If the measures proposed are realised, the average size of forest holdings should increase and the profitability of forestry improve, while the supply of wood for the needs of the forest industry would also grow.
The measures the working group is proposing are fair and should be implemented without delay. In addition, it is important that forest owners are encouraged and steered to adopt active forestry practices through economic incentives.
As is being proposed by the working group, it is important to adopt several concurrent steering mechanisms to enable the faster realisation of vital changes. Taxation and legislation should be used to halt the fragmentation of forest holdings, increasing their average size to a level that enables active and professional forestry practices.
Bolder follow-up measures will also be needed to turn round the decline in the average size of forest properties. The identification and adoption of new measures calls for unbiased thinking and close cooperation between different involved parties.
Earlier generational transfers would prevent the fragmentation of forest holdings
The supply of wood must be safeguarded by promoting earlier generational transfers of forest properties in a manner that decreases the average age of owners and helps retain larger holdings in one piece. Possible alleviations to inheritance and gift taxes should come with the condition that the forest property is transferred to a sole owner and retains a sufficient size.
Sole ownership of a forest property is conducive to an active approach to forestry and increases also the offering of forestry services and the amount of enterprises.
Joint ownership of forests and forest leasing to boost the size of properties
Joint ownership is an effective mode of forest ownership. The creation of jointly owned forest holdings should be promoted by, for example, converting estates of the deceased into jointly owned forests if a sole owner to the forest property can’t easily be decided.
Jointly owned forests are required to draft a forestry plan, which means that they are more actively utilised than properties owned by estates of the deceased. Decisions on how to utilise jointly owned forests are taken by majority rule.
Forest leasing should be developed as a fast-acting measure because the structural change in the ownership of forest holdings and growth in the average size of forest properties has otherwise been too slow. The average farm size has grown thanks to the leasing of fields to active farmers, and these positive experiences should be taken advantage of when developing forestry as well. Forest leasing could also lead to an increase in forest entrepreneurship and establish a broader foundation for forestry business activities, which would promote the market entry of wood.
Steady market supply of wood essential to the industry and a prerequisite to prosperity
Increasing the forest utilisation rate and ensuring the supply of wood to the industry has substantial positive effects on employment, export revenues and the amount of taxes the State collects. A fundamental prerequisite of forest industry production is the steady supply of competitively priced wood to manufacturing facilities. Confidence in the availability of wood is also a significant factor when future investments to Finland are considered.
Anu Islander, Senior Adviser (Forestry), Finnish Forest Industries Federation, tel. +358 9 132 6678, +358 40 729 3678