Forest Products Industry

One of the key themes of the recent London Climate Action Week was mobilising public and private finance to support global climate goals and transitions, particularly in the lead-up to COP30. Source: Timberbiz To further this mission, 10 leading forestry companies announced they will come together to quantify and value a set of ecosystem services with the aim of building the foundation for an investible market. These entities own or manage millions of hectares of forests in 21 countries. The 18-month project, an initiative of the International Sustainable Forestry Coalition (ISFC), will be supported by Value Australia (part of the Capitals Coalition) and the Taskforce on Nature-related Financial Disclosures (TNFD). “The world must begin to increase investments with positive impacts on both climate and nature. However, if we are to attract the scale of funding required these investments must also make economic sense,” Independent Chair of the ISFC, Dr David Brand said. “The global forestry sector can deliver sustainable, renewable materials as well as positive outcomes for climate and nature. Central to this is standardising the accounting for the extensive natural capital assets managed by these companies. ISFC members wish to be at the forefront of this work and have therefore decided to come together to build out mutually supporting Natural Capital reports.” Mark Gough, Chief Executive Officer of Capitals Coalition said that the contribution that the forestry sector can make has often been undervalued. “The ISFC is stepping up to address this by working with the Capitals Coalition and TNFD to produce consistent accounts and disclosures that can reflect the true value of forestry.” Rayne van den Berg, Chief Value Officer at Value Australia which is a regional Capitals Coalition hub added that many individual companies and thought leaders have worked for years to develop frameworks and methodologies to quantify and value Natural Capital with the aim of providing better information for more informed decision-making. “This project will be a ‘game-changer’ as, for the first time, a collective of leading forestry companies will develop consistent reports for their most material ecosystem services and the approach taken to quantifying impacts and dependencies.” Tony Goldner, Chief Executive Officer of the Taskforce for Nature Related Financial Disclosures said that TNFD was pleased to support this collective effort as ISFC has been able tobring together an impressive range of forestry sector players prepared to work together for the good of nature and climate outcomes, balanced with delivering returns. “The TNFD framework, and the LEAP process, being adopted by enterprises all over the world, provides the frame of reference for this project. The missing piece of that puzzle has been the valuation of ecosystem services, which must occur if we are to pivot globally away from nature destructive investments to nature enhancing capital flows. TNFD will utilise the learnings from this project to help inform its guidance and to demonstrate the link between TNFD Nature-related assessments and Natural Capital Accounting for Valuation and presentation.”

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A major merger and acquisition (M&A) wave, conservatively estimated to exceed €450 million ($516 million) in deal value across European sawn timber markets including over €160 million in disclosed deals plus several large undisclosed transactions and recent distressed asset acquisitions signals a fundamental shift toward market concentration that could likely reduce pricing volatility while creating new competitive dynamics favouring integrated participants and Baltic production hubs. Source: Fast Markets The European sawn timber markets are experiencing unprecedented M&A activity spanning 2024-2025 while industry leaders race to secure scale and strategic positioning. The consolidation wave spans from Stora Enso’s €137 million acquisition of Finland’s Junnikkala, adding 700,000 cubic meters of capacity, to Austrian HS Timber Group’s aggressive Baltic expansion through dual Latvian acquisitions totalling 550,000 cubic meters combined capacity. Meanwhile, regional participants like Estonia’s Combiwood are making strategic moves, acquiring AS Toftan to create a €276 million revenue entity. Distressed asset opportunities have also emerged. The collapse of Germany’s Ziegler Group in late 2024 created significant distressed acquisition opportunities. Another German company, Rettenmeier Holding AG acquired substantial portions of Ziegler’s wood processing division in January 2025, taking over operations of Ziegler Holzindustrie GmbH & Co. KG and related companies, preserving nearly 770 jobs. Separately, Kronospan acquired ZG Timber’s Sebeș plant in Romania in March 2025, safeguarding 500 local jobs and expanding Kronospan’s product portfolio to include sawn timber for the first time. This flurry of deals, concentrated within an 18-month period from 2024 through early 2025, represents the industry’s response to margin pressures, supply chain uncertainties, and the need for operational scale in increasingly challenging market conditions. “The recent M&A activity in the sawn timber industry reflects a mix of motivations: while some deals were clearly opportunistic often tied to the downturn in the sawmilling business cycle in Europe and North America – others were more strategic in nature,” Alexey Beschastnov, senior manager at StepChange Consulting, said. According to Beschastnov, the opportunistic transactions are frequently linked to low profitability, insolvency risks, or distressed asset sales, creating acquisition opportunities. “Strategic acquisitions, in contrast,” he added, “are typically independent of the cycle and driven by long-term fit, wood supply security, or vertical integration goals—as seen in recent moves by Stora Enso and Kronospan.” The current consolidation wave, in fact, builds upon a decade-long trend of M&A activity that has steadily reshaped European timber markets. Key historical transactions set the stage for today’s aggressive deal-making and (for example in the Nordics) these included Binderholz’s acquisition of Finland’s Vapo sawmills in 2016; Canada’s Canfor, which acquired 70% of the Swedish company, VIDA in 2019, and recently increased its stake to 77%; and the Austrian major HS Timber (Group), which bought Finland’s Luvian Saha in 2022. This historical activity may have established the strategic precedent for vertical integration and scale consolidation that defines the current M&A surge. The current aggressive consolidation wave can potentially alter European timber supply dynamics. Binderholz’s emergence as the continent’s largest producer with 4.5 million cubic meters capacity across 15 sawmills creates unprecedented market influence. This scale advantage becomes critical as raw material costs remain elevated relative to sawn timber prices – a margin squeeze that has defined recent market conditions. Stora Enso’s €137 million Junnikkala acquisition exemplifies the vertical integration strategy driving deals. By securing 1.7 million cubic meters of additional wood procurement annually, Stora Enso insulates itself from log supply volatility while generating €15 million in synergies. (Incidentally, Stora is also reported to be considering a project to build what could be Finland’s largest sawmill in Imatra in southeast Finland). For traders, the vertical integration trend suggests tighter control over upstream supply chains, potentially reducing spot market availability of both logs and finished products. The distressed acquisitions add another dimension: opportunistic buyers like Kronospan are using market disruption to enter new product segments, while established participants like Rettenmeier consolidate their positions during competitor weakness. HS Timber Group’s dual Latvian acquisitions (Vika Wood and Kurekss) adding 550,000 cubic meters combined capacity signals Baltic states becoming Europe’s new production frontier. These facilities offer competitive labour costs, modern infrastructure, and crucially, Forest Stewardship Council (FSC)/Program for the Endorsement of Forest Certification (PEFC) certification meeting EU sustainability mandates. The strategic positioning could prove significant for European buyers. While Baltic mills face similar raw material cost pressures as other European regions, they have competitive advantages through modern, efficient facilities built or upgraded since the 1990s and strategic access to quality regional timber resources. Their geographic positioning provides optimal logistics for serving both European and global export markets spanning 30+ countries. For producers outside the Baltic region, this geographic shift could create competitive pressure. Mills in higher-cost jurisdictions must either consolidate for scale efficiencies or risk margin squeezes as Baltic capacity expands market share. The consolidation wave can help reduce extreme price volatility that has characterized recent sawn timber markets, although such volatility is also caused by shifts in global market dynamics. Larger, integrated players possess greater financial resources to weather demand fluctuations without panic selling. But this stability comes with trade-offs Fewer independent mills could mean reduced competition for log purchases, potentially moderating raw material price spikes that have been squeezing margins in several markets, notably in Finland and Sweden, where high log prices still prevail. Conversely, downstream buyers face fewer supplier options, particularly for specialized products or large-volume contracts. The timing proves strategic given that North American mill closures have continued to reshape supply dynamics in global markets. While significant mill closures have occurred across the US West and British Columbia – with over 1.7 billion board feet of capacity permanently or indefinitely shut since 2022, this has been partially offset by substantial new capacity additions in the US South. Since 2015, the US South has added approximately 8.0 billion board feet of new Southern Yellow Pine sawmill capacity, with companies announcing an additional 4.5 billion board feet to come online by 2024. But this regional shift from high-cost western regions to the more cost-competitive US South can still create opportunities for European consolidated participants […]

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Waratah Forestry Equipment recently introduced the new H427 harvester head at FOREXPO 2025 in Mimizan, France. Built for extreme forestry conditions, the H427 delivers strong performance, durability and precision for harvesting large timber on steep and rugged terrain. Designed for today’s demanding forestry jobs, Waratah’s H427 is a powerhouse built to handle big wood with confidence and control. Source: Timberbiz “The H427 is purpose-built to meet the demands of high-production harvesting in larger timber conditions,” said Brent Fisher, product marketing manager for Waratah. “Its design enhances operational efficiency, ensures long-term durability and simplifies maintenance, supporting reliable performance in the forest.” Featuring a top saw, strong frame and optional HD tilt frame, the H427 delivers reliable performance and productivity. Its high feed force and 760 mm (29.9 in.) maximum cut capacity make it ideal for harvesting large-diameter timber. Updated measuring systems improve length and diameter accuracy for efficient, high-output processing. With an operating weight from 1680 kg (3,704 lb.), the H427 offers agility with the durability and stability needed for the most demanding applications. Its efficient, powerful control valve and optimized four-roller feed arm geometry ensure consistent productivity on wheeled and tracked carriers. The four-knife delimbing system delivers consistent, clean results, while simplified service access and a streamlined design help reduce downtime in the field. The durable H427 offers long-lasting reliability in high-impact forestry applications. As with all Waratah products, the H427 comes with easily accessible support for dealers and customers, as well as genuine Waratah parts with an industry-leading warranty. The Waratah H427 will be available to customers in the United States, Canada, Europe, Australia, New Zealand, Africa, Brazil and Latin America starting in early 2026.  

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