European Forestry Pulse #92 🌲

Hello,

The US lumber market has a story everyone repeats. Tariffs would cut imports and push prices up. This week's trade data tells a more interesting tale.

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

For two years, one story dominated timber trade. US tariffs would choke imports and lift US prices. Half of that came true. The other half did not. And the gap matters for every European mill that sells west.

European lumber exports fell hard in the first quarter. Finland's exports dropped 9%, to 2.092 million cubic metres. Sweden's fell 12%, to 3.18 million cubic metres. Germany reported a "slump" in softwood lumber exports.

The United States pulled back even harder. US softwood lumber imports fell by nearly 2 million cubic metres in Q1. That was the steepest drop of any major import market. Germany and China followed. Supplier volumes fell most for Canada, Russia and Austria.

The ripple reached Asia too. Indonesia's plywood exports fell 26% in the quarter. US shipments had collapsed.

Here is the part the headlines miss. US lumber exports actually rose. They climbed 25.9% in March, to US$83.5 million. Volume rose 25%, to 278,128 cubic metres. Mexico was the top buyer, at US$24.5 million and a 29.4% share.

So the US is buying less from abroad and selling more of its own. Yet US prices are not surging. The Madison's Lumber Prices Index sat at US$521 in the last week of May. That was flat week-on-week. It is up 9% on a year ago and 25% on two years ago.

Flat prices plus collapsing imports tell a clear story. US demand is not booming. It is being rationed by price.

US duties on Canadian softwood now run near 45%. A wall that high does not pull in more European wood. It shrinks the whole import pie. With US mortgage rates at 6.53%, American building stays slow. The US is leaning on its own mills and on Mexico, not on imports.

For Europe, the western door is not slamming shut. It is narrowing. Mills that leaned on US or Middle East demand now need new markets.

If you export lumber: stop treating the US as a growth market this year. Map your next destinations now. The mills that open new doors first will come out ahead.

If you trade or import: watch for Canadian wood that can no longer enter the US. Some of it will look for a European home and test prices here.

If you sit on a board: stress-test any plan that assumes US revenue grows in 2026. Build the budget around flat-to-lower export volumes. Sources: Timber-Online Q1 export analyses (Finland, Sweden, Germany — subscription only) | Lesprom — U.S. softwood lumber imports fall by nearly 2 million m³ | Lesprom — Indonesia's plywood exports decline 26% | Fordaq — USA softwood lumber exports rise 25.9% in March | Fordaq — Lumber and Panel Market Weekly, Week 22 (subscription) | Lesprom — U.S. 30-year mortgage rate rises to 6.53%

Germany's timber trade had a good March. The GD Holz member survey showed sales up 10% on a year ago. That is the first single-month gain this cycle. First-quarter sales are up 2.7%. The association still calls the wider outlook "subdued."

Why it matters: GD Holz surveys traders in Europe's largest timber market. Its monthly read is the most-watched gauge of real trade activity.

The context: Pair this with the firm-but-flat US benchmark above. Demand is not collapsing everywhere. Some corners are turning.

The takeaway: One month is not a trend. Watch the April number before you call a recovery. Source: Global Wood Markets Info — German timber trade sales rose 10% in March (subscription)

Two signals of confidence landed in the past week. On 26 May, Metsä Group inaugurated its expanded tissue mill at Mariestad, Sweden. The €370 million project has doubled annual capacity to 145,000 tonnes. It added a new machine and three converting lines. It also uses less water and less energy per tonne.

The second signal is about influence. Katariina Kemppainen, Metsä Group's R&D head, became Chair of the Bio-based Industries Consortium. She took the role on 28 May. The BIC partners the EU on a €2 billion bioeconomy funding programme. Her stated focus is securing EU research money for the sector.

Why it matters: Real money has gone into European tissue capacity in a weak paper market. And a forest-industry leader now helps steer EU bioeconomy funding.

The takeaway: When buyers fret about paper, watch where the capex actually goes. It is going into tissue and specialty grades.

Sources: Lesprom — Metsä Group doubles Mariestad tissue capacity to 145,000 tonnes | Metsä Group — Katariina Kemppainen to chair a major European bioeconomy organisation

Europe's sawmill map keeps shrinking and concentrating. The continent's top 20 softwood producers raised output by about 20% in 2025. They did this even as smaller mills closed or were bought.

Why it matters: The recent closures are not cutting European capacity. They are moving it to fewer, larger players. The survivors are getting bigger.

The context: It follows the southern-Sweden mill closures and the felling drop we tracked in EFP #89. Capacity is consolidating, not disappearing.

The takeaway: If you sell logs, plan for fewer and larger buyers. Their scale will shape your price. Source: Timber-Online — “Fewer sawmills, higher lumber output” (Europe’s top 20 producers +20% vs 2024; subscription only)

Map your export-destination concentration — before a tariff or freight shock maps it for you.

The Big Story shows how fast a single market can cool. Twenty minutes today shows where you are exposed.

By Friday you'll know which door to open next.

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Until Thursday!

Wish you all the best: Peter

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