“2005 was a time when politicians were striving for a leaner state. The Bavarian State Forests (BaySF) were intended to contribute to this by limiting the intervention and tasks of the state to what was absolutely necessary,” Martin Neumeyer, then spokesman for the Bavarian state government under Minister-President Edmund Stoiber, recalls. The Austrian Federal Forests (ÖBf AG) served as a model – profit-oriented, but also controversial. Accordingly, even before the company was established, there was a popular initiative called “Out of Love for the Forest” in Bavaria, which warned against sell-offs, access restrictions and the like. However, it narrowly failed to reach the required 10% hurdle.
We are doing everything we can to make sure that spruce is brought to market in an orderly manner for as long as possible.
Freidhager: Market orientation and structure
“Freidhager was the right man at the right time,” Neumeyer emphasizes. The Upper Austrian brought with him over ten years of experience at the Austrian Federal Forests (ÖBf). As a non-Bavarian, he was considered politically independent – an advantage when BaySF started out.
The economic framework conditions at the company’s launch were favorable. An annual logging volume of 5.4 million m³ met ever-increasing cutting capacities, harvesting costs were nearly €20/m³ lower than those in Austria, and the economy was booming. The BaySF, and thus Freidhager, had many aces up their sleeves.
However, one well-intentioned measure proved counterproductive: A long-term, fixed-price supply contract with the Klausner Group placed a heavy burden on the company. The political will to secure a major customer right at the beginning led to estimated revenue shortfalls of over €100 million between 2005 and 2015 during times of rising log prices.
Freidhager introduced “ex works” prices and in-house key account management early on – measures that are still in place today. Despite the 2008 financial crisis and difficulties with major customers such as Rettenmeier and Klausner, BaySF were able to assert themself economically. The Freidhager era in figures: “Between 2005 and 2015, around €600 million were paid to the Free State of Bavaria, excluding bank liabilities and EBIT of €48 million in 2014.”
Neumeyer’s term of office: Crisis management and climate change
Martin Neumeyer took office in 2015, immediately after a severe storm. Since then, his term has been marked by various events leading to the accumulation of damaged wood, and the impact of climate change – especially since the hot summer of 2017. The result: a massive drop in prices that lasted until 2020. Today, the BaySF generate annual EBIT of around €40 million with a harvest of about 5 million m³ a year.
The focus is now more on changing the composition of forests and securing timber stocks. In 2024 (fiscal year), damaged wood still accounted for 60% of the total harvest volume. In 2025 (fiscal year), this share is expected to fall to around 30%. In the long term, softwood will continue to dominate. “I expect that we will continue to harvest productive spruce stands in the future, too, especially in the Alps, the Alpine foothills, and the low mountain ranges,” Neumeyer explains. Helping to maintain the production site in Plößberg/DE, in which the Rettenmeier Group intends to invest, is part of this strategy.
On the path to land management
In addition to the core business of forest conservation, change, and timber sales, new business areas are gaining in importance: wind power and nature conservation compensation. By 2030, around 500 wind turbines are to be built on land owned by the BaySF – primarily through leasing models, not through investments. The BaySF are already generating substantial revenue from the provision of compensation areas. Neumeyer says: “We are gradually becoming a land manager.”
In recent years, another focus has been on crisis prevention, particularly by creating large wet storage capacities. This has been successful: Up to 1.5 million m³ of log wood can be stored wet at short notice – thereby preserving the value of the wood and stabilizing the market.
Forest before game – a successful balancing act
What distinguishes Bavaria from Austria is the principle of “forest before game”. Both chairmen of the board emphasize its importance. “I tried to implement this principle at the Austrian State Forests, too,” Freidhager recalls and, looking back, he explains: “At the Bavarian State Forests, we are proving that a commercially managed forest reaches all ecological goals.” The popular initiative’s goal of securing 10% of the area for nature conservation purposes was exceeded. “Today, calls for large-scale set-aside are no longer the focus. Our task is to provide the sustainable raw material wood for decarbonization, which contributes to climate protection,” Neumeyer adds.
