In almost any market for primary materials and resources — fossil energy, mining, fisheries or agriculture, for example — a rise in demand triggers a fairly rapid rise in supply. Timber production is different, and there are several reasons for this. First, forest resources grow and develop over a far longer timescale than economic markets: forestry has to plan a production cycle spanning several decades. Second, most producers are forest owners who are not professionals but, for the most part, private individuals with other sources of income. European timber production is not concentrated in a fixed number of estate managers but is dispersed among millions of forest owners with differing interests, operating in varied ecological and socio-economic conditions that affect tree growth and timber harvesting.
Rising demand in the timber sector can place considerable pressure on forest land and lead to inadequate levels of timber extraction (harvesting), which may damage or even destroy the ecosystem. Looking back through history, large-scale deforestation took place in Europe in the 18th century. The growing need for agricultural land to feed a rising population, together with growing demand for timber used in manufacturing, international trade and warfare (for example, wood fuel for the steam engines of the day, construction timber for shipbuilding, and mining), led to a reduction in forest area in most countries (to less than 10%) — although this did not apply to Northern Europe and the Baltics. Restoring the forests took great effort, and out of it forestry emerged as a more or less systematic, institutionalised form of land management (as we know it today), intended to reduce the risk of deforestation and overexploitation.
In addition to producing timber or woody biomass, forests deliver many other ecosystem services, some of which are highly significant for forest owners, local residents and society at large.
Ideally, forest productivity at a given site should be kept constant for the prevailing climate, since under a sustainable management regime the forest ecosystem must recover after timber harvesting. However, practices that cause soil erosion can have a considerable negative effect on land productivity. Since a large share of unused timber resources is located in areas that are difficult to access, it is important that soil science recommendations are also taken into account when bringing additional resources into use. If trees are to grow as we would wish, it is not only the quantity of soil that must be preserved but also its quality. This applies especially to soils where the fine structures of woody biomass (that is, leaves, needles and bark) contain high concentrations of nutrients.
As we know, constraints are any circumstances that hinder the development and implementation of effective solutions for what is termed timber mobilisation and for active forest management. They are determined chiefly by a particular combination of forest resources, markets and governance: the conditions of the region in question, often linked to structural shortcomings or to a lack of usable knowledge among those involved.
The problems identified
Forest resources do not match market demand. Today's forest is the result of many years of work (management) by previous generations of forest owners and foresters. The composition of tree species, the age distribution of the trees and timber quality are among the basic characteristics of a managed forest area. They are the result of specific site and growing conditions associated with the forest ecosystem (soil, climate and forest genetics, for example) and with management. These factors determine how much timber can be produced. The main obstacles to timber mobilisation include forest resources that do not match the demand of the available timber markets, and stands that are not yet mature for harvesting or that are of inadequate timber quality.
Inefficient harvesting techniques and practices. There are various ways of managing forests and extracting timber, each of which has a direct bearing on the cost of timber mobilisation and on timber prices. An unsuitable choice of infrastructure design or of harvesting method can raise extraction costs and prevent harvesting even where marketable timber stocks are available. Modern knowledge and equipment for mechanised timber harvesting, which can substantially improve logging operations and worker safety, are not yet widespread, particularly among small owners, and this can be a major obstacle to timber mobilisation.
Sustainability concerns and the impact of climate change. Concerns among forest owners and forestry professionals about the risk of forest ecosystem degradation as a result of increased logging can also be an obstacle to timber mobilisation. These constraints are not legally binding, but they are imposed de facto on forest land by, for example, owners who care about soil quality and nature conservation. It should be remembered that climate change is increasing the vulnerability of forests to disease, pests, forest fires and storms. More frequent environmental impacts reduce forest stability and the volume of timber available for logging.
The constraints on the use of forest resources described above are often regarded as the main “problems”. Most of them are bound up with obstacles in other problem areas that are in fact easier to address. Foresters may, for instance, identify “steep slopes” or “boggy ground” as the main barrier to timber mobilisation, yet this problem cannot be solved directly. It may be more useful to look at the “lack of access to capital” or the “insufficient capacity of advisory services”, which could be resolved through cooperation, for example. There are countries where cooperation has developed very successfully; in Latvia the results are not yet so impressive and we still have much to do in this area, though one or two strong cooperatives have already been established and are working very successfully, improving both the quality of services to forest owners and their own contribution to genuinely sustainable forest management.
Laws, regulations and rules that restrict productive forestry. This concerns laws and rules that impose restrictions and/or give rise to high costs or uncertainty for productive forestry. Examples include restrictions on the chemical control of pests on forest land in order to prevent soil and water pollution, the obligation to carry out an environmental impact assessment (EIA), and restrictions on economic activity in certain areas for nature conservation and habitat protection. An important general obstacle, particularly for small forest owners and forestry businesses, is the heavy bureaucratic burden, or what is known as forest bureaucracy, created by a complex regulatory system for forestry and by the constant growth of environmental protection requirements — requirements that are often subjective and offer no compensation for the burdens they impose.
A lack of effective cooperation that is not determined by legislation. The problem lies with legislation that does nothing to promote cooperation in forest management and markets, or that promotes only isolated activities. Cooperation between private owners (in associations, cooperatives or other organisations, for example) is often insufficiently productive, and there are situations in which an active participant in the timber market needs a clearer, more specific legal basis. Legislation needs to develop, because the formation of cooperative groupings in the forest sector must be encouraged to become still more active and stronger.
Other regulatory and legal obstacles. Laws and rules that impose restrictions and give rise to high costs or unclear situations for transport, markets and trade (imports/exports). Timber haulage, for example, is one of the most significant cost factors, so national legislation setting weight limits for timber has a substantial, even decisive, effect. Tariffs on forest products are the main factor shaping international import and export markets for the EU forest sector. Import duties or quotas on EU forest products are in effect protectionist subsidies for competing goods, while duties or bans on timber exports to the EU can act as a constraint on raw material supply, narrowing market potential still further. As regards competitiveness, legal requirements on worker health and safety differ from country to country and can be an important factor affecting costs. Finally, forest health rules are needed, particularly phytosanitary measures to prevent the spread of pests, but these in turn can significantly restrict timber mobilisation on a wider scale.
Financial and material obstacles. These are obstacles relating to infrastructure and material resources, chiefly at regional level, as a result of which forest sector businesses face high transaction and operating costs in making more active use of forest resources.
Problems arising from land ownership. The fragmentation of small holdings. Fragmentation is one of the most common obstacles, particularly in private forests owned by individuals or families (in the European context these are often referred to as non-industrial private forest owners – NIPF). There are around 16 million private forest holdings in Europe, a large proportion of which are smaller than 3 ha. (In Latvia the average area is 8.8 ha.) Most forest owners in the European Union own only around 1 ha of land, or even less. Sustainable forest management is threatened by the fragmentation of forest land into small holdings, by unfavourable spatial shapes of holdings, unclear boundaries, division into enclaves, and unclear or complicated forms of ownership (communities of heirs, and so on).
Resolving fragmentation is one of the central tasks of timber mobilisation. Historically, the emergence of fragmentation may be linked to the reorganisation of the governance systems for common land at the close of agricultural intensification in the late 19th century. In many regions, community-owned forests were divided among citizens who acquired private land rights. This was often carried out according to a rigid scheme, quite literally dividing the land on the map with a ruler. As generations passed, these small plots were divided still further. The traditional system of partible inheritance, which requires an estate to be divided into equal shares among the heirs, is the unfortunate reason why fragmentation continues to increase.
This obstacle is especially significant in the regions of Western Europe that have partible inheritance traditions, and in some Central and Eastern European countries where the number of private owners continues to grow as a result of restitution and privatisation processes. In small countries such as Latvia there are around 110,000 forest owners, and in Lithuania 250,000.
A lack of cooperation
Forestry operations can be carried out more efficiently by managing forests over larger areas at the same time, thereby reducing the costs of logging and timber haulage. Forest owners, however, often have differing forest management objectives, so forming effective cooperatives is not always an easy task. In fragmented forestry, timber mobilisation can only be achieved with the help of some form of cooperation between landowners.
Fluctuations and disruption in the main timber markets
Timber markets have become more global, which makes them more sensitive to price competition. Market conditions for the traditional forest sectors are changing and new market participants are appearing that compete for the same raw material (bioenergy, biomass and biofuel, for example). International trends in demand or in trade competition can significantly affect regional markets, and unforeseen events or natural disasters such as storms, forest fires or prolonged drought can cause considerable market volatility, as a sudden surplus or shortage of marketable timber disrupts the normal course of price development. Such events can affect several European regions at once, depending on their scale, since regional timber markets are of course interdependent.
Although Latvia's forest sector is strong, and we can justifiably regard Latvia as a “forest superpower”, several of the problems listed above are all the more pressing for our country in the process of timber mobilisation. In the Latvian context it is particularly important to stress the conditions for making effective use of forest resources without them being disproportionately encumbered by ever-growing nature conservation requirements, which are often based on the subjective and tendentious activities of so-called nature experts or forest policy experts. The result of these activities is the constant misinforming and frightening of the public with all manner of supposedly science-based “horror scenarios” about the decline of biodiversity in our country. The species protection plans that have been drawn up, and other measures by environmental non-governmental organisations, bear this out — for example, the “Hazel Grouse Protection Plan”, written and approved some time ago now, which rests on a variety of assertions and assumptions. Written works of this kind, and the consequences of implementing them, are capable of paralysing the forest sector…
It is alarming to imagine what such “experts” will write in the next report to the European Commission on the state of biodiversity in Latvia. It should be borne in mind that the famous “nature census” (in fact a survey of the distribution and quality of specially protected habitats of EU importance, which cost 9.5 million euros) came to an end some time ago. One has to ask: what will strike these “experts” as “dramatic” and “catastrophic” next time round, as they prepare yet another report for Brussels? One can only hope that this report will be submitted for evaluation, before it is sent, to forest and land owners, to representatives of the forest sector and related industries, and to local authorities…