_pages-to-jpg-0001.jpg)
Ingka Investments, the investment arm of the Ingka Group and the largest IKEA franchisee, is making its biggest forest land acquisition to date, purchasing approximately €720 million ($840 million) worth of land in Latvia and Estonia. The move is aimed at securing a well-managed, sustainable source of raw material for IKEA furniture and aligns with the company’s long-term sustainability goals.
The deal, announced on Monday, involves around 153,000 hectares (380,000 acres) of land purchased from Sweden’s forest owners’ association Sodra. Nearly 90% of the acquired area is forested, providing a significant supply of wood. Ingka Investments said the purchase is part of a strategy to strengthen local value chains while investing sustainably in natural resources that will serve the company for generations.
Peter van der Poel, Managing Director of Ingka Investments, explained that the company seeks to take a “generational view” of forest management. The plan involves working closely with Baltic sawmills and panel manufacturers to process wood regionally, supporting local economies while reducing the environmental footprint of raw material transportation.
Ingka Group, which operates IKEA stores in 31 countries and accounts for 87% of global IKEA retail sales, already manages 331,000 hectares of forest land across seven countries. The company’s forests are owned by a charitable foundation, which reinvests profits into the business and sustainability initiatives rather than distributing dividends. This new acquisition adds substantially to Ingka’s existing portfolio, demonstrating the group’s commitment to sustainable supply and long-term resource management.
The Baltic forest purchase is part of Ingka’s broader investment strategy, which has seen the company invest over €1 billion in recent years. Recent acquisitions include the artificial intelligence logistics platform Locus, a flagship retail and office property in Manhattan for a second IKEA store, and a minority stake in Vanguard Renewables, a company that converts food waste into renewable natural gas. These investments reflect a focus not only on growth and expansion but also on sustainable technologies and energy-efficient solutions.
Sodra CEO Lotta Lyra said that selling the forest land allows the cooperative to concentrate on increasing the value of its members’ Swedish forests, while also contributing to a sustainable and responsible global supply chain. The sale is currently subject to regulatory approvals, which are expected to be completed in line with European guidelines for such large-scale land transactions.
This acquisition underscores IKEA’s commitment to sustainable business practices. By owning and managing forests, Ingka can ensure that the company has a reliable, renewable supply of wood, which is a core material for its furniture production. The strategy also reduces dependence on third-party suppliers, provides control over sustainable forestry practices, and ensures that environmental standards are met across its supply chain.
In addition to sustainability benefits, the move strengthens regional economies by creating partnerships with local sawmills and panel producers, fostering jobs, and supporting industry development in the Baltic region. By processing wood locally, IKEA can also reduce its carbon footprint associated with transportation, aligning with its broader climate goals.
The Baltic forest acquisition reflects IKEA’s holistic approach to long-term resource management, combining economic, environmental, and social objectives. Ingka’s strategy illustrates how large corporations can integrate sustainability directly into their supply chains while supporting local communities and preserving natural resources for future generations.
This latest investment positions Ingka as a global leader in sustainable forest management, reinforcing IKEA’s reputation as a company committed to environmental stewardship while ensuring the long-term availability of essential raw materials for its products.
