Forest sector in economy

Forest sector is of key importance to Finland.

The term forest sector means forestry and forest industries combined. In economic terms it makes particular sense to consider the Finnish forest sector as one entity, because forestry and the industry within Finland are very closely intertwined: neither of them could exist without the other.

Forest industries are the key to forestry’s profitability in Finland. They guarantee a reliable buyer for the timber grown. On the other hand, forest industries could not survive without profitable and productive forestry, the producer of their main raw material.

Sometimes forest sector can also include a larger entirety: services provided to forest owners and forest-related turism.

The forest sector is one of key supporters of Finland’s economy. In 2011 it employed directly about 70,000 people in Finland, which was 2.8 percent of all employees. One fifth of Finland’s export income comes from forest industries. More than 60 percent of the value added generated by the forest industries came from pulp and paper industries and the rest from wood products industries in 2011.

Regionally, the importance of the forest sector is largest in southeastern corner of Finland and in Etelä-Savo and Central Finland regions, where the sector produces some ten percent of the regional GDP. The importance of the different sub-sectors of the forest sector also varies with the area. The significance of forestry is largest in Etelä-Savo and Kainuu in eastern Finland.

Only sector that is viable on world market everywhere in the country

The forest sector and the food production sector are the two industry and production sectors which have combined primary production in homeland with industrial production. Their difference is that forest sector does need any substantial state subsidies. The forest sector is the only manufacturing branch, which is viable, self-supporting and survives in world market in all areas of Finland.

In 2013 Finland had around 70 pulp, paper and paperiboard machines in operation in nearly 50 mill sites. Im addition, there where about 200 sawmills, which production was mainly exported.

Nearly all the raw material and the majority of energy used in forest industries are domestic. In 2011, the forest industries bought timber from family forest owners for some 1.5 thousand million euros. This money was spread to hundreds of thousands of families owning forest across the whole country: two thirds of the money procured for families by selling timber stays in the very same municipality, where the forest are located. Also, the state and the forest indsutries got about 329 million euros for selling timber.

The forest sector has also led to the creation of other industries and economic activity in Finland, such as the manufacturing of paper and forestry machinery, and an extremely diversified sector of engineering, consulting and expert activity. These together with forest sector are caleld the forset cluster.

Updated on the 30th of December, 2015.

Slides produced by the Finnish Forest Foundation: Economic and social significance of forest sector in Finland


Added files

  • Economic significance of the forest sector

    Economic significance of forest sector in Finland

  • ff_graafi_eng_Metsasektorin_nettovientitulo-osuuden_kehitys_2015

    The net export revenue share of forest sector in Finland in 2000-10

  • Volumes and values of forest products in 2012

    Volumes and values of forest products in 2013 in Finland

  • Finland and her forests in a nutshell

    Finland and her forests in a nutshell

  • Share of bioenergy (%) in energy consumption in Finland

    Share of bioenergy in energy consumption in Finland