Market conditions remain largely unchanged from two years ago, with strong demand for sawtimber, coming primarily from pine trees in East Texas.

On the flipside, there is an oversupply of smaller-diameter trees, keeping pulpwood prices soft, Taylor said.

Texas' timber industry is experiencing steady markets in 2025. (Michael Miller/Texas A&M AgriLife)

East Texas timberland at the heart of production

Roughly one-fifth of the state, concentrated in 43 East Texas counties, provides about 12 million productive acres of timber out of roughly 22 million acres in the region.

Most of the land is privately owned, predominantly by small family landowners. A portion of the land is owned by timber investment management organizations and real estate investment trusts. An even smaller portion is public land.

The pine-dominated forests of East Texas supply dimensional lumber like two-by-fours and two-by-sixes, a backbone of the construction industry. Hardwood markets remain more variable, and the state’s pulp and paper industry faces continued challenges from oversupply, Taylor said.

Still, recent reinvestments and expansions by mills in the region signal confidence in the future of the Texas timber industry, he said.

Housing starts and timber markets remain linked

While the Texas timber sector generally operates as a net-importer state, trade with Mexico and Canada accounts for 88% of Texas’ exports and 42% of its imports in 2024, Taylor said.

The solid wood industry is closely tied to regional housing construction. Sawtimber markets are driven by demand for dimensional lumber and track trends in homebuilding, which have been mixed in recent years.

“Housing starts nationwide have slowed, and that does affect our markets to some degree,” Taylor said. “But Texas is doing better than much of the country. Housing construction here has held up relatively well. In fact, Texas housing starts have seen a recent increase after a two-year slowdown and that’s helped keep our sawtimber markets stable.” 

Texas remains a significant contributor to national new home construction, accounting for nearly 17% of the nation’s total new homes. Taylor added that steady homebuilding activity in Texas is one reason mills have reenergized and reinvested in operations, with some even expanding.

Mass timber and new markets show promise

One bright spot is the growing interest in mass timber, a group of engineered wood products that is increasingly used in multistory commercial buildings. Advances in manufacturing have allowed laminated solid wood products to meet strength, stability, and safety requirements for large, open-span, and/multi-story construction. Mass timber is often used in place of concrete or steel.

“Architects and engineers are increasingly recognizing the aesthetic appeal and energy-efficiency of wood and mass timber, making them a practical choice for larger-scale projects,” Taylor said. “It’s a renewable and beautiful resource that also saves on heating and cooling costs. That’s one of the more exciting developments we’re seeing.”

Helping small landowners manage and profit

While industrial and large landowners benefit from economies of scale, most Texas timberland is held in smaller tracts — often under 100 acres — where sustainable forest management can be cost-prohibitive. The Texas A&M Forest Service is addressing this challenge by expanding financial assistance programs to help small landowners pay for management practices like thinning, site preparation and planting.

A new cost-share program, expected to roll out this fall, will reimburse up to 80% of the costs of qualifying management activities.

“These programs make it possible for smaller landowners to actively manage their timber and keep their forests healthy, which is critical for reducing fire risk, minimizing losses to insects and disease, and maintaining productivity,” Taylor said.

Landowners can visit the Funding Connector to identify funding opportunities available for their specific properties.