The size and structure of forest properties in Finland affects the forest sector’s profitability. Problems with Finnish forest ownership include the small size of properties, the fragmentation of properties and the high age of forest owners. Furthermore, forests are also owned by estates, which are slow to make decisions and find decision making complicated.
All these factors combined cause problems for the entire value chain, the forest economy, industry’s wood procurement and thus the attractiveness of the entire sector and industry’s willingness to make investments are reduced.
Further fragmentation of forests threatens to accelerate, as baby boomers divest their forests and pass them onto their heirs. There is a need for policy instruments which reverse the trend of fragmented ownership, and increase the size of forest holdings.
Improved forest management is of national economic significance
In future, private forests must be managed in a more professional manner and in bigger units. Active forest management improves both the profitability and productivity of the forest economy. In terms of central government finances, increasing the utilisation rate of forests and securing the industry’s wood supply have significant positive effects on tax revenue, employment and export earnings. Change would also substantially improve conditions for investments in the wood processing industry in Finland.