Estonia’s modern forest products industry was established in early 1990 when state regulation of economic development gave way to private ownership of property. The wood market started to be based on the market economy, and the success of a company no longer depended on state funds but rather on the efficiency of using raw materials.
Estonia uses about 4.5 million m3 of wood for sawn wood production and around 3 million m3 is used for log houses, veneer and plywood, wood chips and biomass. The domestic pulp industry uses only a small amount of the pulpwood produced by forest cuttings and the spruce, pine, birch and aspen pulpwood not used in Estonia is exported to the Scandinavian pulp and paper industries.
During the past 10 years the greatest improvements have occurred in the sawmilling industry. Since the early 1990s, production of sawn material has grown more than 600%, from 250,000m3 to 1.8 million m3 today. Estonia’s modern sawmills – the largest are Stora Enso‘s Imavere and Paikuse mills, and Toftan Ltd – are capable of using all available raw material.
The Imavere sawmill’s annual production is 380,000m3 – one-and-a-half times that of the whole sawn material production of Estonia 15 years ago. Some mature forests remain unharvested, largely because of conservation measures, which leads to log supply falling short of demand. To alleviate the shortage, more than 1.3 million m3 of softwood was imported – mainly from Russia and Latvia – in 2004.
Veneer and plywood production has undergone rapid growth and total output is now more than 45,000m3.
Added-value processing is also a growing trend in Estonia’s timber industry. This rise in further processing of sawn material through planing, glued wood products and finger-jointing has created a shortage of raw material which is filled by imported sawn material – more than 500,000m3 last year.
In 2004, Estonia’s timber exports were down 9% on the previous year, while imports rose by 52%. Last year exports accounted for 64% of the timber industry’s total turnover, an increase of 13% on 2003. The main export products are sawn material, unprocessed roundwood and construction timber. In 2004, 40% of production was exported to Estonia’s three largest target markets – Finland (14%), Great Britain (13%) and Germany (13%).
The timber industry is vital to the country’s economy and employment, providing around 10% of the total number of jobs. From 1994-2003 Estonia’s job number fell by 109,000, but 16,000 jobs were created in the timber sector.
Estonia’s domestic consumption of sawn material is 1.3 million m3, amounting to 0.9m3 per capita. Woodinfo, a non-profit organisation, was established in 2001 to promote the use of wood. It has financed local wood processing businesses and hosts an annual architectural competition. The first competition surprised the press by choosing a cow barn as the winner, while last year’s first prize went to terraced housing that illustrated good use of wood in the urban environment. The competition also addresses more specific uses of wood in the construction process by choosing the best uses of glulam, plywood and wood cladding. The most recent competition ended with a ceremony which included a fashion show of clothes made from birch veneer, emphasising the diverse opportunities for using wood.
