The Looming Timber Crisis: Why Europe’s Print Industry Faces an Uncertain Future
For two decades, European publishers have navigated declining circulation, dwindling advertising revenue, and mill closures. But a new, potentially more disruptive challenge is emerging: the availability of fibre – the raw material for paper. The future of print isn’t solely about adapting to a digital world, but about securing access to a diminishing resource.
Forest Owners Rethink Timber Sales
Traditionally, selling timber has been the primary revenue stream for forest owners. However, this is rapidly changing. Forest owners across Europe are increasingly questioning why they *should* sell timber when more lucrative alternatives are multiplying. These include carbon credit schemes, solar leases, and incentives for land set-asides under the EU Nature Restoration Law.
In Finland, a stark example of this shift occurred in the third quarter of 2025, when timber trade collapsed by 42 percent – not due to a lack of trees, but because landowners chose not to sell at current prices. A Swedish forest owner today has multiple revenue options beyond simply selling to a wood buyer, including carbon credits and biodiversity payments.
A Structural Shift: From ‘Dead Trees’ to ‘Living Trees’
The forestry industry is witnessing a structural shift, moving away from timber harvesting towards valuing “living trees” – prioritizing carbon sequestration, biodiversity, and alternative land uses. Currently, timber sales still account for 80 percent of revenue in the forestry industry, but this figure is expected to decline. This isn’t a temporary fluctuation; it’s a fundamental change in how forests are viewed and utilized.
Policy Collisions and Competing Land Uses
The collision of various EU policies is exacerbating the situation. The EU Biodiversity Strategy, the Nature Restoration Law, the Renewable Energy Directive, and LULUCF regulations all pull in different directions. Maximizing carbon storage, renewable energy production, material substitution, and biodiversity are often conflicting goals.
This policy complexity is already impacting the market. European softwood fibre prices are significantly higher than in North America, and energy costs have accelerated mill closures.
Mill Closures and Supply Chain Vulnerabilities
The European graphic paper sector is particularly vulnerable, with operating rates hovering around 65 percent – a state of “survival mode.” Any further constraints on fibre supply could push more mills into closure. The pace of mill closures is accelerating, with facilities like UPM Kaukas and Ettringen, Sappi Alfeld, and International Paper facilities shuttering in recent months.
The loss of Russian timber imports following the EU ban has further strained the supply chain. Finland, in particular, had to dramatically increase domestic harvesting to compensate, potentially at an unsustainable rate.
Beyond Price Volatility: A Supply Structure Problem
Previous paper shortages were often logistical – a port closure or transportation strike. The current situation is fundamentally different. It’s not just about getting wood to the mills; it’s about whether enough wood will be *available* at any price. This is a supply structure problem, not a supply chain problem.
What This Means for Publishers
Many publishers are misinterpreting current price volatility as a short-term disruption, expecting a return to “normal” once construction recovers or energy prices stabilize. However, European graphic paper demand fell another 10 percent in the third quarter of 2025, indicating a continued structural decline accelerated by digitalization. Mills are closing not because of temporary conditions, but because demand isn’t rebounding.
Publishers who understand this are diversifying suppliers, locking in longer-term contracts, and building relationships beyond traditional channels. Those waiting for “normal” may find it doesn’t return.
The Uncomfortable Truth: The Carbon Math
The industry often presents a simplified “carbon neutral” narrative – trees grow, paper is made, paper is recycled, and new trees grow. However, EU scientists are raising concerns that European forest carbon sinks are weakening due to increased harvesting, climate stress, and pest outbreaks. The carbon debt from biomass, used for energy, can take 50-100 years to repay.
A credibility gap exists between the industry’s sustainability claims and the scientific reality. This gap poses a growing business risk.
Strategic Mistakes to Avoid
The biggest strategic mistake publishers can make in the next five years is assuming their current supplier will still be there. Mill closures are accelerating, eliminating options and concentrating supply. Publishers necessitate to build supply chain resilience *before* they need it.
FAQ
What is the EU Nature Restoration Law?
The EU Nature Restoration Law aims to restore degraded ecosystems, including forests, across Europe.
What are carbon credit schemes?
Carbon credit schemes allow landowners to earn revenue by preserving forests and the carbon they store, rather than harvesting timber.
Why are forest owners choosing alternatives to timber sales?
Alternatives like carbon credits, solar leases, and land set-asides offer comparable or higher revenue with less operational hassle.
Is the paper industry doing enough to address these challenges?
Currently, no. The industry has primarily focused on managing declining demand and has limited institutional capacity to address supply-side constraints.
Pro Tip
Diversify your paper sourcing. Don’t rely on a single supplier. Explore alternative specifications and build relationships with multiple vendors.
The time to act is now. The future of print depends on recognizing and responding to this fundamental shift in the forest-paper relationship.
