Finnish Forest Research Institute  Metla

Press release 9.6.2006

Metla report on the future of the forest sector published

Forest sector could be driving force of bioeconomy

Finnish forest sector is at a critical watershed currently and in the future. The Finnish Forest Research Institute report shows that the forest sector can survive the changes and even become stronger as the result. The report outlines two alternative scenarios of the future for the next ten years, as well as three potential, sudden and major changes for which we should be prepared. Finally, means of how the scenarios might be realised are assessed. The report does not propose a single policy goal, but alternatives to aid political decision-making.

The Finnish Forest Research Institute (Metla) has prepared a report on the future of the forest sector at the request of the Ministry of Agriculture and Forestry. The report contains an assessment on the development of the operating environment of the forest sector to the year 2015, identifies alternative future scenarios, and gives a preliminary outline of the policy measures required for each of the scenarios. The Ministry of Agriculture and Forestry will use the report for its own review of the future and in revision of the National Forest Programme 2010.

Finnish forest sector is at a critical period, resulting from changes that have either taken place or are on the horizon in the global operational environment, Finnish national economy and society. Growth prospects for forest industry production located in Finland are weighted on products with a high added value and entirely new products. Profitability of current products is improved by increased efficiency and further development of technology. Overall, however, limits in production growth of present forest industry products have been reached in Finland, although turnover may rise.

Increasing production of bioenergy and bioprocess products provides the greatest opportunities of business expansion in the forest sector in the future, new jobs, export of technology and utilisation of forest resources. Forest-based bioenergy production and use will diversify. This will also enhance profitability of present forest industry production, because joint production is often the most efficient way of manufacturing new products. However, increased bioenergy use will cause added challenges to forest ecology and biodiversity.

Development of society in relation to e.g. diversification of structures of the economy, concentration of population in urban areas, and ageing, as well as values of new generations, leads to changes in the value weightings of different forms of forest usage. Importance of wellbeing of services related to forests and uses other than those related to wood production will continue to grow. Growth prospects of the nature tourism sector in Finland are largely based on increasing numbers of foreign customers. The main challenge related to recreational use of forests is balancing of supply and demand for recreational opportunities – the need for development of services particularly in the vicinity of large urban areas will grow. In order to safeguard forest biodiversity in Southern Finland, cost-effective ways of implementation are sought from various voluntary activities and restoration of existing conservation areas.

The scenarios outlined in the Metla report have been entitled the alternatives of ‘developing existing structures’ and ‘active change’. The first scenario finds the present structures good and safe, and there is no attempt to actively change them. Risks attached to change are emphasised more than those attached to current structures. To ensure the development of existing structures, rational and necessary adjustments will be made in response to changes in the operating environment and in line with relevant agreements (EU Directives, international and national agreements and obligations). The active change scenario is based on the view that many of the strengths that have shaped the existing structures and modes of operation are diminishing or no longer apply. Thus, the forest sector will invest in developing new products, services and business models. There will also be a readiness to take risks and to wait for results to materialise in the longer term.

Climate change, the world’s rapidly growing energy needs, interest in products based on renewable natural resources, and the importance of forests for recreation and health are all key forces driving change and will shape Finland’s forest sector operating environment in the decades to come. The forest sector has excellent potential for helping to generate additional prosperity and wellbeing, both material and immaterial, and with reduced strain on the environment. Finland will increasingly shift towards a bio-based economy, which is one of the fundamental pillars of sustainable development. From this perspective, the future challenges and opportunities for the Finnish forest sector appear encouraging. Nevertheless, utilisation of these opportunities demands significantly greater investment in forest research and development work than is currently available.

Safeguarding the vitality and wood production of Finland’s forests will be a key challenge for society in the longer term. If additional prosperity and wellbeing are to be generated from the country’s forest resources, it is important that these resources remain abundant and diverse. This will ensure that the availability of high-quality wood raw material can be secured for both the existing and future needs of the forest industry. At the same time, abundant and diverse forest resources will enable other forms of use that are important for the prosperity and wellbeing of society. Maintaining the vitality of the forests is also important in making provision for future environmental change, both foreseen and unforeseen.

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