1. Forestry Legislation Renewal and Implications to Forestry in Finland
TTS Työtehoseura – Work Efficiency Institute Managing Director Juha Ojala

2. Backround: Forestry in Finland
Forest land 20.3 million ha
Growing stock 2.4 billion m3
Annual increment 105 million m3/a
Forest ownership;
- Private 61%: forest owners
- State 21%
Share in GDP:
Forestry 1.9%
Forest based industry 2.0
Forest sector in total 4.9%
Gross stumpage earnings € billion/a (for forest owners)
Costs of silvicultural and forest improvement work € million /a
Gross value of the production of forest industries € 20 billion /a
Total goods exports bill. €/a (=24% of the total value)

3. Active Forest Policy Since the 1960s
Annual growth and harvesting of forests
Increased investments in silviculture since 1960’s
Potential: total harvesting can be increased by million m3/a
Annual growth
Drain
Pine
Spruce
Increment by treespecies
Broadleaved 3 3

4. Active Forest Policy Since the 1960s
Total growing stock volume has increased 50% in 50 years
Total
Pine
Spruce
Broadleaved 4 4

5. The Overhaul of Forest Legislation 2011-
Programme of Prime Minister Jyrki Katainen’s Government (2011):
“The economic base of forestry and forest industry must be reformed through the overhaul of forest legislation, securing both biodiversity and the multiple use of nature and the interests of the national economy, users of wood, and forest owners.
The reform will promote sustainable and increasingly diversified forest management and forest regeneration”.
Finland's forest resources allow for the increase in the sustainable use of wood as a raw material. This requires
active utilisation of forests,
a functioning wood and service market and
new innovations and investment.

6. Background of the Overhaul of Forest Legislation
The main goal was to:
Create good preconditions for the versatile use of forests and for new business activities and new investments
Improve the profitability of forestry
Create equal competitive positions to all actors in the market
Secure the growth and biodiversity of forests
A key method in the overhaul was the reduction of detailed regulation targeting forest owners and actors. Regulations that unnecessarily limit the economic utilization of forests or the development of the service markets should be removed.
In Finland the use of forest has been regulated by the state authorities already for centuries. Before reform there was comprehensive and strict regulation of e.g. regeneration age and size, tree species to be planted, harvesting methods, market restrictions etc …

7. Background of the Overhaul of Forest Legislation …
Finland has about forest owners with diverse goals and values how to utilize their forests. Forest owners are the decision-makers in their own forests.
Some active forest owners emphasize the economic output of forests more strongly than before, but many put more emphasis on factors such as the recreational use of forests, as well as values related to the landscape and diversity, and the combinations of these goals.
Changed attitudes of forest owners are bringing about a new kind of demand also on the forest service market.
Some forest owners do not need any special advice or promotion of their interests in caring for their own forests.

8. Comprehensive Reform of Forest Legislation 2011-2016
Reform of the Forest Act
Reform of the Forest Management Association Act
Reform of forest administration 2012 – 2016:
Finnish Forestry Centre 2012 and 2015 – Reform of the role and organization - Business activities privatized 2016
Forestry Development Centre Tapio > limited market-driven company (state owned)
Metsähallitus (State Forests) - State enterprise; forestry business unit incorporated 2016
Act on the Financing of Sustainable Forestry (state aid)
Forest Damages Act
Timber Measurement Act and
The Act on the Placing on the Market of Timber and Timber Products

9. Case - The Forest Act
Strict regulation in managed forests has previously imposed restrictions on the appropriate care for forests and has weakened the profitability of forestry. In addition, the lack of alternatives has sometimes left forests completely outside active care.
The renewed Forest Act gives forest owners a more diverse selection of forestry methods and alternatives for growing forests - more freedom to choose for forest owners. Also more responsibility to forest owners.
The Forest Act defines the minimum obligations of forest owners in the care of their forests and the minimum restrictions on forest use.
Freedom of choice is needed so that the varied goals of forest owners can be better adapted to one another:
The Forest Act now permits growing forest with diverse age structure.
Any restrictions for tree size and stand age are no longer required to allow regeneration cuttings.
A number of habitats of special importance were added whose characteristics need to be preserved.

10. Case - The Forest Management Associations Act
There are 80 forest management associations with a total of about 280,000 members. The purpose of forest management associations is to promote the profitability of forestry practised by their members.
In private forests the associations implement:
80% of silvicultural work
70% of timber sales plans
40% of timber sales on behalf of forest owners
Previously it was obligatory to forest owners to be a member (statutory fee).
Forest management associations had also restrictions on how to compete in the market (not allowed to buy and sell timber)
Reform: No statutory fees to forest owners, voluntary membership and no longer restrictions to associations to compete in the service market –> equal competitive positions and freedom to choose service provider

11. Conclusion - The Reform of Forest Legislation
More freedom – less regulation
More responsibility
Better motivation
Better profitability
New innovations
New investments to forestry and forest based industry

12. What has happened … Forest industry investments in Finland 2009 - 2016
SOURCE: Finnish Forest Industries, Statistics Finland, forecast Confederation of Finnish Industries, FFIF

13. What has happened … Investments and Additional demand for wood
During 2005 – 2012 reductions were huge in the pulp and paper industry as well as in the sawmill industry
During recent years new investment plans has been published:
New demand:
Logs ~1,5 Mm3
Pulpwood ~20 Mm3
Energywood ~4-5 Mm3
Recent and confirmed investments
Preliminary investment assessments
SOURCE: Finnish Forest Industries, Statistics Finland, forecast Confederation of Finnish Industries, FFIF

14. Thank You!

15. Additional information:
Finnish Forest Center
The Finnish Forest Centre is a state-funded organization covering the whole country promoting forestry and related livelihoods, advising landowners on how to care for and benefit from their forests and the ecosystems therein, collecting and sharing data related to Finland's forests and enforcing forestry legislation.
Metsään.fi-eServices offer the latest information directly to forest owners on their properties.
The Finnish Forest Centre operates under the guidance of Ministry of Agriculture and Forestry.

16. Additional information: Metsähallitus - State Forests
Metsähallitus is a state-owned enterprise that runs business activities while also fulfilling many public administration duties.
Metsähallitus administers more than 12 million hectares of state-owned land and water areas. Metsähallitus has the challenging responsibility of managing and using these areas in a way that benefits Finnish society to the greatest extent possible.
Metsähallitus operates under the guidance of Ministry of Agriculture and Forestry.

17. Additional information: Forest Management Associations
Organization for forest owners
Finland is a land of family forests. Two-thirds of the Finnish forests are owned and managed by private individuals.
The Forest Management Associations serve forest owners in practical forestry issues and look after the interests of forest owners at the local level. The organizations for forest owners look after the regional interests.
There are members in the associations.

18. Additional information: Tapio Oy - Forestry Development Centre
Tapio consulting services provide solutions for efficent and sustainable forest management and bioeconomy.
Tapio provides services both for public and private sector. Tapio has over a century of experience in developing sustainable forest management.