Hello,
Austrian sawlogs at €118/m³. Bavaria hits €130/m³—up 40% year-over-year. Estonia sees pine up 15.6%, spruce up 17.8%. But German sawmills operate at just 5% of normal capacity. Construction permits have collapsed. Forest roads sit impassable from bad weather. Logs wait along roadsides, unable to reach mills that can't afford to run them anyway.
The European timber market is broken. High prices don't signal health. They signal crisis.
Here's what's moving European forestry this week:
🔍 The Big Story
Central European Log Prices Hit Records Despite Weak Demand
Log prices across Central Europe climbed to records in October 2025. But this isn't a demand story. It's a supply crisis meeting construction collapse. The price spike signals market dysfunction, not market health.
Austria: Spruce sawlogs reached €115-118/m³ for A/B grade timber in October. Demand described as "extremely brisk" despite exceptionally low supply. Buyers compete for scarce material.
Bavaria: Spruce logs hit approximately €130/m³ in October—nearly 40% higher than the same period last year. The highest prices in 35 years. Not temporary volatility. Structural shortage meeting construction collapse.
The supply bottleneck: Bad weather rendered forest roads temporarily impassable across Central Europe in October. "Log wood is lying along roads but cannot be transported," creating immediate shortages. Physical logistics failure drives prices up regardless of demand fundamentals.
The German crisis: German sawmills face their lowest production year in recent history. Up to 95% of cutting capacity affected by production cuts as of late September 2025. The contributing factors stack up: severe construction slump due to high interest rates, fresh log supply constrained after beetle-damaged wood depleted, and small forest owners considering harvest suspension to avoid EUDR compliance burden.
The paradox explained: Record prices usually signal strong demand. Not this time. They signal collapsing supply meeting collapsed demand. When supply falls faster than demand, prices rise. But mills can't afford to run. Forest owners can't deliver logs. Buyers can't find material. Everyone loses.
What this means for you: If you're a forest owner, high prices look attractive. But can you actually deliver logs through impassable roads? And will buyers still be solvent when roads clear? If you're a sawmill, buying at €130/m³ works only if you can sell lumber. Most can't. The business model is broken.
The 2026 question: Will supply recover? Only if weather permits harvest and forest owners don't exit the market due to EUDR costs. Will demand recover? Only if construction revives and interest rates fall. Both must happen simultaneously. Neither is guaranteed. Source: Timber-Online, GlobalWood Markets Info, Interior Daily
📊 Quick Hits
1. 🇫🇮 UPM Permanently Closes Kaukas Paper Machine
UPM concluded employee consultations on October 3, confirming permanent closure of Paper Machine 1 at Kaukas mill in Lappeenranta, Finland, during Q4 2025.
Impact: 220 jobs cut, 300,000 tonnes annual capacity removed. UPM shifts production to Rauma mill for cost efficiency. Pulp, sawn timber, biofuels, and R&D continue at the integrated Kaukas site. "Even in these difficult times, our skilled team at the Kaukas paper mill has ensured stable operations," said Matti J. Laaksonen, General Manager.
The takeaway: European coated mechanical paper consolidation continues as market fundamentals weaken. Source: UPM
2. ♻️ Valmet Earns Sustainability Certification for Finnish Production
BM Certification issued ISCC PLUS certification to Valmet's paper machine clothing production unit in Tampere, Finland, announced October 24. The certification enables bio-based raw materials in fabrics for pulp, board, paper, and tissue using mass balance approach. First product: press felts with bio-based polyamide achieving significant emission reductions versus traditional yarn. Valmet aims for lower greenhouse gas emissions and improved environmental performance across its paper machine clothing production. The company's Portugal facility (Ovar) also received ISCC PLUS certification in February 2025.
The takeaway: Pulp and paper supply chain pushes toward lower-carbon manufacturing with verified sustainability claims. Source: PaperFIRST.info
3. 🇩🇪 German Beech Log Exports to China Drop 10%
China's purchases of German beech logs decreased 10% year-to-date through Q3 2025. However, China's total beech log imports from all sources only fell 1% to 548,500 m³. Germany losing market share. China diversifying suppliers. Total Chinese demand remains stable.
The takeaway: German beech exporters face growing competition as China sources from broader supplier base. Source: Timber-Online
4. 🌱 Verra Updates Forest Carbon Methodology
Verra released Corrections and Clarifications to VM0042 v2.2 (Improved Agricultural Land Management) on October 10, with announcement October 20. Updates support alignment with Core Carbon Principles from ICVCM.
Key updates: added baseline scenario justification, modified additionality assessment, clarified conservative emission factors, recommended five-year baseline reassessment.
The takeaway: Forest carbon project standards tightening as voluntary market faces credibility pressure. Source: Verra
📅 The Weeks Ahead
November 2, 2025: Luxembourg PEFC consultation closes. Cross-border certification outcomes expected.
November 10-21, 2025: COP30 in Belém, Brazil. Forest carbon and REDD+ announcements expected from this "forest COP."
November 13, 2025: Forest Europe high-level dialogue on geopolitical emergency preparedness (online, 9:00-11:30 CET). Focus: forests' role in energy, food, transport during crisis.
November 19-22, 2025: Vietnam Wood Show in Ho Chi Minh City. Asia-Pacific export opportunities.
💡 One Thing to Try This Week
Map your log delivery routes before winter. With October's bad weather blocking forest roads and prices hitting records, logistics planning matters more than ever.
One hour, critical payoff:
Walk or drive your main extraction routes
Identify bottlenecks: narrow sections, poor drainage, weak bridges
Note three upgrades needed before heavy winter weather
When prices hit €130/m³ but you can't deliver logs, high prices mean nothing. The forest owners who can deliver when roads are passable will capture the price premium. Those who can't will watch from the sidelines.
Roads win markets.
Until Tuesday!
Wish you all the best: Peter
P.S. What’s the biggest challenge you’re facing in forestry right now?
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