland is Europe’s most heavily-forested country. Forests as defined by the FAO cover 23 million hectares or 74.2% of the land area.

In Europe, Finland is a “forest giant”, there being over sixteen times more forest per capita than in European countries on average. Finland’s forests have been intensively harvested over the last few decades. Despite the loss of land after the last wars, its forest reserves are now greater than ever before in the 20th century, and they are continuing to grow.

Finland’s forests are probably the most intensively studied in Europe. Since the beginning of the 1920s, they and especially the wood resources that they contain have been inventoried and monitored in a great variety of ways. The inventory system now in use incorporates about a hundred variables, which relate not only to the volume and composition of wood resources, but also to such matters as soil, vegetation cover, and the health of trees. Few non-experts taking a stroll in a Finnish forest are very likely to realize that the ecosystem surrounding them is the subject of such precise monitoring and statistical recording.

The total volume of a stock in Finnish forests amounts to nearly 2 billion cubic meters. This amount of timber would make a 10-meter wide and 5-meter high wall around the globe.

For as long as there has been an independent Finland, the increment of stock has exceeded harvesting volumes and natural drain. Today the annual increment is about 75 million cubic meters, whereas around 60 million cubic meters or less are harvested or die of natural causes. Of the total logged area, regeneration felling accounts for roughly one-third and thinning two-thirds.

Geographically, most of Finland is situated at a latitude of between 60 and 70 degrees north. A significant area extends north of the Arctic Circle. The climate in Finland and Scandinavia is influenced by the Gulf Stream bringing warm water from the Atlantic. Thanks to this, there are forests even in the northernmost parts of Finland. Areas located equally far north in Russia and North America are mainly tundra, a treeless wasteland, because of the cold climate.

Winters in Finland are quite mild, and summers are temperate although of short duration. In the south, winter lasts about three months, in the north about six months. In wintertime, the ground is covered by snow, and temperatures usually drop below zero degrees centigrade. Despite the briefness of summer, there is a lot of light, enabling an intensive growing season.

Precipitation is sparse: on average 700 mm in southern Finland and 400 mm in the north. About half of this is snowfall. Around late winter, there can be more than a meter of snow in Lapland, less in the south. Many organisms would not survive the winter without the sheltering snow; the roots of plants would freeze and the cold would kill the animals moving at ground level.

Finland lacks real mountains but, on the other hand, the terrain is not altogether flat, either. The bedrock and the soil in general have been formed by the ice ages. The inland ice has eroded the bedrock, scraping off soil from here and leaving heaps there. In places, the rock is totally exposed. The tens of thousands of lakes in Finland are post-glacial. Another unique phenomenon, land elevation, is also an effect of the glaciers. Finland is rising from the Baltic Sea at an annual rate of 0.5-0.8 cm, which means that its land area is continuously growing.

Finland - Forests

Various kinds of peatlands are a fundamental element of the Finnish landscape. In the cool and humid climate, the soil becomes waterlogged, which creates the right conditions for peatland vegetation and the formation of peat. Originally, about one-third of Finland was covered by peatlands. They have been drained for farming, forestry, and peat extraction purposes. About half of the original peatland area has been preserved in its virgin state.

There are about twenty indigenous tree species growing in Finland, the most common ones being pine (Pinus silvestris), spruce (Picea babies), and birch (Betula pendula and B. pubescens). Usually, two or three tree species dominate a forest. Naturally pure pine stands are found in rocky terrain, on top of arid eskers, and on pine swamps. Natural spruce stands are found on richer soil. Birch is commonly found as an admixture, but it can occasionally form pure birch stands.

About half of the forest land area consists of mixed stands. Rarer species are found mostly as solitary trees. The southwestern corner and the south coast of Finland are touched by a narrow zone growing oak, maple, ash, and elm.

Finnish forestry aims at imitating natural succession. Here it is quite unproblematic to practice near-nature forestry: the commercially valuable tree species belong to Finland’s natural flora and can be grown on their natural sites. Forest regeneration is comparable with forest fires or storms, and intermediate felling resembles natural thinning.

The forests have managed a compartment at a time, i.e. felling or management work is directed at a part of the forest with a homogenous tree stand. The average size of a compartment is less than two hectares. Even a natural forest has a certain mosaic-like structure: young stands here and more mature ones there. Forests are allowed to grow between 60 and 120 years, depending on the tree species and the composition of the site.

Rather than being systematic and dull, the forests are rich in variety and subtlety of detail. Especially in the southern and central parts of the country, one can find a great variety of forest types within even a small area: dense stands of spruces, pines scattered thinly on poor, healthy soils, clearcut areas, scrub in river and stream valleys and stunted growth in valley bogs.

Individual hardwood trees grow scattered among conifers and here and there one finds homogeneous stands of white birches. The trees also vary widely in age. They are not monocultures, nor do the trees stand in straight, evenly-spaced lines.

Yet Finnish forests could not be said to be in a natural state, either. Agriculture, tree harvesting, and active silviculture have been reshaping forests through the ages. As a rule, not even the oldest and apparently most natural forests prove to have remained completely untouched by the woodsman’s axe when one looks two or three centuries back into their history. Prolonged use has gradually made the forests more uniform and consistent in character.

In the 20th century, foresters have favoured conifers, especially pine, at the expense of other species. The oldest generations of trees have been gradually felled and the forests have in general become younger. Forestry and forest roads have fragmented large contiguous wilderness areas. Forest fires and other natural disasters have been largely prevented, and effective management has increased growth rates. Managed commercial forests of this kind now cover over 90% of Finland’s productive forest land.

Finland - Forests

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Forests have been Finland’s most important natural resource for centuries. In the 17th and 18th centuries, those in the southern regions of the country yielded wood for shipbuilding, whilst further inland they were slashed and burned to provide temporary cropland or provided the raw material for pine tar. The 17th century saw Finland become the world’s leading tar producer.

The scale on which wood was being consumed attracted the attention of the powers-that-be in Sweden, of which Finland was then part, and around the middle of the 17th century the Riksdag passed legislation making it more difficult to obtain permission to open a sawmill. This step was taken to ensure that there would be enough charcoal to meet the needs of ironworks. The primary goal of later forest legislation was to ensure an adequate supply of raw materials for the wood-processing industry.

The Finnish wood-processing industry began with sawmilling, but the main emphasis nowadays is on pulp and paper. The forest products industry as a whole is second only to metal products as an export sector. It uses an enormous volume of wood, but nevertheless, the amount fell in the country’s forests each year is no more than it was in the 1930s. That is because a lot of wood was used as fuel in the early decades of the 20th century.

As a result of improved forestry methods and bog drainage, our forests nowadays contain more wood than they did sixty years ago. And that in spite of the fact that the territories that Finland had to cede to the Soviet Union at the end of the Second World War contained over an eighth of our total forest area and in excess of a fifth of our best saw-timber stands. Bog drainage reached a peak in the 1970s when nearly one percent of the country’s total land area was being drained each year. All in all, more than half of the original total bog area has been drained in the course of the centuries

The wide variety of topography and growing conditions in Finland has mitigated forests becoming uniform, cloned monocultures. Another factor explaining the mosaic patterns and fragmentation that are features of forests everywhere in Finland is ownership. Although the King declared away back in the 16th century that all of the uninhabited wilderness areas in the country belonged to the Crown, much of the land was later given to existing estates or to newly-established ones for a variety of reasons.

 Forest Ownership
Fig. 1 – Forest Ownership Most of Finland’s highly-productive forests, especially those in the southern and central parts of the country, are owned by private persons. The State owns most of those in Lapland, for which reason the northern forests have been managed more uniformly and on a larger scale than those elsewhere. Source: Finnish Forest Research Institute


Today, private persons own nearly 60% of the Finnish forests and one in five of the national population belongs to a forest-owning family. The average size of a private forest holding is 30 hectares. With everyone tending and felling his or her own trees, which are often growing on several scattered lots, extensive uniformly-managed areas of forest have not come into being.

Family forestry is the cornerstone of Finland’s forestry. Three-quarters of the wood raw material used by industry comes from private forests. Ownership is divided over a broad spectrum of the population, with every fifth Finnish family owning some forest.

Finland forest regeneration

The interest that private owners take in their forest holdings goes well beyond income from selling wood. For many, the home forest is their childhood landscape, which they would like to preserve in as unchanged a state as possible. Other important values are biodiversity and the berries, mushrooms, and game that the forests provide. Values other than wood production have likewise begun to be strongly emphasized in national policy on forests. After a long public discourse on the matter, the legislation dealing with this sector was thoroughly revised in the 1990s.

An environmental program for forestry was adopted in 1994. It was based on two international documents: the set of forest-related principles approved at the UN Conference on Environment and Development in 1992 and the general principles for sustainable forestry adopted at the second meeting of European forest ministers in Helsinki the following year. With the adoption of the environmental program and the entry into force of the new legislation, the goal of Finnish forestry became one of not only ensuring a sustainable economic return but also preserving biodiversity and facilitating multiple uses of forests.

The goal did not remain merely an aspiration expressed on paper. Four years after the adoption of the environmental program, we can see that much progress towards the sustainability stipulated in it has been made. This is reflected on the ground in the almost total abandonment of heavy-handed practices like bog drainage, deep plowing of forest soil, and using herbicides to kill undergrowth.

Habitats of importance for the preservation of biodiversity have been excluded from forestry and felling operations, and both living and dead trees have been left in felled areas. Natural regeneration of trees has increased in importance relative to planting nursery-grown seedlings and more attention is paid to preserving forest landscapes.

The aim is that ecological landscape plans will have been drafted for all significant contiguous areas of state-owned forest by the end of the year 2000. Regional programs and holding-specific plans with the aim of ensuring economically, ecologically and socially sustainable forestry practices are being drafted for private forests.

Endangered Species in Finland

Endangered Species in Finland

If the development remains as positive as it has been up to now and the goals are achieved, the Finnish forest environment will offer more richly varied landscapes and habitats for a greater variety of flora and fauna. The threat that forestry poses to both will decline. For the moment, however, forestry is still a greater threat to the preservation of species than any other human activity.

One reason for this is that about half of the plant, animal and fungus species found in the country live in forests. Of the various threatening factors attributable to forestry, the most important are changes in the ratios of tree species to each other, which mainly means a decline in the proportion of deciduous woodland containing stout trees and decaying trunks. Both of these problems are now gradually easing.

Damage to Forests
Fig. 2 – Damage to Finnish Forests


There are about 3,000 threatened species in the Nordic region. According to OECD, Finland and Sweden are among the countries in Western Europe that have the smallest number of threatened species, regardless of whether plants, insects, fungi, birds, etc. are concerned. The situation is not critical for most of them. The list of endangered species in Finland contains about 1,700 plants, animal, and fungus species, of which 138 are feared extinct.

The vertebrates that have made it into the Red Data Book include all four of our large predators: the bear, the wolf, the wolverine and the lynx. Hunting restrictions and active protection have improved the position of these animals in recent years. Bears and lynxes now number nearly a thousand each. Wolves and wolverines each number 150 or so.

Populations of some birds of prey have likewise revived markedly in recent decades. The number of breeding pairs of sea eagles has grown from under ten in the 1970s to about 140 now, largely thanks to winter feeding. One of the biggest success stories of them all is that of the whooper swan, Finland’s national bird. Only 15 pairs were nested in Finland in the 1950s; now there are 1,500 pairs.

However, there is a risk that some of the most threatened species will die out in the near future if the factors putting them at risk are not removed, or if conditions conducive to their survival are not created.

Their long-term survival is not regarded as secure if their total number is small, or if their habitats are threatened in the long term.

Approximately half of the threatened species are found in forests. Forest companies in the Nordic countries are therefore working intensively to ensure both the short and long-term survival of the species in their forests. This involves personnel correctly locating those habitats that threatened species need for their survival. These places then receive special care and attention.

Some species have, however, become extinct in the Nordic countries during the last few hundred years. There are many reasons for this, such as changes in agriculture, forestry, infrastructure, and air and water pollution.

For many hundreds of years competition between predators and humans was intense. The predators took livestock and as a result, many birds of prey and other predators became threatened. Through active conservation policies, these predators have in recent years increased in number and their numbers are still growing.

For example, the wolf population in Sweden has grown from a few individual animals at the beginning of the eighties to over 40-60. Growth trends for total populations, taking Sweden and Finland as a whole, are similar for lynx, bears, and wolverines. The latest figures (1996) show that in Finland and Sweden there are altogether approximately 2,200 lynx, 1,800 bears, 150 wolves, and 360 wolverines. Government authorities are monitoring the population and hunting, if allowed, is strictly regulated.

More Parks and Nature Reserves

Finland has 30 national parks with an area of 6,743 km2. Together with other nature reserves, the total protected area amounts to approximately 29,000 km2, or about 9% of the total land area of Finland.


To this is added the nature reserves and other areas which are increasingly being provided by private forest owners, from individual forest owners to large forest industry companies.

Protecting habitats either totally of partially from human activities is the main way in which an effort is being made to improve the situation of endangered species and encourage biodiversity.

Where forests are concerned, this mainly means protecting the remaining old-growth stands and broadleaf woodland growing on rich soil, because these are the habitats that have been declining most rapidly.

The Government adopted a special protection program for old-growth forests in 1996. Another program to protect broadleaf woodland has been in effect since the late 1980s. All in all, there are ten or so programs designed to protect various types of natural features and areas.

The aim is that they will extend protection to 3.1 million hectares of land and water, some ten% of the national territory, by the year 2007. About 2.7 million hectares had been included in the programs by the beginning of 1999.

One of the obstacles in the way of designating protected areas is that very strict limitations on the ways in which they can be used are generally set. When land remains in the possession of private owners, they are paid compensation for these restrictions.

The main rule is, however, that the State acquires land intended for inclusion in protection programs. There are also elaborate arrangements for consultation with landowners during the planning stages of protection programs. This process of consultation was followed when the areas for inclusion in the Finnish Natura 2000 scheme were being designated.

The planning work for Natura was exceptionally thorough and took place in several stages, which was partly due to the fact that several thousand private landowners were affected. Besides that, very ambitious goals had been set for the program and every effort was made to implement it in a way that would optimize prospects of their being achieved.

More than 1,450 areas totaling nearly 4.8 million hectares have been proposed for inclusion in Natura 2000. Three-quarters of this is land and the remainder water bodies. Most of the areas are already protected, being national parks or wilderness.

The largest category of protected areas are the wildernesses in Lapland. Unlike the other areas, they have been established under a separate Act of Parliament. They cover a total of nearly 1.4 million hectares of forest, bog and treeless Arctic fells in the northernmost part of the country.

Provided it is done carefully and within pretty strict limits, forestry is permitted in some parts of these wilderness areas.

The total area under nature protection in Finland, January 1998
National parks (hectares)
Nature reserves 689,1
Peatland areas 149
Bird waters 588,3
Shore lands 83
Herb-rich forests 145,5
Old-growth forests 5,2
Special protected areas 344,1
Other protected areas on private land 44,8
Wilderness areas 15,1
Total 1,377,800

New National Forest Policy and Program

New National Forest Policy and Program

Finland has in its national forest policy sought long-term solutions, the most important program being Finland’s National Forest Program, sanctioned by the Government in March 1999. The NFP is the most comprehensive Finnish forest program to date. It recognizes the economic, ecological, social and cultural aspects of the sustainable utilization of the forests. In addition to national needs, it also meets the new demands of international forest policy.

The NFP is the most representative example of how different groups of the public can be incorporated into decision-making. The NFP work was based on the regional forestry programs, on the one hand, and on the other ideas and initiatives received from various parties and at numerous information and feedback meetings. While preparing the program, the working groups consulted 38 experts, and the NFP was discussed in 59 Public forums with almost 3,000 participants. The public were also given the opportunity to influence the preparatory work via the Internet.

The NFP’s goals are to increase the industry’s annual consumption of domestic wood by 5-10 million cubic metres by 2010, double the wood processing industry’s export value and increase the annual use of wood for energy to 5 million cubic metres. In addition to this the State will, in collaboration with forestry companies and businesses, ensure competitive conditions for the forest industry, such as supplying energy at a competitive price, and launch the technology and development programs needed for promoting the wood processing industry and wood-based energy production.

Based on the Environmental Program for Forestry, the NFP secures ecological sustainability in ecosystem management by proposing more funding for this. Ratified protection programs on private land will be implemented. A broad-based new working group will assess the need for protective measures, based on research, and draw up a forest protection program, observing the economic and social aspects, of southern Finland, the western parts of the Province of Oulu and the southwestern region of Lapland.

Furthermore, the NFP recognizes and promotes in conjunction with forests utilization and protection the multiple-use of aspect, including hunting, reindeer husbandry, wild mushroom and berry picking, scenic and cultural values, recreation, and tourism. Forest-related know-how and innovations are advanced by intensifying research, the implementation of results, and training. The interaction between the producers and consumers of information is boosted by creating an Innovation Forum. An internationally active forest policy, forest research and training cooperation, and forest and environmental information are the means to secure Finland’s interests and promote sustainable forestry.

Finland is heavily dependent on the forest and the good condition of forest ecosystems; one third of the country’s export earnings come from forests.

For several decades now, Finland has been concentrating on sustainable timber production and the health of the forests to create the foundations for the sustainable use of the latter. Sustainable economic use of the forests paves the way towards, and provides resources for, the safeguarding and enhancement of the ecological and social sustainability of the forests as well. Ecological and social sustainability nowadays is just as important as sustainable timber production. With this in mind, Finland has reformed the most important Acts applying to the forests, as well as the forest management guidelines, in the course of the 1990s.

Finland drew up a forestry environment program in 1994. At the beginning of 1999, a National Forest Program emerged to guide the activities of the entire forest sector. Criteria have been laid down in Finland as a basis for forest certification. Using these criteria it is possible to evaluate the achievement of sustainable forestry in practice. As an EU member state, Finland actively participates in the Union’s forest affairs. EU decisions affecting forestry and the forest industry are of immense importance to Finland since the country’s economy is much more heavily dependent on forests than that of other member states.

Forest Industry in Finland

Forest Industry in Finland

For decades, the forest industry has been the backbone of Finland’s national economy. The solid foundation of the Finnish industry is the industrial manufacture of forest-based products, which has its roots in the 19th century. The export income of the wood processing industry and the employment it offers have maintained a fairly constant economic growth.

Forest industry production in Finland increased by nearly 5 % in 2000. Production rose to record levels in every main category. Plywood production showed the fastest growth, rising by over 8% compared with the previous years. Production totaled about 1.2 million cubic meters. Sawnwood production rose by nearly 5%. Production in 2000 reached a record 13.3. million cubic meters. Paper and paperboard production reached in 2000 a record 13.5 million tons, up 560,000 tons or 4.3 compared with the previous year.

The forest industries’ annual consumption of domestic roundwood amounts to more than 50 million cubic meters; of this 30 million cubic meters are used in chemical and 20 million cubic meters in mechanical processes. The chemical wood processing industry produces paper and board, chemical/semi-chemical pulp, and ground pulp; the paper and board converting industry also belongs to this category. The mechanical wood processing industry produces sawn timber, plywood, chipboard, fibreboard and building timber.

Paper and Paperboard Production in Finland in 2000:
Total 13.5 million tons
mechanical pr&wr-paper; 5.3 m.t. (40%)
woodfree pr&wr-paper; 3.0 m.t. (22%)
newsprint 1.4 m.t. (10%)
paperboard 2.8 m.t. (20%)
other paper 1.0 m.t. (7%)

The wood-processing industry makes good use of raw materials. Timber logs are either sawn or veneered to make plywood. Pulp wood is processed into pulp and paper. The topmost part of the tree trunk is chipped for energy production or left to decay in the forest where the nutrients are released back into the ground to fertilize the remaining trees. Sawmills and plywood factories turn about half of the raw material into final products; sawmill waste, i.e. chips, is sold to pulp and paper mills, whereas bark and sawdust are used for energy recovery.

One method of exemplifying the importance of the forest industry to the Finnish national economy is to refer to its export value. Finnish export has relied heavily on forest industry products: as late as 1970, roundwood and forest industry products constituted more than half of Finland’s total export of goods. Today, forest industry products still account for about 30 % of total exports.

Over the years, Finland’s foreign trade has grown more varied, and forest industry products are now rivaled by products of the metal and electronics industries.

In 2000 the export value of forest industry products was 68.2 billion Finnmarks (EUR 11.47 billion). About 80 % of this sum was brought in by pulp, paper and paper products, and 20 % by timber and wood products.

Industrial Values
Fig. 3 – Forest industry GDP share and jobs


Production has become more diversified, and the degree of processing is higher. The export of printing and writing paper has grown rapidly since the mid-1970s, while the export of newsprint has remained more or less at the same level. The import value was 7.1 billion Finnmark. Most of it was roundwood, wood residues, and sawn goods.

Forest industry production has a remarkably high degree of domestic origin. The industry’s primary raw material, wood, is mainly of Finnish origin as is the energy. On average, only around 16 % of production needs have to be met by imports.

Global roundwood production in 1997 (million m3 under bark):
Industrial wood 1 525
Fuelwood & charcoal 1 857
1 857
Hardwood 2 266
Softwood 1 116
3 382

The total value of the global export trade of forest products amounted to US$ 136.3 billion (f.o.b) in 1997, of which Finland’s share was 7.6 %.

The accrued income from logging and forest haulage contracts contributes more than one billion Finnmarks (EUR 168 million) to the Finnish national economy. Much of the harvesting is carried out mechanically, and only some thinning and felling for special purposes is done manually. Forest industry companies generally buy their timber as standing sales, i.e. the company takes care of the logging. The forest owner can also opt for delivery sale, carrying out the felling himself and delivering the timber to a roadside landing.

In Finland, logging is based on the so-called assortment system. This means that a tree trunk is cut immediately after felling into saw-timber and pulpwood, based on its quality and diameter. The butt end of a large tree gives about 2 or 3 logs which can be used for saw-timber, whereas the top is used for making pulp and paper. The thinnest part of the tree top can be used for energy.

Roundwood transports constitute a major part of all haulage on Finnish roads. Haulers and their employees transport about 60 million tons of timber annually, and for this, the forest industries pay more than one billion Finnmarks (EUR 168 million). Timber is also transported using waterways and railways, to the total value of about 300 million Finnmarks (EUR 50 million) annually.

Product Development Gives Added Value

Product Development Gives Added Value

There are more than 150 industrial sawmills in Finland and thousands of small gang mills. The total annual production of sawn wood is more than ten million cubic meters. The largest sawmills are truly high-tech, almost all automatic. They export three-quarters of their production. Small and medium-sized enterprises produce timber mainly for the domestic market. Their primary raw material is spruce or pine. Nowadays, sawmills can process smaller logs than before, and the raw material is used with better efficiency.

There are 16 plywood factories in Finland. They use birch and spruce logs as raw materials. Birch is used, for example, for high-quality plywood for airplanes. Other products of the wood board industry are chipboard and fibreboard. There are four chipboard factories in Finland and two fibreboard factories. Their products are sold mainly on the domestic market.

Forest industry production in Finland in 2000
Coniferous sawwood (est.) Unit 1000 2000
Plywood cu mtrs 13320
Chemical pulp cu mtrs 1167
 – softwood bl.
 – hardwood bl. tons 7101
Other pulps tons 3496
tons 2898
TOTAL PULP tons 4810
Paper tons 11910
 – Newsprint
 – Other Printing&Writing; paper tons 10758
 – Mechanical P&W; tons 1394
 – Woodfree P&W; tons 8354
 – Kraft paper tons 5348
– Other paper tons 3005
Paperboard tons 528
tons 483
TOTAL PAPER tons 2751
tons 13509

Source: Finnish Forest Industries Federation

The mechanical wood processing industry accounts for about one-fifth of the total export value of manufactured wood. The objective is to advance the degree of processing within the sawmill and board-manufacturing industries and thus increase the export value of products. Examples of highly developed products are laminated timber, special veneer, thermo-treated wood, and components for the furniture industry. The chemical wood processing industry uses smallwood from logging plus chips from sawmills and recycled fiber. In Finland, the industry is highly integrated: next to the pulp mill normally stands a paper mill that refines the pulp into paper.

The raw material used in pulp and paper mills is mainly pine, spruce, and birch, and nowadays also aspen. Softwoods give the long-fiber pulp or groundwood pulp needed for the production of newsprint. Printing and writing paper are today the central products of the Finnish chemical wood processing industry. Shorter hardwood fibers, for example, birch, have proven to be suited to the production of these papers.

Finns have recycled paper waste since the 1920s. Today more than 60 % of paper consumed is recovered and recycled. As only one-tenth of the production of the chemical wood processing industry is consumed domestically and most is exported to Europe, Finnish forest industry companies have founded plants using recycled fiber pulp in various European countries.

The Forest Cluster – a strong concentration of industry know-how


A cluster enterprise offers expert services, makes forestry-related machines or parts thereof, produces chemicals, or offers services related to forestry work or transportation. The Forest Cluster also includes producers of forest industry chemicals, automation enterprises, packaging and printing, energy producers and logistics companies.

In the early 20th century, the Finnish forest industry depended almost completely on foreign manufacturers of machines and equipment, although there was some domestic metal industry that could cater to the forest industry. After the end of World War II, the metal industry’s production gained momentum and variety due to the war reparations. The production of machines and equipment became more diversified and know-how rose to an internationally competitive level. Today almost one fifth of the metal industry’s production consists of machines and appliances for the Forest Cluster. The cooperation and partly joined product development between the forest and metal industries have given both parties a competitive edge, making many of their products world market leaders.

The turnover of the Forest Cluster is roughly 140 billion Finnmarks (EUR 23.5 billion); forestry contributes 10 billion Finnmarks (EUR 1.7 billion), the forest industry 100 billion Finnmarks (EUR 17 billion), and machines and other equipment 30 billion Finnmarks (EUR 5 billion). Forestry and the forest industry employ about 100,000 people, the rest of the cluster about 50,000 people. The Forest Cluster’s share of Finland’s GDP is about 10%, industrial production 30%, and of the export income nearly 40 %. The average annual increment of the Forest Cluster is 3-4%.

One of the strengths of the Forest Cluster is its wood supply which is based on family-run forestry. The competitive power of the Cluster is based on the interaction between its various sectors and businesses as a source of knowledge, skills, innovation, and development. Thus the Forest Cluster is one of the strongest concentrations of Finnish know-how. Research and training, which constitute a fundamental part of the Cluster, are important for its innovative and developmental power. The total input of the Cluster into R&D; is substantial, about 1.5 billion Finnmarks (EUR 250 million).

Wood – ecologically sound energy


One of the objectives of Finland’s National Forest Program 2010 is to increase the consumption of wood for energy by 5 million cubic meters annually. Ecologically, wood is a fairly unproblematic energy source, which in every way boosts sustainable development. Wood is a renewable natural resource, which when burnt does not cause many harmful emissions. The carbon dioxide released when burning wood is taken up by the growing forests. Wood as fuel also helps us to avoid fossil fuels. The ashes and its nutrients can be returned to the forest.

At present, about 20% of the total energy production of Finland is based on wood, which is a high figure in terms of global comparison. The industry produces about 80 % of wood energy by burning black liquor, a by-product from pulp mills, and sawdust and chips from the wood processing industry. As far as energy is concerned, pulp mills are completely self-sustaining and even able to supply other plants with energy.

Households and small heating plants produce about 20 % of wood energy. They use primarily Smallwood from thinning, chips made out of logging waste, and building waste. Some forest owners sell wood energy. They may, for example, supply the energy wood needed for the heating of the village school plus take care of the heating as well.

Finnish forests still play an important part for Finland as producers of renewable raw material, wood. The raw-material value of the volumes harvested annually varies from 6 to 10 billion Finnmarks (EUR 1-1,7 billion). Roughly 80 % of this sum is returned to the private persons and families who own the forests.

Sustainable and financially sound family forestry

family forestry

Most of Finland’s forests are owned by private citizens; private forest owners number more than 400,000. Counting their family members, about one million Finns can be estimated to be forest owners either directly or indirectly. Finnish forestry is commonly termed family forestry: small-scale forestry run by ordinary families, focusing on maintaining the chances of future generations to use the forests.

Changes in society, such as urbanization, cause changes in forest ownership as well. An increasing number of forest owners are city or town inhabitants and live on paid wages or a salary. The number of women among them is also growing. The forest owners’ ambitions in relation to their forest holdings vary greatly. For some, the forests provide work and income; others use their forests mainly for recreation or investment purposes. Nevertheless, most forest owners wish to reconcile several objectives.

About 60 % of all Finnish forests are owned by private persons or institutions, whose role from the point of view of the forest industry’s timber supply, is all the more important as they control more than 80 % of the industry’s raw material.

Private forest holdings are usually quite small, on average 20-30 hectares. Still, for many forest owners, forest earnings play an important part: an average forest holding under sustainable management may return an annual timber-sales income of about 15,000-20,000 Finnmarks (EUR 2,500-3,300). By carrying out the harvesting himself, the forest owner may receive a substantial income. Many forest owners carry out a major part of the forest management work on their holdings, such as planting and young stand management, themselves.

Logging, where larger volumes are harvested at one go, is usually carried out every 3 to 4 years. There are about 100,000 timber sales deals made every year between forest owners and forest industry companies. The average sales volume is about 500 cubic meters.

Finnish forest owners have easy access to expert advice relating to the management of their forests. There are about 250 Forest Management Associations that provide the forest owners with advisory services relating to forest management and felling as well as other types of related services. The association’ task, stipulated by law, is to promote private forestry while securing its economic, ecological, and social sustainability. The expertise of the Forest Management Associations is guaranteed by their trained personnel.

The operations of the Forest Management Associations are financed by the forest owners. The right of decision lies with the board which the forest owners have elected from among themselves. The forest owners pay an obligatory forest management fee, which depends on the size of the holding and the current price level for timber. Forest management fees make it possible to provide instruction at reasonable prices, and to assist forest owners in the planning of logging and timber sales. When needed, the Associations also provide help with planting or young stand management. These services are subject to a charge.

Financially sound forestry makes good forest management

In addition to logging, forestry includes forest management and improvement work. More than one billion Finnmarks (EUR 168 million) is invested every year in forest regeneration, young stand management, fertilizing, improvement ditching, and constructing forest roads. About three-quarters of this is financed by the forest owners themselves and the rest is covered by state subsidies. The State supports those forestry investments which would not immediately profit an individual forest owner but which are, nevertheless, desirable from the point of view of national economics.

The value of roundwood, logging, forest management, and improvement work, and haulage accumulate to an annual cash flow of about ten billion Finnmarks (EUR 1.7 billion). As such, this does not amount to a large proportion of the total national income but its multiplied impact is considerable. Forestry employs more than 20,000 people, to which is added the labor input of the numerous private forest owners. Forestry income also creates job opportunities in other sectors, especially various services.

Although Finnish forests grow quite slowly, forestry is still economically worthwhile. According to researchers, the annual net income in southern Finland is 500-600 Finnmarks (EURO 84-100) per hectare.