The UK commercial forestry market saw a softening in the average price paid in 2025, according to a new report.
Forestry and woodland specialists John Clegg & Co’s annual Forest Market Review depicts mixed fortunes for the sector, with a record £250m+ worth of plantation sales recorded but masking what has become a slower, more variable market.
At first glance, the market in 2025 looks to have been incredibly strong,” said Simon Hart, Head of Forestry in Scotland.
“A total of 11,300 stocked or plantable hectares were sold which is more than double the area sold in 2024, with a cumulative selling price of £261m – a new high.
“However, more than half of this was accounted for by three large sales- the Griffin sales (Lots 1 and 2) and the Caledonian and Irish Portfolio, which were so large they mask the underlying trends.”
Mr Hart says the evidence is clear the plantation market slowed last year with more forests selling within the £10,000 – £20,000 bracket than for some time.
In addition, only 45% of sales were completed within six months of launch and a third took over a year – which are the lowest percentages for 10 years.
Average sale prices were 102% of the guide and 30% sold for less than the guide price.
“Excluded from these figures are also woods that remain for sale or have been quietly withdrawn from the market,” added Mr Hart. “Our sense is that a 10% drop in average plantation values is a truer reflection of the market.”
A flat timber market, interest rates being higher than many have been used to, uncertainty over import and export tariffs and the changing inheritance tax rules were all factors.
Timber returns remain well down on the immediate post-COVID peak, but the cost of restocking and maintenance has continued to rise by more than inflation.
“Put these factors together and the economics of productive forestry on poorer sites, distant from markets, start to look challenging and even relatively mature spruce woods can struggle to achieve £10,000/ha. Yet at the same time, woods close to markets are still selling well, with a few mature spruce properties selling at over £40,000/ha.”
Looking ahead, Mr Hart says realistic pricing is essential if sellers want a sale in the short term.
“If the price is too high in this current market, then it is hard to persuade potential investors to even inspect the property.”
But with forestry owners often being wealthy individuals with well-balanced investment portfolios they usually have the option of being able to wait for better times.
“The forestry investment fundamentals remain in place – an underlying biological growth driver, a largely benign tax regime and strongly rising global demand for timber. But until that translates into improved domestic timber prices, the forestry land and plantation market is likely to remain cautious.”
