Forestry as an investment 2021

The return on investment in wood production rose well above the five-year average. The return was boosted by the rise in wood prices, which has a large impact on the return index. Returns calculated without the effect of wood prices have also been rising.

• Investment returns on wood production were over 12% in 2021 in mainland Finland. Compared with the previous year, returns increased by 10 percentage points, while being 6 percentage points higher than on average during the previous five years.
• Returns on wood sales accounted for +3.8 percentage points of the returns and state wood production subsidies covered +0.1 percentage points. The increase in standing sales prices accounted the returns by +7.0 percentage points and the value of net increment of growing stock +1,5 percentage points. Total wood production costs reduced the returns by -0.5 percentage points.
• Studied by region, the returns were highest in Kainuu (18%) and lowest in North Ostrobothnia (9%).
• The change in standing sales prices increased returns in all regions. Highest it was in Kainuu (10%) and lowest in North Ostrobothnia and Satakunta.
• Net increment of growing stock had a positive impact on returns in every region. This means that the value of trees that grew in forests was higher than the value of trees felled.
• The return excluding the change in standing sale prices was 5.0%. This is more than one percentage point higher than 20 years earlier. The main reason for the increase was the rise in the value of the net increment due to the increase in the volume of the stand and the increased share of logs.
• In 2020, the value of stumpage value was around EUR 53 billion, rising to EUR 58 billion in 2021.

Background information on the statistics

Investment returns on wood production is an index of returns calculated on the basis of felling, standing sale prices, state subsidies to wood production, costs in wood production and stand data. In this calculation, income and expenditure are related to the stumpage value of the stand, which is calculated on the basis of standing sale prices and the volume of trees.

The data are based on Luke statistics and the National Forest Inventory (NFI) on forest land for wood production. For the 2019-2021 stand calculations, the results of the NFI measurements 2017-2021 were used. In the statistics, the last two years are preliminary data, as the new inventory data are used to refine the stand data in the calculation.

The change in monetary value has been made using the Cost of living index (1951:10=100).