Wood trade decreased by 12 per cent in 2022 – the highest price increase was recorded for birch pulpwood

According to statistics from the Natural Resources Institute Finland (Luke), the nominal average prices of all log and pulpwood assortments purchased from non-industrial private forests increased markedly in 2022. However, because of exceptionally high inflation, the prices of industrial roundwood increased by only one per cent on average in standing sales and by two per cent in delivery sales from the previous year in real terms. In energywood trade, the average price of stems increased by 30 per cent in standing sales and by nine per cent in delivery sales. The price of pruned stems increased significantly towards the end of the year.

The Russian attack on Ukraine, accelerating inflation, the rapid rise in interest rates and the threat of a recession affected demand for and the production of forest industry products in 2022. The impacts varied between sectors. Having declined, prices of sawn goods increased again during the first half of the year but began to decrease in the summer. The market situation for the main product groups of the pulp and paper industry was good for producers, and the export prices of pulp, magazine paper, fine paper and paperboard, for example, increased or remained at a good level. The market situation was reflected in wood trade and felling volumes in Finland. 

The highest price increase for birch pulpwood

The average price paid for spruce logs purchased from non-industrial private forests in standing sales was EUR 71.3 per cubic metre, and the average price paid for pine logs was EUR 67.0 per cubic metre in 2022. At the annual level, the average prices were one per cent higher than in the previous year in real terms, although the prices of softwood logs began to decrease in the summer, having increased rapidly during the first half of the year.

In standing sales, the average price paid for spruce pulpwood was EUR 21.9 per cubic metre, and the average price paid for pine and birch pulpwood was EUR 19.8 per cubic metre. Average pulpwood price level increased by one per cent from the previous year.

"Roundwood imports from Russia ended in the spring of 2022, and this increased the price of birch pulpwood in particular. The average price of birch pulpwood in standing sales increased by four per cent last year in real terms, while the prices of spruce and pine remained roughly at the previous year’s level", says Jukka Torvelainen, senior statistician at Luke.

Average pulpwood prices in delivery sales increased by four to five per cent in real terms at the annual level and ended between EUR 35.6 and 36.7, depending on the tree species.

High inflation reducd the increase in prices in real terms

Wood prices are recorded in Luke’s statistics database at the nominal prices, or fair prices, valid at the time in question. However, in texts and graphs, price changes are examined in real terms. Past nominal prices are converted into real prices by means of the cost-of-living index. This makes the converted prices comparable, and the impact of inflation makes them higher than the nominal prices. 

The average prices of all assortments in standing and delivery sales in 2022 were higher than the nominal prices of the previous year. However, the increases in real terms were markedly smaller than the nominal changes.

"Before 2022, inflation remained low for a long time, and the difference between nominal and real price changes was relatively small at the annual level. However, last year, the annual inflation rate increased to seven per cent, and the purchasing power of money decreased more rapidly than usual. For example, in the standing sales of softwood logs, the nominal price increase of EUR 5, or eight per cent, was one per cent in real terms", says Torvelainen.

Wood trade decreased from the previous year's peak levels

Last year, a total of 42 million cubic metres of industrial roundwood purchased from non-industrial private forests was recorded in the wood trade statistics. The volume decreased by 12 per cent from the previous year and was three per cent below the average for the previous five years. Log trade decreased by 17 per cent at the annual level, and pulpwood trade by seven per cent.

Of all assortments, spruce logs were purchased most, accounting for a quarter of the total wood trade volume. Pine pulpwood accounted for less than a quarter, and pine logs for a fifth. Log trade decreased considerably from the exceptionally high level of the previous year. However, the combined volume of logs and small-diameter logs remained slightly higher than the volume of pulpwood.

The price of pruned stems increased significantly

The warm weather in early 2022 reduced the demand for Finnish energywood, but the increase in the prices of energy and emission allowances, for example, as well as the end of wood imports from Russia, increased demand.

Energywood trade recorded in statistics continued at a good level, although it decreased by three per cent from the record levels of the previous year. In the most important energywood assortments, the volume of logging residues increased by 16 per cent, while the volume of pruned stems decreased 19 per cent. It is good to keep in mind that energywood trade and the felling and use of energywood were at a record high in the previous year.

Of all energywood purchased directly from forests, logging residues accounted for slightly more than 50 per cent. The average price of logging residues was EUR 4.8 per cubic metre in standing sales and EUR 19.3 per cubic metre in delivery sales. The price decreased by seven per cent from the previous year in standing sales in real terms and increased by four per cent in delivery sales.

The share of pruned stems decreased slightly to two fifths. The average price increased to EUR 7.1 per cubic metre in standing sales and EUR 32.0 per cubic metre in delivery sales. At the annual level, the increase was 30 per cent and nine per cent respectively.

"The prices of pruned stems increased rapidly and were exceptionally high during the last quarter of 2022. In standing sales, the price was EUR 13.7, which is 2.4 times higher than the previous year’s average in real terms. In delivery sales, the price was 1.2 times higher, at EUR 36,7", says Torvelainen.

Background to the statistics

The prices presented in the statistics are based on prices recorded in wood trade agreements between wood buyers and sellers. Any other increments and services related to wood trade are not included in the statistics.

Information for the statistics is collected from the largest wood buyers and from forest management associations. As the information is not rounded up to correspond to the total non-industrial private wood trade in Finland, the published wood volumes represent around 90 per cent of the wood purchased by forest industries from non-industrial private forests.