Economic costs of illegal logging

Trees gone and billions lost

Illegal logging activities leave a clear mark of destruction in forests - gaping holes, where once stood ancient trees that may have housed a resting jaguar, orangutans and a host of other smaller animals.

But there’s another cost: lost revenue that may have been generated from legal logging of forests. So what’s the bill for illegal logging?


When trees are cut without the right permits and are smuggled abroad, governments lose out financially in several ways including lost revenue from taxes and duties and costs of efforts to manage illegal logging.

A vicious circle that pushes down the market price of timber

Timber that is logged without payment of duties and taxes pushes down the market price of timber, which acts as an incentive for other loggers to follow the same practice.¹ This further increases losses to governments.

A study by the American Forest & Paper Association has estimated that illegal logging depresses world timber prices by between 7% and 16% (depending on product). This causes US firms losses of at least US$460 million each year.²

Globally, billions of dollars lost each year

According to WWF, trade data for the Amazon Basin, the Baltic States, the Congo Basin, east Africa, Indonesia and Russia show that an estimated €10–15 billion are lost from illegal logging globally each year. The EU is responsible for almost €3 billion of this loss due to its trade with these six regions alone.³

Another estimate from the World Bank states that the annual global market loses US$10 billion annually from illegal logging, with governments losing an additional US$5 billion in revenues. ⁴