Hello,

Last week we showed you the numbers. Tornator posted record profits. UPM, Metsä, SCA, and Billerud all lost money. The pattern was clear: owning forests pays. Processing wood doesn't.

But here's what kept me thinking all week. If forest ownership works this well — why isn't more money flowing in?

I went looking for answers. I found them in Copenhagen. And in my own LinkedIn comments section.

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

🔍 The Big Story

Europe's Best Asset Class That Nobody Understands

Europe's forests just had one of their best years as an asset class. Tornator's operating profit hit €168 million — an all-time high. Rayonier lifted adjusted EBITDA by 7.7% to $248 million. Forest land values keep climbing across Scandinavia and Central Europe.

Yet private investment in European forests remains tiny. Compare it to farmland, real estate, or wind energy. Forests barely register on most investor’s radars.

Why? Because there's a gap. A two-way gap. And it's costing the entire sector.

Forestry doesn't speak finance. Forest owners talk in cubic meters. They describe rotations, site indices, and thinning schedules. An investor hears jargon. They don't see a business case. They see complexity they can't model.

Most forest owners have never written an investor pitch. They've never framed biological growth as a return metric. They've never explained why a 60-year rotation isn't a risk — it's a feature.

Finance doesn't understand forests. Fund managers think in quarters. They want liquidity and exit options. A forest that grows 3% per year but gets harvested every few decades? Their models can't handle it. Their compliance teams don't know how to classify it. Their boards have never discussed it.

The result? Europe's best-performing natural asset class stays invisible to the people with the money.

Someone Is Building the Bridge

Anders Tærø Nielsen saw this problem and decided to fix it. He's the CEO of Remixed Nature, a Copenhagen-based company that manages forest investments for private clients across Denmark, Scotland, Finland, Latvia, and Estonia.

Anders holds a PhD in forestry and CO₂ from Copenhagen University. He advises Denmark's Energy Agency on forests, biomass, and carbon. He knows both worlds — the forest and the spreadsheet.

I met with him recently. His diagnosis was sharp: the biggest barrier to forest investment isn't the returns. It's trust. And knowledge. On both sides.

Forestry people don't know how to present their asset in financial terms. And financial people have never learned what a forest actually is — or what it can deliver beyond timber.

The Remixed Nature model: Their projected annual returns sit at 6.6–7.4%, depending on the product. All forests carry PEFC or FSC certification. They position carbon credits and biodiversity value as potential upside — not yet calculated into returns. That's conservative. And it's smart. Investors trust people who under-promise.

The client profile: Minimum investment is about €540,000. Their clients are wealthy individuals, often Danish families looking at forests for estate planning and long-term wealth. Not hedge funds chasing quick returns.

The philosophy: Nature should not be a support area. It should be an asset class on par with all others.

"Smart Money Isn't Buying Trees. It's Buying Forests."

That line came from Shauna Matkovich, founding director of The ForestLink and host of the Forest Invest Podcast. She dropped it in the comments under our EFP #60 post on LinkedIn.

Her point cuts deeper than it sounds. If the sector keeps framing forest investment as "buying timber," it misses the full picture. The real value is timber plus carbon, plus biodiversity, plus land appreciation, plus ecosystem services. All in one asset.

The LinkedIn debate: When another commenter asked whether investors are really buying forests or just land, Shauna pushed back. Investors each have their own reasons. Land is part of it, especially in the Nordics. But that viewpoint is too narrow for the sector. Her question: if they just wanted land, why would they invest in forest land?

The management factor: Michael Brinch-Pedersen, a financial and tech impact expert, added another layer: the real driver of returns isn't the asset itself. It's how you manage it.

That's the point. Forests are not passive. They need active, professional management to unlock their full value. And that management story is what the finance world has never heard properly.

What Needs to Change

Three things need to happen for European forest investment to reach its potential.

Forest owners need to learn financial language. Stop selling cubic meters. Start selling risk-adjusted returns, biological growth rates, and portfolio diversification. If Tornator can post €168 million in profit, someone needs to explain why — in terms a pension fund manager understands.

Financial institutions need forest literacy. The basics. What is a rotation? What does "site index" mean in return terms? How does biological growth compound? Universities teach forestry and finance in separate buildings. That needs to change.

The sector needs more bridge-builders. People like Anders, who hold a PhD in forestry but speak fluent finance. People like Shauna, who spent 15 years managing tropical forest funds for institutional investors and now helps connect capital with forest opportunities. Europe needs dozens more like them.

The Numbers Are on Forestry's Side

Here's what makes this frustrating. The investment case writes itself:

Tornator: record profit of €168 million on 819,000 hectares across Finland, Estonia, and Romania. Revenue up 9% to €232 million.

Rayonier: EBITDA up 7.7%. Forest owner, not processor.

German spruce sawlogs: €129–132 per cubic meter. All-time record. Forest owners earning €25–30 more per cubic meter than last year.

Meanwhile, every major processor is bleeding. Södra lost 1.29 billion SEK. West Fraser lost $937 million. The value chain is inverting. Forest owners have the leverage. Processors are squeezed.

If any other asset class showed these numbers, capital would be flooding in. Forests don't get that response — yet — because the communication bridge doesn't exist at scale.

Building it is the single biggest business opportunity in European forestry today.

What this means for you: If you own forests, learn to present your asset in financial language. If you manage money, start learning what forests actually deliver. The gap between the two is where billions in unrealized value sit. Sources: Remixed Nature company information (remixednature.com); Shauna Matkovich comments on ForestryBrief LinkedIn post, February 2026; Forest Invest Podcast; Tornator, Rayonier financial results (EFP #60)

📊 Quick Hits

1. 🇩🇪 German Sawlog Prices Smash All-Time Records

German spruce sawlogs in grade B 2b+ now fetch €129–132 per cubic meter. Pine sits at €95–98. Both are the highest prices ever recorded.

The numbers: Forest owners earn roughly €25–30 more per cubic meter than in 2025. Sawmill yards are empty. Industry groups describe a "raw material shortage."

The ripple effect: Lower-quality industrial wood and energy wood prices are also rising as the tight market lifts all grades.

Why it matters: These are realised contract prices, not forecasts. The German conifer log market is the tightest it has ever been. Forest owners benefit. Sawmills and panel producers face rising procurement costs.

The takeaway: If you own German conifers, this is the best selling position in recorded history. If you process wood, your margin squeeze just got worse. Source: Forest Machine Magazine / agrarheute, February 2026

2. 🔥 German Pellet Prices Hit Highest Level Since June 2023

German wood pellet prices surged through winter. In the first week of February, buyers paid just under €400 per tonne for a six-tonne loose delivery. That's the highest since mid-2023.

The spike: Bagged pellets averaged €406 per tonne — about €30 more than four weeks earlier. A long cold spell, shrinking stocks, and tight supply drove the increase.

The biomass market signal: When pellet prices rise this fast, it shows strong demand for forest biomass even outside traditional sawlog markets. Low-grade wood that can't find a sawmill buyer has an alternative outlet — at rising prices.

The takeaway: If sawmills won't take your wood, the pellet market might. Strong winter demand keeps even low-grade forest biomass profitable. Source: Global Wood / agrarheute

3. 📋 EUDR Information System Hits Access Problems

The European Commission notified subscribers of temporary access limitations to the EUDR Information System starting mid-February. Duration was not specified.

The deadlines remain: December 30, 2026 for large and medium operators. June 30, 2027 for SMEs.

The practical problem: Companies preparing for compliance need the system to test their processes. Temporary outages add uncertainty to an already tight timeline.

The takeaway: Don't wait for the system to work perfectly. Build your data collection and due diligence processes now. When the system stabilizes, you want to be ready to upload — not scrambling to collect data. Source: EC ENV-DEFORESTATION newsletter, February 12, 2026 | EUDR deadlines confirmed via official regulation

4. 🌍 EUDR Compliance Costs: The Hidden Burden on Producers

New research published via ATIBT and Elsevier examines the real cost of EUDR compliance for producer countries, especially in tropical timber.

The finding: The data collection burden falls hardest on those least equipped to handle it. Exporting countries must provide geolocation data, legality documentation, and supply chain transparency — often without the digital infrastructure to do so efficiently.

The trade impact: If producing countries struggle to comply, supply disruptions follow. European importers face longer lead times and higher costs from their suppliers.

The broader point: EUDR was designed to clean up European supply chains. But the cost of compliance doesn't fall evenly. Producer countries bear a disproportionate share.

The takeaway: If your timber comes from tropical sources, expect longer lead times and higher compliance costs from your suppliers. Factor this into your 2026 procurement planning. Source: ATIBT / Elsevier research

📅 The Weeks Ahead

February 24–27, 2026: DACH+HOLZ International — Cologne, Germany (wood construction trade fair)

March 5, 2026: Women in Forestry Virtual Summit — Canadian Forest Industries

March 11–12, 2026: FEA Global Softwood Log & Lumber Conference — Vancouver

March 17–19, 2026: Wood Tech Expo — Warsaw, Poland

April 30, 2026: EUDR simplification review deadline

December 30, 2026: EUDR deadline for large and medium operators

💡 One Thing to Try This Week

Describe your forest in financial language.

Take one of your forest stands. Just one. Now try to answer these five questions as if you were talking to an investor, not a forester:

  1. What is the annual biological growth rate as a percentage of current value?

  2. What revenue streams does it generate (timber, hunting, carbon, recreation)?

  3. What is the projected return over 10 years, including land value appreciation?

  4. How does it compare to a government bond or real estate investment?

  5. What are the main risks, and how are they managed?

If you can't answer these — that's the gap. That's exactly why capital isn't finding its way to your forest.

You don't need to become a banker. But you do need to speak enough of their language to start the conversation.

The EU study we covered in EFP #59 showed that 80% of forest income comes from wood. That's the starting point. But investors want to see the full picture. Growth rate. Diversified revenue. Risk management.

Forest owners who can present that picture will attract capital. Those who can't will keep wondering why nobody invests in their asset class.

Fifteen minutes with a calculator. That's all it takes to start.

Until Thursday!

Wish you all the best: Peter

P.S. What’s the biggest challenge you’re facing in forestry right now?
Hit reply and let me know — I read every message personally.

P. P. S. Know a forest professional who’s drowning in EUDR complexity or missing out on timber market shifts? Forward this email to them!

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P. P. P. S. Shauna Matkovich's Forest Invest Podcast is one of the best resources for understanding where forest finance is heading. If this week's Big Story made you think, start there.

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