Germany’s forest sector

-1-Uwe Kies, Dresden, Sep 16, 2010Wald-Zentrum

Germany’s forest sector

National benchmarks, regional clusters and therole of network initiatives

Dr. Uwe KiesWald-Zentrum, University of Münster, [email protected]

EFI Annual Conference 2010, Dresden, Sep 16, 2010

mailto:[email protected]




The Forest Sector: a deep value-added chain

Outline

Forest sector concept

Findings from German case study

Forest cluster organization in the EU


The Forest Sector: a wood-based cluster

Publishing,

printingPaper

manufacturing

Suppliers

NWFP,

ServicesPaper

production

Sawmilling

Panels

Energy

Packaging

Crafts

Furniture

Forestry

Construction

-An obvious concept ofa peculiar sector

- Forest-based industries

- Filière forêt-bois

- лесного комплекса (Forest complex)

- Metsäklusteri

- Cluster Wald und Holz


The Forest Sector: a major force in employment

-Key figuresEmployees Europe Germany

(2005, EUROSTAT) (2008, BA)

Cluster total 5.4 million 857,200

Cluster, excl. publ. & printing: 3.6 million 550,300

Share of total economy (A-O) 3.3% 3.1%

Share of prod. industries (C-F) 15% 9.5%

Country/State variances 11-34% 4-12%

(DE, LV) (SAA, S-H)


Germany’s forest sector: National trends

-An unexpectedly large sector ... ... yet in disproportional decline

Cluster total: -412,400; -32%Wood industries: -65,000; -32%

2008

6th rank position amongproducing industries (NACE C-F)


Germany’s forest sector: Regional impact

Forest clustershare of

employeesin German

counties2008

-Regional forest sectors

-... can obtain leading positions in regional economies

-Up to 15-20% of total employees,large deviation from nationalaverage of 3%

-... ensure employment in rural environments

-Concentrations located inborder locations and weakly industrialized regions


Germany’s forest sector: Regional clusters

-Sawmilling, 1999-2008

-Large clusters in West Franken (BW) -> growing,Black Forest (BW), Sauerland (NW), Niederbayern (BY) -> declining

-Local concentrations in EastIsolated, but growingEmerged anew after 1990

-Cut-throat competitionLarge & growing locations vs.Small & declining in their vicinity-> on-going structural change



-Wood-based panels, 1999-2008

-Outstanding cluster in NRW5,000 employees (30%) in7 neighbouring counties

-Declining locations in WestStrong losses in NRW and B-WExtinctions in Bavaria

-Growing locations in EastNew foundations Small local concentrations



-Paper production, 1999-2008

-Major cluster in NRW5,500 employees (28%) inRhineland region

-Southern locations declineStrong losses in Bavaria

-On-going concentrationLarge & growing locations vs.Small & declining


Germany’s forest sector: Regional trends

-Western vs. Eastern Germany,small vs. large scale

-Smooth decline in Westin total: -8,300

-Structural shift in EastSmall + medium: -900 (-27%)Large: +1,600 (+178%)

-Locational factorslabor costs, land values, advantageous infrastructure,and:

-Questionable role of federal subsidies !

Sawmilling, 1999-2008

totals in bold, changes in italics



-Networks and cluster initiatives

-EstablishedScandinaviaUKAustriaCzech RepublicSlovenia

-EmergingGermanyFranceEastern Europe

-EmbryonicBalkan

Kies 2010 (non representative survey)



-Improving inter-industry communication viaknowledge exchange, networking, innovation

Building networks among industry, public authorities & research

Joint interest representation in politics (lobbying)

Initiation of legislative reforms

Public relations & marketing

Information systems, platforms

Education & qualification

Business development, spin-offs

Logistics, supply chain management

R&D for innovation

Wood mobilization !

A multitude of specific collaborative projects ...



Selected established initiatives

www.forestryscotland.com ; www.holzcluster-steiermark.at ; www.cluster-forstholzbayern.de ; www.msdk.cz ; http://grozd.sloles.com/en ; www.zimit.de ; www.paperprovince.com

Moravian Silesian Wood Cluster

Slovenian Wood Industry ClusterGerman furniture cluster

http://www.forestryscotland.com/

http://www.holzcluster-steiermark.at/



http://www.cluster-forstholzbayern.de/



http://www.msdk.cz/

http://grozd.sloles.com/en

http://www.zimit.de/

http://www.paperprovince.com/


The Forest Cluster: Conclusions (1)

-An “unknown, sleeping giant” ?

Rooted in the regions, the sector is a vital source for value added and

employment in local SMEs, not only in rural areas. Its major contribution to

macro- and regional economics is largely underestimated even in the

sector itself, and hence not fully recognized in economic policy.

Its basis are an abundant natural resource (forest), a primary material with

excellent properties (wood) and multiple advanced and environmentally

sound end uses: these represent decisive strengths and untapped

opportunities for regional sustainable development.

However, the fragmented, poorly organized sector needs

to join its forces, bridge the gaps between forestry and

wood processing and advocate its case with one voice.

Uwe Kies, Dresden, Sep 16, 2010



-Structural change and its impacts

But: The massive structural change will continue to have wide ranging

effects on timber production, markets, prices and hence overall

regional availability, putting regional procurement security at stake.

Enlargement and relocation of single processing capacities has seldom

been a success story from a regional economics perspective. After all,

increased wood mobilization does not necessarily entail

growth in wood industry employment.

The dynamics of regional clusters, (co-)agglomerating

branches and underlying formation factors need

to be well understood and should be the starting point

for intelligent cluster development policies.




-Lessons learnt from networks and cluster initiatives ?

Networks and clusters can stimulate innovative business potentials and

stabilise negative employment trends in the wood industry, yet their

capacity to ensure long term growth still needs to be demonstrated .

The majority were initiated with considerable governmental funding,

yet during their consolidation few managed to become self-supporting

based on membership fees and fund raising.

Their major opportunities, but also major challenges lie in their

proper definition of their role as a facilitator and promoter

of joint collaboration and the need to offer competitive

support services to their members.



Thank you for your kind attention !

www.wald-zentrum.de/[email protected]

www.in2wood.eu

-Kies U., Klein D., Schulte A., 2010. Germany’s forest cluster: exploratory spatial data analysis of regional agglomerations and structural change in wood-based employment. Primary wood processing. Forstarchiv 81(6), 236-245. www.forstarchiv.de

http://www.wald-zentrum.de/kies






http://www.in2wood.eu/

http://www.forstarchiv.de/

Germany’s forest sector

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