As Latvia is one of the greenest nations in Europe and forests cover around half of its territory, the forest industry for centuries has been strategically important to the national economy. Today, the woodworking sector is one of the key export industries and plays an essential role in creating rural and regional employment.
The industry's success lies in Latvia's favourable combination of vast forest resources, strategic location and a cost-efficient labour force. Additionally, government policies aimed at achieving sustainable forestry development have supported the industry.
Sawmilling, wood chips and pallets, panels, furniture, and plywood
- In Japan, it’s called shinrin-yoku (forest bathing); in Norway, it’s friluftsliv (appreciation of outdoor activity and nature). But, in Latvia, it’s just a normal day outside, as forests in our country take up to 3.4 million hectares of land or 52% of the country’s territory.
- Our forests are growing. With a total growing stock volume of 677 million m3, Latvia is the fourth most forested country in Europe. The amount of forestland keeps expanding, and the volume of timber in the forest is increasing three times more than the area of forestland. To keep the forestry sector sustainable, on average 9.4 thousand hectares of soil is prepared each year and an area of 8.1-9.3 thousand hectares is regenerated.
- Who owns this green gold? The State of Latvia owns around one-half of the country’s forests, while most of the remaining forest belongs to approximately 135’000 private owners. Also, eight associations of Latvia’s forest industry joined together to form the Latvian Forest Industry Federation, ensuring the international representation of the industry’s interests.
- This industry is very export-oriented. Here are some numbers to help you understand the equation. The forest sector contributes ~30% of total Latvia’s exports or 2,6 billion EUR. Currently, we are exporting more than 71% of forest sector output, indicating the historically high quality of Latvian woodworking products. Forestry, wood processing, and furniture making represent around 5% of GDP.
- Wood products made in Latvia can be found in many parts of the world, as our major export markets are United Kingdom (17%), Estonia (12%), Germany (8%), Denmark (7%), and Sweden (11%).
- Foreign investors have an eye on our woodworking industry. At the end of 2019, foreign direct investment in the particular sector reached more than 500 million EUR. The flow of foreign investment increases yearly.
Employment and education
- The great news is that we can create workplaces and a lot of them in this case! The woodworking sector is one of the biggest employers in Latvia, employing around 39 thousand people.
- Emerging professionals interested in forestry have plenty of options. They can choose any of the 14 professional educational institutions, such as the Forest Faculty of the Latvian Agricultural University (LLU), the Textile Technology and Design Institute of the Riga Technical University, and the Faculty of Material Sciences and Applied Chemistry.
- For your company to be successful, you need great specialists who could keep up doing the good work! In the forest faculty, the total number of students in 2019 amounted to 525, and 75 fresh forest sector graduates joined the labour market.
- Latvijas Finieris (“Latvian Plywood”) key operational areas are production and sales of birch plywood and development of new birch plywood products. Today, “Latvian Plywood” has grown internationally with production facilities in Latvia, Lithuania, Estonia, and Finland, as well as 12 fully owned product development and sales companies in Europe and overseas. Their turnover reaches 250 million EUR. The products are sold in more than 60 countries.
- Latvia’s State Forests pursue state interests in forestry by sustaining and increasing the forest value while gaining maximum possible profit from forest management. For this purpose, it employs more than 1000 people.The annual turnover of “Latvia’s State Forests” is around 275 million EUR.
- Cross Timber Systems is the biggest company producing Cross-Laminated Timber panel products across Northern Europe and Scandinavia. Their manufactured product as a construction solution is less expensive, less waste-producing, and provides shorter construction time, more durability, and better logistics. Cross Timber Systems' annual production capacity is 25 000 m3.
- Latgran is a Latvia-based producer of wood pellets for the industry. The company was founded in 2004. Estonian “Graanul Invest” owns the company. Latgran has more than 100 employees, and it produces over 500 000 MT of wood pellets per annum in 4 factories in Latvia. The company’s products are chemical-free and classify as environmentally friendly fuel.
- Stora Enso is one of the world leaders in developing solutions based on wood and biomass for a range of industries and applications. Globally it employs around 26 000 people in 30 countries, and their sales exceed 10 billion EUR. The company in Latvia has a sawmill and a packaging factory.
- Kronospan is the world leader in wood panel manufacturing, established in Austria in 1897. Group consists of more than 40 factories worldwide and employs 14 000 people. They opened their manufacturing facility in Latvia in 2005. Today, their turnover in Latvia has reached more than 230 million EUR per annum.