Installation of wooden wall elements for a private single house.
Maintenance of the economic viability of
forestry (B.8)
Economic viability is a basic requirement of sustainable forest
management. Without an economically viable forest economy,
there can be no ecologically or socially sustainable forest management,
either. Unlike in many other European countries, in
Finland wood of all forest products has by far the most important
effect on the economic viability of forestry. Forest industry
products account for almost 20% of Finland’s total exports.
The key factors affecting the economic viability of forestry are
the market price of timber and sales volumes. Because most of
the production of the Finnish forest industry is exported, the
domestic market for roundwood is dependent on the international
demand and prices for the exported products. The price
of roundwood is also affected by the volume and price of imported
roundwood.
Profitability can be improved by exploiting the current logging
potential, by carrying out timely forest management works, by
developing the methods available for forest management and
improvements, by promoting competition in the forest-based
services market, and by chaining forest management and logging
sites. Forest advisory services aim to ensure that this is the
case. Moreover, the recommendations for commercial forest
management have been reviewed and rotation recommendations
have been revised to improve economic viability.
The key objectives of Finland’s National Forest Programme
2015 include strengthening forest-based business and increasing
the value of production, as well as improving the profitability
of forestry. The selection of means is extensive, ranging from
measures aiming at increasing the size of holdings to developing
business skills of entrepreneurs.
The Strategic Programme for the Forest Sector (MSO 2011–
2015) supports the objectives of the NFP 2015 with, for example,
its development measures for enhancing the competitiveness
of domestic production in Finnish forestry and the forest
products industry, and for enhancing the business opportunities
and business expertise of the forest cluster.
Since the economic viability of forestry is vital to the maintenance
of habitation, employment and entrepreneurship in rural
areas, forestry is supported by several measures in regional
policy. Entrepreneurial operations are encouraged by taxation
and by granting start-up subsidies to new businesses. Regional
activities in forestry and the wood sector are also supported
through the structural funds of the European Union and by the
Centre of Expertise Programme.
Forest owners can also improve profitability by performing management
works on their own holdings. Increasing the use of
wood for energy also help to improve profitability. The government
can affect the economic viability of forestry with support
and taxation measures. Under the Act on the Financing of Sustainable
Forestry, private forest owners are eligible for public
funding for silvicultural and forest improvement works. The funding
is justified by the social benefits gained from supporting the
least profitable long-term investments of private forestry and
from joint projects of forest owners.
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