Wood imports and the exports value of forest industry decreased in 2022

The forest industry’s foreign trade was affected especially by Russia’s invasion of Ukraine and its economic impact last year. The volume of wood imports dropped to 5.5 million cubic metres, decreasing by more than a half from the previous year. Forest industry exports from Finland decreased in real terms by 8% to EUR 14.6 billion.

A total of 5.5 million cubic metres of roundwood and forest industry by-products was imported to Finland, which is 56% less than in the previous year. The war in Ukraine significantly changed wood trade in the Baltic Sea region and the flows of foreign wood into Finland. Previously, Russia was the most important source of foreign wood for Finland, but imports from Russia ended last spring.

“Before the war, Russia’s share had been approximately three quarters of wood imports, but in 2022 it was 27%. The shares of Estonia and Latvia increased to slightly more than a fifth, while 18% of wood came from Sweden. Batches of wood were also imported from Latin America and Africa,” says Eeva Vaahtera, senior statistician at the Natural Resources Institute Finland (Luke).

The war in Ukraine increased the import prices for pulpwood and chips

Of the wood imported in 2022, 56% was pulpwood, 28% chips and 2% logs. The rest consisted of forest industry by-products (wood pellets, sawdust, etc.) and fuelwood.

Wood import prices began to rise. Depending on the tree species, an average of EUR 64–71 per cubic metre was paid for pulpwood at the border, which is in real terms 19–62% more than in the previous year (deflated using the wholesale price index, 1949=100).  The price of birch pulpwood increased most. However, the prices remained below the peak figures of 2008, which were partly due to an increase in wood export customs duties imposed by Russia. At that time, the real price of pulpwood increased to more than EUR 80 and of chips to more than EUR 70 per cubic metre.

In 2022, the real unit price of wood chips increased by 40% from the previous year, ending up at EUR 67 per cubic metre on average.

“Wood exports grew by 45% from the previous year to slightly more than two million cubic metres in 2022. Neary three fourths of wood was exported to Sweden, 7% to Estonia and 5% to Poland,” Vaahtera continues.

The annual value of wood exports grew in real terms by 23% to EUR 154 million. The most exported wood was pine logs, birch pulpwood and pine pulpwood. However, the prices of pine logs and pine pulpwood, decreased from the previous year in real terms. The average export price for pine logs was EUR 70 per cubic metre (−7% from the previous year) and for pine pulpwood EUR 85 (−22%). By contrast, the export price of birch pulpwood increased to EUR 60 per cubic metre (+3%).

Paperboard the most important export product

The forest industry accounted for 18% of the total value of Finland’s goods exports.

The value of exported forest industry products totalled EUR 14.6 billion in 2022. Due to high inflation, this was 8% less than in the previous year in real terms, even though the nominal export earnings increased. The most important product group for exports was paperboard, which accounted for 27% of the forest industry’s export earnings. Paper and pulp covered approximately a fifth each, and the share of sawn goods was 18%.

The wood-products industries’ export earnings were EUR 4.1 billion, which was 12% less than in the previous year in real terms. A total of 8.5 million cubic metres of sawn goods were exported. Even though the volume was only slightly lower than in the previous year, the real value of sawn goods exports decreased by 17% to EUR 2.6 billion. The export volume of plywood decreased by 6% to 0.9 million cubic metres, while the value of the exports increased by a couple of per cent.

Paper export prices increased but the export volumes decreased

The export earnings of the pulp and paper industries decreased by 6% in real terms to EUR 10.5 billion. Bleached sulphate pulp became the most important export product with a share of 18% in the value of forest industry exports. Its export value remained at EUR 2.6 billion, even though the volume decreased by 7%. The second place was taken by the paperboard industry’s multilayer coated cardboard and paperboard, which were exported for a value of EUR 2.3 billion (in the statistics, “other coated paperboard”). Their share in the total value of forest industry exports was 16%.

The export volumes of paper continued to decline, but the increased demand resulted in higher export prices. The volume of magazine paper exports decreased by more than a quarter, but the value only dropped by 6% as the export price increased by more than a quarter. The export price of fine paper increased by more than a third in real terms. However, a considerable decrease in the export volume, over 40%, resulted in a decline of more than a fifth in the value of fine paper exports.

Forest industry’s most important trading partners located in Europe

Of the forest industry’s export earnings, 60% came from Europe and 21% from Asia. The most important trading partners were Germany (12% of export earnings), China (9%) and the United States (8%). Exports to Germany and the United States consisted mainly of paper and paperboard products, while exports to China included mainly bleached sulphate pulp.

Forest industry products were imported to Finland for EUR 1.8 billion, which was 6% less than in the previous year. The most important import countries were Sweden (19% of the import value), Estonia (15%) and Germany (10%). Because of sanctions, Russia dropped from the top three to fifth place. Among other products, paperboard - and pulp industries’ products were imported from Sweden to Finland. Exports from Estonia mainly consisted of products of the wood-products industries, such as furniture. Converted paper and paperboard and paperboard products were imported from Germany.