Future Development of the Norwegian Forest Industry, Based on Industry Expectations

Abstract

Abstract Forest industries worldwide are facing a range of challenges, such as declining demand for newsprint, fluctuating sawn-wood prices, and society's concern of forestry's negative environmental impacts. On the other hand, the growing interest in bioenergy and renewable products may represent opportunities for the forest sector. Few assessments of the industry's expectations regarding future development of the major external forces driving the forest sector seem to have been carried out. We undertook two participatory surveys of sawn-wood industry managers in Norway in 2010 and 2013, assessing their expectations of how key factors develop until 2020. The respondents expressed beliefs that the demand for sawn-wood and bioenergy will grow and that sawmilling productivity will increase together with international trade. Society's concern for the environment was expected to rise, leading to higher demand for wood products but also more expensive forestry operations. A bioenergy demand increase of 50 percent, very high energy prices, competitive second-generation biofuel, and the first second-generation biofuel plant being established in Norway were perceived to be notably less likely in 2013 than in 2010. The questions were associated with scenarios of the Norwegian forest sector used in quantitative scenario analyses. In the 2013 survey, less support was given to the scenario with high priority on environmental issues and rapid bioenergy deployment. Recent policy and market shifts that imply a lower emphasis on the environment and cheaper fossil fuels may help explain this change. The survey indicates that short-term shifts in policy and economic factors may considerably impact key agents' assumptions about the future.