New study on economic impacts of potential EU forest carbon sink policies on the forest-based sectors

Preliminary results of a study titled “Economic Impacts of potential EU forest carbon sink policies on the forest based sector” were presented on September 6th at a workshop in Brussels.  The results show that if countries in the European Economic Area (EEA) would limit their future harvests to comply with the EU forest carbon sink policies, the EEA ‘s roundwood harvest could decrease considerably.

According to the study, “if the EEA countries limited their future roundwood harvests to comply with the assumed levels, harvests would be almost 120 million m3 or 20 % lower in 2030,” compared to the scenario without the assumed limitations. To compensate, a share of the roundwood sourcing would be relocated outside the EU, especially in Southern and Northern America. That would also lead to reducing forest carbon sinks in those areas.

Although the European forest industry would compensate part of this by increasing wood imports from outside the EEA, the proposed policies would reduce the production of sawn timber and plywood. This would affect employment, especially in the mechanical forest industry and forestry. Thus, the harvest limitations will jeopardize the desired shift towards production of “carbon-storing” wood products, Dr. Maarit Kallio from Luke summarized.

In other words, a large part of the forest industry production growth potential in the EEA will relocate outside Europe, if harvests are constrained. According to the study, this would also lead wood being less competitive towards steel and concrete, as the global prices of forest products would increase. Consequently, according to Dr. Kallio, the environmental integrity is at risk.

The preliminary results of the study were published just prior to the vote by the European Parliament on LULUCF (Land Use, Land Use Change and Forestry) on 13 September.

This article is based on the summary and presentation material of the analysis study which can be downloaded at 　www.tapio.fi/EUcarbon