Volatile oil receipts and weakening fiscal buffers have intensified Nigeria’s push for resilient growth sectors. Beyond the frequently cited pillars of agriculture, solid minerals and manufacturing, forestry is regaining traction in high-level economic discussions.

The global forestry and logging market is expanding at a pace that underscores the scale of the missed opportunity. Valued at about $980.05 billion in 2024 after growing at a compound annual growth rate (CAGR) of 8.17 per cent since 2019, the market is projected to reach $1.42 trillion by 2029 and rise further to $2.18 trillion by 2034, according to ResearchAndMarkets. The trajectory reflects strong structural demand for wood products across construction, packaging, furniture and renewable materials.

Abundant forest resources across key regions give Nigeria a natural platform for forestry-led diversification. The determining factor, according to industry analysts now, is institutional reform and the ability to channel private capital into a sector that is expanding globally.

Global momentum and structural drivers
The forestry and logging industry encompasses logging operations, timber tract management, forest nurseries, gathering of forest products and complex supply-chain activities that convert roundwood into sawnwood, panels, pulp and biomass. More than 4 billion cubic metres of roundwood are harvested globally each year. In 2022 alone, about 1.5 billion cubic metres of industrial roundwood were processed into sawnwood, panels and pulpwood.

Reports show that forests cover approximately 31 per cent of the Earth’s land area, about 4.06 billion hectares, forming the biological base of an industry increasingly aligned with global sustainability goals. About 45 per cent of global industrial roundwood production goes into sawnwood, while the remainder is channelled into pulpwood, wood-based panels and biomass.

Growth in recent years has been propelled by heightened demand from the pulp and paper industry, an increase in residential and commercial interior fit-outs, and the accelerating adoption of wood-based sustainable building solutions. The packaging sector’s shift towards wood fibre as an alternative to plastics has further strengthened demand.

Looking ahead, the popularity of modular and prefabricated housing, government-backed reforestation initiatives and rising appetite for luxury furniture are expected to sustain momentum. Yet the industry faces headwinds including high operational costs, competition from flexible packaging materials, exposure to climate change and natural disasters, and increasingly stringent deforestation regulations.

Regionally, Asia Pacific commands nearly 55 per cent of the global market, reflecting industrial demand from China and neighbouring economies. North America and South America remain significant producers and exporters. However, Africa and the Middle East are forecast to record the fastest growth rates over the coming decade, with projected CAGRs of 24.06 per cent and 17.36 per cent respectively.

The competitive landscape remains fragmented. The top 10 companies account for just 0.79 per cent of global market share. Finland’s Stora Enso Oyj leads with 0.31 per cent, followed by Sweden’s Svenska Cellulosa Aktiebolaget and the United States-based Weyerhaeuser Company. The concentration indicates ample room for new entrants, particularly from resource-rich regions willing to align extraction with sustainability standards.

Nigeria’s forest reserves once underpinned its economy. In the 1950s and 1960s, agriculture (inclusive of forestry), accounted for more than 80 per cent of GDP before the discovery of crude oil shifted the country’s economic structure. Timber exports were a major source of foreign exchange.

Today, the sector’s contribution is marginal. Between 2011 and 2015, Nigeria exported timber valued at $400.2 million, significantly behind regional peers such as Cameroon and Gabon. Analysts attribute this underperformance not to a lack of biological resources but to weak institutional frameworks and persistent illegal logging.

The Food and Agriculture Organisation (FAO) estimates that between 2000 and 2005, Nigeria lost 55.7 per cent of its primary forests to illicit timber trade, uncontrolled deforestation and tree felling without meaningful replanting. Data from Global Forest Watch indicate that the country lost 567,371 hectares of forest by 2006 and approximately 14 per cent of its primary forest between 2002 and 2020.

Despite laws requiring logging licences issued by state forestry departments, enforcement has often been lax. Investigations by the International Centre for Investigative Reporting (ICIR) have highlighted how traders frequently bypass official channels, harvesting timber, including high-value species such as rosewood, without effective oversight.

Because forestry is constitutionally managed at the state level, disparities in regulatory capacity and local governance have created loopholes. Weak monitoring systems and allegations of corruption have allowed illegal operators to flourish, depriving governments of revenue while accelerating forest depletion.

Untapped biodiversity and value chains
Industry stakeholders argue that Nigeria’s forestry story is far from exhausted. The country possesses over 600 potential timber species, yet fewer than 30 are commercially exploited for international trade. This narrow utilisation reflects limited research, inadequate processing capacity and insufficient market development.

Wood Expo Nigeria (WEN), an industry convergence forum, has consistently called for a comprehensive “whole wood” strategy, one that spans seed collection, plantation development, sustainable harvesting, milling and downstream manufacturing of furniture, structural elements and building components.

Such an integrated approach, the association noted, would shift the sector from raw log exports towards higher value-added products. Globally, engineered wood, laminated timber and prefabricated wooden components are gaining market share in construction. Nigeria could position itself not only as a supplier of raw materials but as a manufacturing hub serving both domestic and regional markets.

The African Continental Free Trade Area offers additional opportunities for intra-African trade in processed wood products. If Nigeria can align quality standards with international certification schemes, it could tap into rising demand from Europe and Asia, where sustainability credentials increasingly influence procurement decisions.

The Food and Agriculture Organization Corporate Statistical Database ranks China as the world’s largest timber and wood products importer. China’s rapid urbanisation and expansion in construction, papermaking and furniture manufacturing continue to drive global timber flows. For Nigeria, access to such markets depends on reliable supply chains and credible forest management systems.

Governance, enforcement and reform
Civil society groups, including the Nigerian Human Rights Community, have called for sanctions against foreign and local actors implicated in illegal timber exports. They have urged the establishment of presidential probe panels and judicial commissions of inquiry in affected states to identify and prosecute offenders.

Yet analysts caution that punitive measures alone will not suffice. Orimoloye Faleyimu, a forestry management lecturer and researcher, argues that the structural model of forestry as a predominantly public venture has constrained innovation and accountability. He advocates requiring private firms that extract forest resources to reinvest a portion of profits, as much as 25 per cent of gross profit, into regeneration and re-afforestation programmes.

He also stresses that legal reforms must be matched by institutional reforms. Forestry departments need to become more outcome-oriented, transparent and technologically equipped. Satellite monitoring, digitised licensing systems and transparent concession allocation could significantly reduce leakages.

Globally, more than 70 per cent of harvested wood now originates from managed forests under sustainable certification schemes. Selective logging accounts for 60 per cent of operations in many regions, replacing environmentally destructive clear-cutting practices. For Nigeria to compete, it must align with these evolving norms.

Private capital and plantation forestry
There is evidence of growing private involvement in plantation forestry in Nigeria. Industrial plantations, typically comprising fast-growing species cultivated under controlled conditions, can ensure predictable supply for sawmills and panel manufacturers while reducing pressure on natural forests.

Stakeholders are urging federal and state governments to support industrial plantation development through clear land tenure frameworks, long-term leases and access to finance. Concessional credit lines, tax incentives and public-private partnerships could catalyse investment.

The three tiers of government are also being encouraged to adopt an integrated forestry policy system that combines indigenous forest management practices with modern scientific methods. Land restoration programmes, if structured inclusively, could reduce communal conflicts while generating rural employment.

Source: businessamlive.com