Montenegro’s wood-processing industry is facing production disruptions due to shortages of domestic timber, with approximately 4,000 jobs potentially at risk. The Chamber of Economy of Montenegro has warned that numerous processors failed to obtain timber allocations through the latest public procedure, leaving businesses uncertain about supplies needed to maintain production and fulfil customer contracts.
Industry representatives are calling for new timber allocation procedures and public tenders to be launched without delay to restore access to raw materials.
Timber Supply Disruptions Hit Northern Montenegro
The shortage is particularly significant in northern Montenegro, where forestry and wood processing provide industrial employment in municipalities with fewer alternative private-sector opportunities.
The sector includes sawmills, furniture manufacturers and other companies dependent on state forest resources. Reliable access to timber is essential for maintaining production schedules and making effective use of machinery, factory capacity and the workforce. When raw materials are unavailable, manufacturers continue to face fixed operating costs even as production slows. Importing timber is an alternative, but transportation expenses can make foreign supplies commercially unattractive.
Forest Management Reform Adds Transition Challenges
The supply difficulties coincide with Montenegro’s restructuring of state forest management through the newly established Crna Gora Šume company The reform could eventually introduce a more transparent and predictable framework for forest resources. The transition also carries a risk of supply disruption if clear allocation procedures are not established.
Wood processors are simultaneously preparing for potentially higher labour costs under proposed wage reforms. Rising wages combined with uncertain timber supplies could place additional pressure on smaller manufacturers, particularly those with limited financial flexibility.
Domestic Processing and Industrial Employment
Montenegro has sought to shift its forestry industry away from exports of low-value timber towards greater domestic processing. Furniture and other higher-value wood products retain more economic value within the country and support more employment than exports of unprocessed raw materials. Unreliable access to domestic timber could undermine that objective by preventing local manufacturers from maintaining production and developing higher-value products.
The immediate issue for the sector is continuity of supply while the state restructures forest management. Establishing a transparent timber allocation system with predictable access to raw materials is central to enabling manufacturers to plan production, fulfil contracts and make investment decisions while maintaining public oversight. The potential exposure of around 4,000 jobs underscores the importance of resolving the allocation problem for Montenegro’s manufacturing sector and regional economies.
