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Towards a competitive and sustainable forest-based industry

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Towards a competitive and sustainable forest-based industry

The European Commission is presenting a plan of action to reinforce the competitiveness and sustainability of the forest-based industries to meet the economic and environmental challenges the European Union will be facing in the future, including climate change, innovation, increasing global competition and the supply of wood and energy.


Communication from the Commission to the Council and the European Parliament of 27 February 2008 on innovative and sustainable forest-based industries in the EU - A contribution to the EU's Growth and Jobs Strategy [COM(2008) 113 final – Not published in the Official Journal].


The European Union (EU) is home to a competitive forest-based sector, which has a turnover of around 365 billion euros per year and generates value added of around 120 billion euros. It employs more than three million people in 344 000 enterprises, many of them in rural areas. Small and medium-sized enterprises (SMEs) play an important role in the wood and printing sectors.

Whilst moving towards a low-carbon economy, the industries in the forest-based sector have to remain competitive. The sector must continue to prosper whilst tackling the issues of climate change, innovation, access to non-European markets and higher energy costs.

The Commission is proposing several measures to make the forest-based sector in the EU even more competitive, based on the following aspects:

  • access to raw materials;
  • combating climate change;
  • innovation, research and technological development;
  • trade and cooperation with third countries;
  • communication and information.

Access to raw materials

Increasing demand for raw wood for renewable energy, biodiversity requirements and recreation all lead to greater competition, and the gap between supply and demand is leading to higher costs. It is important to promote the domestic supply of unprocessed wood in order to guarantee availability. Wood, as a raw material, is the single largest cost for many industries in the forest-based sector, representing more than 30% of the total cost of paper production and almost 70% for sawmills.

The Commission advocates a sustainable management of forests. It encourages the Member States, industries and forest owners to:

  • promote tree planting and reforestation;
  • use biomass in a balanced way, not reserving it exclusively for the production of renewable energies, so as to ensure that the forest-based sector has a reliable supply of raw wood, thus bringing about a better match between supply and demand;
  • encourage the development of the recycled paper and wood markets, also by promoting the participation of the industry, with the aim of increasing the use of recycled paper and wood;
  • continue their efforts to reduce illegal felling and the sale of products derived from illegally felled wood.

Combating climate change

Forests and forestry products absorb carbon dioxide, and this carbon storage is the sector's contribution to combating climate change. More intensive recycling of wood and paper, rather than disposing of them in landfill, prolongs their ability to retain carbon. The Commission will be examining the advantages and disadvantages of the idea of including in its policy the storage of carbon in forestry products.

Higher gas and electricity prices are threatening the competitiveness of the forest-based sector. Even though some branches of this sector (e.g. plants for the manufacture of chemical pulp) are net producers of energy, others (e.g. paper plants) consume large amounts of energy. The Commission is focusing on the plan of action for 2007-2009 "An Energy Policy for Europe" with a view to creating a really competitive internal market in gas and electricity.

The Commission is focusing on future activities in the area of climate change and, in the context of the Community greenhouse gas emission trading scheme, will continue to evaluate the specific situation of energy-intensive industries and the risk of seeing production moved abroad to countries where the emission limits are less strict ("carbon leakage").


The Commission reiterates the importance of innovation, research and technological development to support the competitiveness and ensure the sustainable management of the forest-based sector. The 7th Research Framework Programme provides a framework for the study of biofuel and wood-based organic chemical production methods. An approach based on the establishment of innovation centres will be adopted with a view to promoting competitiveness within the forest value chain.

Trade and cooperation with third countries

The Commission will be continuing its efforts to guarantee access to raw materials on the world market and to eliminate tariff barriers. Dialogue with third countries will be launched to this end.

Information and communication

Awareness of forest-based products and the forest-based sector must be improved. The Member States, regional authorities, universities and educational institutions will be invited to work together in multinational networks to analyse and report on long-term changes in the sector.


All the proposed activities have been the subject of a public consultation. This Communication is a further step in implementing the EU's integrated industrial policy. It also complements the Forest Action Plan.

Last updated: 10.06.2008