European Forestry Pulse #38 🌲

Hello,

Parliament voted yesterday. 402-250 in favor. The EUDR delay to December 2026 is now official—pending final trilogue approval before Christmas. Review clause added. Simplifications coming April 2026. The regulatory chaos we covered Tuesday just got resolved.

But timber markets remain broken. Germany hits €130/m³ for spruce—35-year high. Austria sees "extremely brisk" demand at €122/m³. Finland's trade collapsed 42% despite prices 55% above 2022. Poland up 16% in Q3. Markets aren't adjusting. They're fragmenting.

Here's what's moving European forestry this week:

European timber markets aren't functioning. They're fracturing into regional realities that make planning impossible. Record highs meet historic lows. Supply crises meet demand collapses. Forest owners in one country can't deliver logs while neighbors 200 kilometers away face bidding wars.

Germany: €130/m³ and existential warnings

Bavarian spruce sawlogs hit approximately €130/m³ in October—nearly 40% higher than the same period last year. The highest prices in 35 years. But this isn't health. It's crisis.

German sawmills face massive capacity cuts, with up to 95% of cutting capacity affected by production curtailments and short-time work as of late September 2025. The industry faces its lowest production year in recent history. 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. Bad weather rendered forest roads temporarily impassable across Central Europe in October. Logs sat roadside, unable to reach mills that couldn't afford to run them anyway.

The German Timber Trade Association warned of an "existential crisis" by 2026. Mills face short-time work. The business model is broken.

Austria: Thriving at €122/m³

Austrian spruce sawlogs reached €115-118/m³ for A/B grade timber in October. Tyrol B/C grade hit €120.08/m³, up 1.9% from previous period. Larch reached €145.77/m³. Demand described as "extremely brisk" despite exceptionally low supply. Buyers compete for scarce material. The Austrian market functions—barely—through fierce competition for limited volumes.

Finland: 42% collapse despite high prices

Finland's forest industry purchased only 4.8 million cubic meters of wood from privately-owned forests in Q3 2025 (July-September). That's 42% less than Q3 2024. Roughly one-third below the five-year average.

The paradox: Prices remain at historically high levels. Conifer log prices are approximately 15-20% higher than 2022 averages. Birch log prices increased roughly one-third since 2022. Pulpwood prices average approximately 50% or more above the same period. High prices with collapsing volumes signals something broke in the market. Mills can't afford to buy at these prices. Or forest owners won't sell expecting further increases. Either way, the Finnish timber market isn't functioning normally.

Poland: Up 16% in Q3

Polish timber prices rose 16% in Q3 2025 according to EUWID verified data. Spruce and pine sawlogs both increased. Central European market showing relative strength compared to Nordic collapse.

Why markets are fragmenting

Climate damage reduced available volumes unevenly. Beetle damage hit Germany and Central Europe hardest. Nordic forests remain largely intact but harvest activity collapsed. Construction demand varies dramatically by region. German residential building suffered worst from high interest rates. Italian imports hit records. Regional weather events block logistics in some areas while others operate normally.

EUDR compliance concerns affect small forest owners differently by country. German owners consider exiting. Finnish owners hold volumes expecting higher prices. Austrian markets see fierce competition despite concerns. Regulatory uncertainty compounds regional supply differences.

What this means for you

If you're a forest owner, high prices look attractive. But can you actually deliver logs? Will buyers still be solvent when you do? If you're a sawmill, buying at €130/m³ works only if you can sell lumber. Most can't. If you're planning 2026 operations, you can't use European averages. Your local market might bear no resemblance to conditions 200 kilometers away.

The European timber market as a unified entity no longer exists. It's a collection of regional markets with dramatically different dynamics. Plan accordingly. Sources: Timber-Online on Bavarian prices | GlobalWood on German crisis | YLE on Finnish collapse | EUWID on Polish increase

The European Parliament voted yesterday (November 26) in Strasbourg to approve the one-year EUDR delay. The vote passed 402-250, aligning with the Council's position from November 19.

New deadlines: Large and medium operators face December 30, 2026. Micro and small enterprises get June 30, 2027. Simplified requirements mean only operators who first place products on the market must submit due diligence declarations—downstream operators just verify and reference upstream statements.

Critical addition: The delay includes a review clause. The Commission must examine the regulation and report back by April 2026 with potential further simplifications. Final trilogue negotiations between Parliament and Council begin immediately. Both institutions must formally approve the final text and publish it in the EU Official Journal before year-end for the delay to take legal effect.

WWF strongly criticized the vote, calling it chaotic and irresponsible. The organization warned that what began as an IT issue has become an unmanageable situation requiring urgent Commission intervention to restore control.

The takeaway: EUDR December 2025 deadline effectively dead pending final approval. But April 2026 review means continued uncertainty about final requirements. Sources: Food Navigator | EUNews | WWF Statement | Bloomberg

The German sawmill industry is heading toward its lowest production year in recent history, with up to 95% of cutting capacity affected by production curtailments and short-time work as of late September 2025.

The German Timber Trade Association issued an explicit warning: The industry faces an "existential crisis" by 2026. Contributing factors stack up: severe construction slump in residential building due to high interest rates, fresh log supply constrained after beetle-damaged wood supply ended, and small forest owners considering harvest suspension to avoid EUDR compliance burden.

The crisis combines weak demand with supply constraints. Mills face high log prices but can't pass costs to customers in collapsed construction markets. Many operate on short-time work schedules. The business model is broken.

The takeaway: Germany's sawmill sector faces perfect storm of weak demand, supply constraints, and compliance concerns—existential crisis warning not hyperbole. Source: Forest Machine Magazine

The European Union submitted its updated Nationally Determined Contribution (NDC) to the UNFCCC on November 22, 2025. According to reporting on the submission, the EU is proposing to reduce net greenhouse gas emissions by approximately two-thirds by 2035 compared to 1990 levels, with targets in the high-60% range.

The submission emphasizes that the EU "is ready to further increase the level of its ambition" if climate finance support becomes available. The NDC explicitly references carbon credit integration strategies. Commission President Ursula von der Leyen stated: "With our updated NDC, the European Union is leading by example."

For forest professionals, this NDC sets the framework for national forest policies through 2035. Expect increased pressure on member states to demonstrate forest carbon sequestration contributions. Countries with declining forest carbon sinks face difficult choices around harvest restrictions or increased afforestation requirements.

The takeaway: EU's 2035 climate commitment will drive national forest management policies and carbon credit market development for next decade. Source: UNFCCC NDC Registry | Carbon Pulse reporting

John Deere announced November 21 the launch of its 1610G forwarder, strengthening the company's H Series forestry equipment lineup. The new forwarder features enhanced hydraulic systems and improved operator comfort designed for Nordic and Central European market conditions.

The launch signals continued equipment manufacturer investment in European forestry markets despite current sector challenges. John Deere positions the 1610G as addressing contractor demand for reliable, fuel-efficient forwarding capacity in challenging terrain.

The takeaway: Major equipment manufacturers continue product development for European forestry despite current market weakness—betting on long-term sector fundamentals.

Source: John Deere press release, November 21, 2025

Polish timber prices rose 16% in Q3 2025 according to EUWID verified data. Both spruce and pine sawlogs showed significant increases. The Central European market demonstrates relative strength compared to Nordic price pressure and German supply crisis.

Poland benefits from several factors: moderate beetle damage compared to Germany, functioning logistics networks, and stable domestic construction demand. The country avoided the extreme supply constraints affecting Bavaria while maintaining stronger demand fundamentals than Finland.

The takeaway: Polish timber market shows regional strength can persist despite broader European fragmentation—geography and local conditions matter more than continental trends. Source: EUWID Wood Products, Q3 2025 data

December 5, 2025: CITES COP20 concludes in Samarkand - timber trade regulation decisions

December 2025 (mid-month): EUDR trilogue negotiations expected - final delay approval

December 30, 2025: Current legally binding EUDR deadline (will be superseded if trilogue succeeds)

Calculate your regional price positioning before planning 2026 harvest. With markets fragmenting, European averages mean nothing. Your local reality matters.

Thirty minutes, critical planning:

If you're in a high-price region, selling now captures value before potential corrections. If you're in a collapse region, waiting might be fatal—buyers may exit before prices recover. If you're between markets, logistics capability determines whether you can arbitrage the price differences.

The European timber market as a unified entity is dead. Know which fragment you're in. Plan accordingly.

Until Thursday!

Wish you all the best: Peter

P.S. What’s the biggest challenge you’re facing in forestry right now?
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