Material substitution between coniferous, non-coniferous and recycled biomass - Impacts on forest industry raw material use and regional competitiveness

The competitive advantage of traditional forest industry regions such as North America, Russia and the EU is based largely on the production and processing of coniferous (C) biomass. However, non-coniferous (NC) and recycled (R) biomass provide cost-effective alternatives to C biomass, which have already decreased the proportion of C biomass use and which can potentially have large impacts on the future development of the global forest sector. In this study, we investigate the impacts of material substitution between C, NC and R biomass on forest industry raw material use and regional competitiveness from 2020 to 2100. The analysis is based on a global spatially-explicit forest sector model (GLOBIOM-forest). Our results indicate that traditional forest industry regions can maintain their competitiveness in a baseline scenario where C and NC biomass remain imperfect substitutes, and the development of the circular economy increases the availability of R biomass. Limited availability of R biomass would increase the competitiveness of traditional forest industry regions relative to the baseline. On the other hand, a perfect substitution between C and NC biomass would decrease the competitiveness of traditional forest industry regions relative to the baseline, and increase the competitiveness of emerging forest industry regions such as South America, Asia and Africa. We also show that the increased availability of R biomass tends to decrease demand for pulpwood and might lead to an oversupply of pulpwood especially in traditional forest industry regions. This opens new perspectives for pulpwood use and/or forest management in these regions.