Forest-based Industries

The four main forest-based industries

From forests to industrial products

Europe's forest resource

The EU has approximately 177 million hectares of forest and other wooded land. Forests therefore represent one of Europe's most important domestic renewable material resources.

Forest resources differ substantially across the Union, ranging from boreal forests in northern Europe to temperate, alpine and Mediterranean ecosystems.

Their economic role goes beyond timber production. Forests support biodiversity, carbon storage, water regulation, recreation, rural economies and the supply of both wood and non-wood products.

EU Forest Strategy for 2030

The EU Forest Strategy for 2030 seeks to improve the quantity, quality and resilience of European forests while recognising the economic and social contribution of forestry and forest-based industries.

The strategy aims to reconcile forest protection and biodiversity objectives with the continued contribution of forest-based value chains to Europe's rural economy and bioeconomy.

The new EU Bioeconomy Strategy

In November 2025 the European Commission presented a new Bioeconomy Strategy focused more strongly on industrial deployment, market scale-up, competitiveness and resilience.

Forest-based industries are directly relevant to this shift. Wood, fibres and other biological materials can substitute fossil-intensive inputs in construction, packaging, chemicals, textiles and other manufacturing activities.

The wider EU bioeconomy employed more than 17 million people and generated around €2.7 trillion in economic activity in 2023, illustrating the scale of the broader market within which forest-based industries operate.

EU Deforestation Regulation: a major compliance shift

Regulation (EU) 2023/1115 introduces due-diligence requirements for commodities and products associated with deforestation and forest degradation, including wood and many derived products.

Following amendments adopted in 2024 and 2025, the main obligations will apply from 30 December 2026 to large and medium operators and from 30 June 2027 to micro and small operators, subject to the specific transitional provisions.

Operators must be able to demonstrate that relevant products comply with the regulation's deforestation-free and legality requirements and submit the required information through the EU information system.

Woodworking and construction

EU woodworking industries produce sawn wood, wood-based panels, engineered products and construction materials.

Wood is becoming increasingly relevant to European construction policy because timber-based products can store carbon and substitute more emissions-intensive materials in some applications.

At the same time, increased construction demand for wood must be reconciled with sustainable harvesting levels, forest resilience and competing uses for biomass.

Furniture: a major European manufacturing sector

Furniture is one of the largest employment areas within the forest-based economy. Eurostat data show around 1.1 million employed workers in furniture manufacturing in 2022, alongside a significant self-employed workforce.

The European industry combines design, specialised manufacturing, cultural heritage and advanced production technologies, but remains exposed to energy and material costs, international competition and changing consumer demand.

Pulp, paper and fibre-based products

The European pulp and paper industry has traditionally been energy- and raw-material-intensive, with substantial capital requirements and long investment cycles.

Eurostat recorded approximately 637,300 people working in paper and paper-product manufacturing in 2022, around 10.9% more than in 2012.

Growth in fibre-based packaging, recycling and alternatives to some plastic applications is creating new opportunities, while energy costs and sustainable access to wood fibre remain important competitiveness factors.

Printing in a changing market

Digital communication has structurally reduced demand for some traditional printed products, particularly advertising and publishing applications.

Growth opportunities increasingly lie in packaging, digital printing, intelligent labels, specialised printing and integrated communication services.

The sector remains characterised by a large number of SMEs and micro-enterprises and is closely connected to Europe's paper and packaging value chains.

Cascading use of woody biomass

EU policy encourages the cascading use of woody biomass: where possible, wood should first be used in applications that retain the highest economic and material value before later reuse, recycling or energy recovery.

This approach seeks to maximise the value obtained from limited biomass resources while reducing waste and improving material efficiency.

Circularity and secondary fibre

Circularity already plays an important role across forest-based industries, particularly through recovered paper, reuse of wood products and recycling of fibre-based packaging.

Future EU circular-economy measures are likely to further strengthen the economic value of secondary fibres, recycled paper and recovered timber.

Carbon storage and substitution

Forest-based products occupy a distinctive position in EU climate policy. Trees absorb carbon during growth, while long-lived wood products can retain part of that carbon during their useful life.

Substituting some fossil-based or emissions-intensive materials with renewable wood-based products can also contribute to decarbonisation, provided that forest resources are sustainably managed.

The main pressures on European forest-based industries

EU institutional sources