Positive balance for Austrian forestry thanks to good demand and despite rising costs

In their traditional annual business press conference, the Land&Forst companies in Austria take stock

The year 2022 was a positive year for the domestic forestry industry with numbers in the black. The positive trend of 2021 continued and the good demand for the raw material wood allowed most domestic forest managers to take positive stock. This balance is clouded by continuing calamities, especially in the south of the country, and the general increased cost pressure

LFBÖ President Felix Montecuccoli

Vienna (OTS) – In their traditional annual business press conference, the Land&Forst companies in Austria take stock and state: climate change, increasing drought and massively rising costs are a constant challenge, but at least the currently good market conditions make it possible for the domestic companies to survive economically. However, the many contradictory and one-sided political “projects” in Brussels, NGO-driven and short-sighted political debates and their possible implementation in Austria cause headaches.

„The year 2022 was a positive year for the domestic forestry industry with numbers in the black. The positive trend of 2021 continued and the good demand for the raw material wood allowed most domestic forest managers to take positive stock. This balance is clouded by continuing calamities, especially in the south of the country, and the general increased cost pressure“, explains DI Felix Montecuccoli, President of Land&Forst Betriebsbetriebe Austria in his opening statement.

Price development 2022

In 2022, a price increase was recorded for all types of wood and assortments. The needle saw logs remained the engine of Austrian forestry. Spruce logs had an average price of 113 euros with tips up to 125 euros. Significant price increases to 41 euros per cubic meter were also recorded for coniferous industrial wood after years of downward trend. Hardwood prices also rose due to the strong demand for firewood. Despite all the euphoria, Felix Montecuccoli points out: “With all the positive price developments, a look at the consumer price index shows that the currently high inflation is nullifying part of this positive development. If you look at the price of spruce saw logs, for example, the current price of 112 euros per cubic meter – adjusted with the CPI from 1976 – is below the values ​​for the years 2011 to 2016. In addition, the very labour-intensive forestry industry is particularly affected by the increase in personnel costs. ”

The costs are rising – the capacities are falling

Like many other sectors, forestry has recently been struggling with increasing cost pressure. The high energy costs, the rising wage costs for skilled workers and the expensive investment costs for timber harvesting machines were particularly important here. At the same time – not least due to the high demand and the local calamities – the capacities of the service providers for timber harvesting and timber transport decreased: longer waiting times were the result.

Climate change as a major challenge

Despite the currently encouraging economic situation, climate change remains the greatest challenge for domestic forestry. Too little precipitation, more hot days and extreme weather events have put forestry under massive pressure in recent years. The consequences were large-scale bark beetle calamities and an increased incidence of damaged wood. The forecasts for next summer are not the best given last winter’s drought and excessively warm temperatures. “Nevertheless, we hope that the general weather situation will repeat itself as in 2021, when precipitation stabilized again in early summer. If this does not happen, we expect a significant increase in bark beetle calamities and forest fires again this year,” says Montecuccoli about the current situation.

Shorter periods of use reduce risk and help the climate

If the usage periods are shortened, the function of the forest as a carbon sink can be optimized through the higher growth in younger growth phases. At the same time, this reduces the risk of losing forest stands to calamities. In the Austrian forests, a large stock of wood has been built up over the last few decades. In the light of increasingly frequent windthrows, bark beetle calamities and also forest fires due to climate change, it is advisable not to put these stocks under the cheese cover in the interests of carbon storage. Rather, sustainable wood products are an important way to phase out fossil raw materials.

Calamities and climate change make increased investments in forestry necessary

The calamities of recent years and the increasingly visible consequences of climate change make increased investment in silviculture necessary. The primary goal is the development of ecologically and economically valuable and stable forest stands. On the one hand, this should cushion the consequences of climate change and preserve the various functions of the forest for society, and on the other hand the forest should be preserved as the basis for family businesses.

Montecuccoli puts the costs for silvicultural measures at up to 20 euros per cubic metre. The overall increasing costs and the necessary investments in the forest of the future are a fact. However, it is not certain whether the current efforts of the forest owners will also bear the desired fruits in the future: will young trees, which are now planted with great care and taking into account an increasingly dynamic climate change, survive until their planned harvest in 60 to 80 years? “We are currently acting with many question marks and under the motto: We know that we do not know everything,” said President Montecuccoli with concern. “What we know for sure: through silvicultural measures and regeneration, the times until a harvest are reduced from 100 years earlier to 60 to 80 years in order to minimize the risk of calamities as much as possible.”

The modern forester is increasingly becoming a manager

Professional forest management and well-trained employees will become increasingly important for companies that are subject to increasing dynamics in the future. In total, the management and administration costs including taxes and duties are currently almost 35 euros per solid cubic meter of wood harvested. This corresponds to a share of more than one third of the total costs.

European politics inhibits active climate protection measures

Land&Forstbetriebe Österreich are particularly concerned about the contradictory political “projects” of the EU. Thus, these necessary adjustment measures are clearly thwarted by unrealistic legislative proposals from Brussels. Instead of active forest conversion and conscious risk minimization, the specifications of the EU Biodiversity Strategy and Forest Strategy provide for 10 percent of the land area to be put out of use and thus left to their fate. The introduction of tree species that are fit for the future is seen as a disruption to natural forest communities, and forest stands should grow as old as possible despite the increasing risk. The nature restoration bill proposes restoring ecosystems to a state they were in in the past, rather than taking into account the dynamics of climate change.

The final round of negotiations on the EU Renewable Energy Directive (RED III) is expected to take place today in Brussels. Felix Montecuccoli has a clear opinion on this: “The fact that cascading use should now be prescribed completely contradicts the reality of the forest, where wood is produced during maintenance interventions, for example, that cannot be used in any other meaningful way than energetically. The introduction of so-called “no-go areas” is also intended to completely ban the production of energy wood on certain forest areas. This also endangers the urgently needed forest conversion there.” (Conclusion)

PS: Photos for this press release will soon be available on the press page of the Land&Forst companies.

Land&Forst Betriebs Österreich is the voluntary association of Austrian land managers with the aim of preserving Austria’s forests and fields as a basis for business and social added value and to create awareness of the concerns of private agricultural and forestry companies and their activities. The member companies of Land&Forst Betriebe Austria together manage more than a quarter of the Austrian forest and produce every fifth ton of Austrian grain.

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