SUSTAINABLE WOOD BIOMASS SUPPLY CHAIN IN A CIRCULAR ECONOMY: INSIGHTS FROM EMPIRICAL RESEARCH

25th international scientific conference Business Logistics in Modern Management October 2-3, 2025 - Osijek, Croatia 311 SUSTAINABLE WOOD BIOMASS SUPPLY CHAIN IN A CIRCULAR ECONOMY: INSIGHTS FROM EMPIRICAL RESEARCH Arkadiusz Kawa Poznan School of Logistics, Poznań University of Economics and Business, Poland E-mail: [email protected] Received: June 30, 2025 Received revised: August 2, 2025 Accepted for publishing: August 22, 2025 Abstract The wood biomass sector plays a crucial role in the transition towards renewable energy and a circular economy. Despite its ecological potential, the sector faces persistent challenges relating to logistics, waste valorisation, and regulatory ambiguity. This study cuts through the rhetoric of the circular economy to investigate how Poland’s wood industry keeps fibre in circulation rather than sending it to landfill. Three focus groups interviews comprising industry practitioners (18 participants from sawmills, furniture plants, recycling facilities and bioenergy production companies) revealed that almost nothing is wasted: clean wood chips are made into composite panels, offcuts are remanufactured or sold on, and unavoidable fines are used to feed pellet mills or in-house boilers. A key objective was to identify the technical, organisational and regulatory factors most likely to stabilise these processes in the event of cost or legislative changes. However, this apparent success is fragile. High diesel prices can wipe out the slim margin on low-value residues, labour shortages can slow meticulous sorting, and contaminated demolition timber is a major concern for the sector. Participants also complained about policy ambiguity and called for clearer end-of-waste criteria. Nevertheless, the group had a strikingly circular mindset: several mapped the journey from beam to mulch to ash-as-fertiliser without prompting, framing wood as a “resource in endless costume changes”. The paper argues that targeted incentives, such as fuel-tax relief for short-haul biomass and affordable on-site machines, could transform today's fragile loop into a resilient closed circuit. Keywords: sustainable supply chain, wood biomass, circular economy, reverse logistics, focus group interview 1. INTRODUCTION Wood biomass, which includes forestry by-products, sawmill residues and endof-life wood products, is crucial for the transition to renewable materials (De Meyer et al., 2024; Malico & Gonçalves, 2024; Kawa & Dujak, 2025). The efficient utilisation of wood waste is strongly aligned with the principles of the circular Sustainable Wood Biomass Supply Chain in a Circular Economy: Insights from Empirical Research Arkadiusz Kawa 312 economy, which aims to keep resources in use for as long as possible and reduce reliance on virgin timber (Neykov et al., 2020; Psilovikos, 2023). In a circular framework, materials such as waste wood ideally undergo multiple uses (e.g. reuse and recycling) before final energy recovery. Cascading wood biomass in this way not only conserves resources but can also improve overall sustainability by replacing fossil-based products and fuels (for example, using wood waste to make panels or generate bioenergy) (Suominen et al. 2017; Nevare et al., 2022). Previous studies have emphasised that maximising the material use of wood residues for new products before burning them for energy leads to better environmental outcomes (Kuzman et al., 2024; Mehr et al., 2018). However, achieving this in practice requires effective supply chain processes and coordination among various stakeholders. In recent years, the wood sector has come under increasing pressure to adopt the principles of the circular economy and improve waste recovery. Policies in the European Union and elsewhere are increasingly promoting the use of renewable, biobased materials and the recycling of post-consumer wood, such as recovered construction timber, used pallets and furniture, as part of strategies to mitigate climate change and increase resource efficiency (Heräjärvi et al., 2020). Studies estimate that tens of millions of cubic metres of waste wood are generated in Europe each year, with an increasing proportion being diverted from landfill into recycling and bioenergy (IEA Bioenergy, 2014). Nevertheless, significant challenges remain in expanding the reuse of wood waste, including the contamination of waste streams, logistics costs and market limitations, which prevent the full closure of the loop. It is notable that, while the technical and policy aspects of biomass utilisation are well studied, comparatively little research has been conducted from the perspective of industry practitioners who manage the reverse supply chain of wood biomass (Thomchick & Ruamsook, 2013; Helal et al., 2023). Understanding the practical barriers and opportunities for a sustainable supply chain can be achieved by gaining insight into the on-the-ground experiences of those who collect, process, or reuse wood waste. This study addresses the following research questions: 1. Which organisational and logistics factors enable or hinder the near-complete utilisation of wood waste in wood-processing enterprises? 2. How do external cost shocks (e.g. fuel price volatility and labour shortages) affect the economic resilience of the closed-loop wood biomass chain? 3. To what extent do current cascading practices align with the principles of the circular economy, and which parts of the chain need urgent improvement to increase overall circularity? We conducted focus group interviews (FGIs) with industry players across the wood biomass supply chain. The aim was to explore their perceptions regarding sustainability and circular economy initiatives in this context. Eliciting insights directly from sawmill managers, wood product manufacturers, recyclers and others aims to provide a comprehensive overview of the current state and future potential of a sustainable wood biomass supply chain. 25th international scientific conference Business Logistics in Modern Management October 2-3, 2025 - Osijek, Croatia 313 2. LITERATURE REVIEW 2.1 Wood Biomass in Circular Economy The concept of circular economy (CE) calls for closing material loops and extending the life of resources through reuse, recycling, and recovery (Chen, 2020; Smol & Marcinek, 2023). The principles of cradle-to-cradle design translate into cascading utilisation. This involves using biomass residues for the highest-value applications possible and reusing them in multiple cycles before final disposal (Jahan et al., 2022; Odegard et al., 2012). In the case of wood, a classic cascading model might involve using structural timber in construction, recycling it into particleboard and using any remaining wood waste for biofuel (Russell et al., 2023). This approach contrasts with the linear model, in which wood waste is often simply burned or sent to landfill after a single use. Research by Mair & Stern (2017) emphasises the importance of integrating the cascading use of wood into circular economy strategies. They note that this improves resource efficiency by “supporting the multiple use of a resource” and fits within the broader CE framework. Indeed, the European Commission’s bioeconomy strategy promotes the cascading use of biomass, which involves the value-added, hierarchical utilisation of wood and other bio-based materials (Stegmann et al., 2020). In practical terms, this involves prioritizing the recovery of materials, such as creating new wood products or composites from waste, over direct energy production, as recycling materials typically preserves more value. Adopting circular practices for wood biomass can deliver environmental and economic benefits (De Vass et al., 2023). The efficient reuse of wood waste reduces the demand for virgin timber, helping to conserve forests and stored carbon in the process (Sasaki et al., 2016). Using recycled wood instead of new wood or plastics can lower production costs and energy use in manufacturing. Furthermore, using wood residues for bioenergy, such as pellets and briquettes, displaces fossil fuels and contributes to renewable energy targets and lower net greenhouse gas emissions, provided the wood is sourced sustainably (Zhao et al, 2024). Opportunities for reusing wood biomass residues are strongly in line with sustainability and CE goals, as noted by Keefe et al. (2014) and others. 2.2 Reverse Supply Chains and Known Challenges A reverse supply chain for wood biomass involves collecting wood waste and transporting it upstream for recycling or energy recovery. In a closed-loop supply chain, the wood waste becomes the “feedstock” for new value streams, such as woodbased panels or biofuels. Ideally, this would integrate with the forward supply chains of these products (Kawa, 2023). Previous studies of biomass logistics (e.g. Keefe et al., 2014) have highlighted the specific challenges of managing these reverse flows. Contamination and heterogeneity of waste wood are major issues: post-consumer wood may be mixed with other debris or treated with chemicals, such as paints and glues, which complicates the recycling process (Cesprini et al., 2020). Wood waste often needs to be sorted and sometimes cleaned in order to meet the quality Sustainable Wood Biomass Supply Chain in a Circular Economy: Insights from Empirical Research Arkadiusz Kawa 314 specifications required for reuse. This sorting process incurs labour and equipment costs. Another challenge lies in the transport and storage of bulky biomass (Rentizelas et al., 2009). Wood residues can be voluminous yet low in density and value, resulting in high transport costs per unit. Studies have shown that transporting wood waste over long distances can quickly become uneconomical unless optimised, due to mounting fuel costs and emissions (Mobini et al., 2013). Storage of wood biomass requires space and proper conditions; if exposed to rain or moisture, wood waste can degrade, rot or lose its energy value (Alakoski et al., 2016). Maintaining a low moisture content is essential for applications such as pellet production and combustion efficiency, so open-air storage poses risks. Additionally, seasonal and weather factors can affect operations (for example, wet conditions can hinder collection and increase the need for drying). From a supply chain management perspective, coordinating the multi-actor network for wood waste is challenging. This chain may involve construction and demolition companies, waste management firms, recycling plants, panel manufacturers, bioenergy producers, municipalities and logistics service providers. Effective collaboration and information sharing between these entities is necessary to match wood waste sources with the most suitable end users and ensure a timely flow. However, the literature suggests that communication gaps and siloed operations are common (Kawa, 2024). For example, a sawmill might not be aware of a small manufacturer who could reuse its offcuts, resulting in the offcuts being burned due to a lack of alternative outlets. A lack of market information and established trading mechanisms for certain types of wood waste can therefore hinder circularity (Kogler & Rauch, 2018). Whether wood waste is recovered or not is often determined by economics. Even when recycling technologies exist, the process must be cost-effective (Kopsidas & Giakoumatos, 2021). High handling and transport costs can make the recovery of lowvalue wood waste uneconomical (Agyemang et al., 2024). For example, if the nearest particleboard plant is a long way away, a furniture factory may decide that it is cheaper to incinerate its scrap wood on-site for heat than to ship it for recycling. Policies and incentives can have a significant impact on these economics. In some regions, regulatory frameworks for wood waste are underdeveloped or inconsistent, creating uncertainty. Often, policy can lag behind practice in the bioeconomy sector, leaving companies unclear on whether certain wood waste is classified as „by-products” or “waste”, which is subject to stricter handling rules. Nevertheless, there are signs of improvement. Digital platforms and Industry 4.0 technologies have been proposed as a means of connecting suppliers and buyers of biomass residues more effectively (Krstić et al., 2022), which could enhance the efficiency of wood waste exchanges. Policy initiatives, especially in the EU, are increasingly incentivising the use of renewable energy and recycling. Examples include landfill diversion targets for recyclable materials, carbon pricing and subsidies for biomass energy. Some countries have introduced differentiated waste taxes or subsidies to encourage wood waste recycling. However, not all policies align with circular economy goals. 25th international scientific conference Business Logistics in Modern Management October 2-3, 2025 - Osijek, Croatia 315 3. METHODS 3.1 Focus Group Approach This research used focus group interviews (FGIs) to gather insights from professionals involved (Ennis & Chen, 2012) in the various stages of the wood biomass supply chain. FGIs are well-suited to exploratory research into perceptions and experiences as they enable participants to engage in discussion, prompt each other’s memories and develop shared ideas. Three FGIs sessions were conducted in Poland, each lasting 1.5-2 hours. A total of 18 participants (six per session) took part. The research team moderated the focus groups using a semi-structured guide to ensure that key topics were covered while allowing free-flowing discussion. 3.2 Participant Profile Participants were selected to represent a range of roles in the wood biomass supply chain, capturing the perspectives of those on both the “supply” and “demand” sides of wood residue utilisation. To this end, we used purposive sampling via industry contacts and professional networks to recruit individuals from four broad sectors: • Primary wood production (sawmills), e.g. sawmill managers and supervisors dealing with lumber production and by-products. • Secondary wood processing and manufacturing, e.g. managers from furniture makers, wood component manufacturers, pallet producers, and packaging firms. • Wood recycling and bioenergy, e.g. representatives from companies that collect and process waste wood into new materials (particleboard, fiberboard) or biofuels (pellets, briquettes, charcoal). • Related services and downstream users, e.g. companies that utilise wood waste in landscaping, agriculture (bedding/compost), etc. At the start of each FGI, the participants introduced themselves, providing their first name, job title, company type and region. For example, one participant was a sawmill technologist who oversaw lumber production; another was a production manager at a pallet and packaging firm that handled wood manufacturing and transportation services; and another was a quality control specialist at a company that produced garden architecture and pellets. Other participants included operations managers from wood construction materials companies, logistics specialists and individuals with family-run or local businesses in wood products. This variety of participants ensured that the focus groups captured viewpoints from companies of different sizes and at different points in the reverse supply chain. All participants were based in Poland and the discussions were conducted in Polish. For the purposes of analysis and reporting, the researcher translated the transcripts into English. Participants' identities remain confidential, and quotations are referenced by context rather than personal details. Sustainable Wood Biomass Supply Chain in a Circular Economy: Insights from Empirical Research Arkadiusz Kawa 316 3.3 Procedure and Topics Each group followed a similar structure of interview. First, the moderator introduced the concept of “wood biomass” and led an ice-breaker exercise, asking participants to write down their associations with the term. This elicited their initial perceptions of what constitutes wood biomass residues and their associated connotations. Then, through guided questions and exercises, the discussion moved on. Participants were asked to describe the types of wood waste generated or handled by their companies, as well as any classification or sorting practices in place. They were also required to explain what happens to these wood residues, including whether they are reused internally, sold or given to other firms, recycled into new products, used as fuel or disposed of. They were also encouraged to map out the actors involved in taking or supplying wood waste, creating a picture of the reverse supply chain network. The challenges involved in collecting, sorting, cleaning, transporting and storing wood biomass were also discussed. Participants were asked to identify any costly or logistically challenging steps, as well as any strategies they use to mitigate these issues. The level of collaboration between participants and other entities in the chain was explored. A brainstorming session was conducted to identify problems, challenges, opportunities and potential solutions related to wood biomass supply chains. Participants listed issues as well as “what could be done” and emerging positive trends (new markets, technologies and policies). The environmental aspect of wood waste utilisation was viewed by the participants in a specific way, which was either explicitly or implicitly asked about. Concerns about sustainability were expressed (see more in: Kawa & Pierański, 2023). The focus group interviews were audio-recorded and transcribed verbatim (with minor anonymisation). The moderator ensured that everyone had an opportunity to contribute and that all topic areas were covered. They also allowed participants to pursue interesting tangents or debates, as these often-revealed deeper insights. 3.4 Analysis We employed a thematic analysis approach to examine the FGIs transcripts (Kusimo et al., 2019). After reading the transcripts, we coded segments of text according to the themes that emerged. Through iterative discussion, these were refined into a set of major themes and subthemes that best captured the content of the discussions (Morgan & Nica, 2020). Representative quotations were identified for each theme to highlight participants' voices in their own words. When reporting the results, we included such quotations (translated into English) to illustrate key points. In some cases, we attributed them with a general descriptor (e.g. sawmill manager or participant from the furniture industry) to provide context while maintaining anonymity. It should be noted that the findings of the focus groups are qualitative and not statistically generalizable (Vicsek, 2010; Guest et al., 2017). Nevertheless, the consensus and differences observed across the three groups provide valuable insight into the common challenges and unique perspectives within the wood biomass supply chain in a real-world setting. Combining these participant perspectives with existing 25th international scientific conference Business Logistics in Modern Management October 2-3, 2025 - Osijek, Croatia 317 literature provides a richer understanding of how the theory and policy of sustainable supply chains play out in practice. The next section presents the results of this analysis, organised by the main thematic areas that emerged. 4. RESULTS 4.1 Sources of Wood Biomass Participants in the focus groups described a wide range of wood biomass residues generated or encountered by their operations. These included sawmill byproducts, such as sawdust, wood shavings, slabs, and off-cut pieces from lumber production, as well as woodworking scraps, such as trimmings and rejected pieces from furniture or pallet manufacturing. Several participants also deal with postconsumer wood, such as old pallets, used wooden packaging, and construction demolition wood, like discarded roof beams and planks. Some even collect old household furniture and window frames. One sawmill manager noted that they occasionally accept old roof trusses containing nails and showing signs of rot from demolition projects. Although such heavily contaminated wood cannot be reused structurally, it still enters the waste stream for potential downcycling (for example, after the metal has been removed, the wood can be chipped for use as fuel). Participants also mentioned urban green waste, such as tree branches and brush from city park maintenance, and agricultural biomass, such as straw and chaff, as related sources. 4.2 Current Uses of Wood Biomass A striking finding is that none of the participating firms simply discard their wood waste; almost all of them have found a productive use for it, demonstrating that circular practices are already in place to some extent. In many cases, wood residues are sold or given to other industries as a raw material. Sawmills, for example, commonly sell their sawdust, wood chips and shavings to panel manufacturers or pellet producers. A sawmill representative explained, "We give it a second life... Most of our waste goes into making various types of board. We have buyers who produce fibreboard, composite boards, and so on from it”. Another participant from a carpentry factory noted a similar approach: “As a woodworking plant, we don't process the waste ourselves; we hand it over to another company. We have a firm that takes most of our sawdust and shavings, even the oddly shaped offcuts”. This indicates a business-to-business supply chain in which wood waste is a traded commodity. Crucially, such transactions have shifted from informal “giveaways” to monetised exchanges. One participant chuckled, "Giving material away for free died out a long time ago". Now, wood waste yields additional revenue. “We say we give it away, but actually we sell it”, explained a sawmill deputy manager. This economic motivation has even prompted small companies to seek buyers for their wood waste rather than paying for its disposal. Sustainable Wood Biomass Supply Chain in a Circular Economy: Insights from Empirical Research Arkadiusz Kawa 318 Internal reuse was also mentioned. Some manufacturers reuse offcuts in their own production or maintenance processes. For example, a firm that builds wooden houses saves leftover pieces of wood to use as bracing or levelling material on building sites. A pallet producer mentioned that they try to repair and refurbish old pallets wherever possible. “If we can repair and reuse a pallet instead of making a new one, we do”, illustrating a direct reuse loop within the pallet supply chain. Similarly, participants noted that old wooden furniture is often diverted for second-hand use or refurbishment. One participant observed that “old furniture is worth its weight in gold; you don't throw it out, you refurbish it”, provided the pieces are of decent quality. This suggests an existing culture (perhaps driven by thrift as well as sustainability) of extending the life of wooden products through repair and upcycling. All groups acknowledged that wood biomass waste is primarily used as fuel, typically in the form of pellets or briquettes, or by burning wood chips directly. Biomass is primarily used as an energy source' was a common refrain. Many participants' companies either produce biofuel (for example, one company produces wood pellets alongside garden products) or supply their waste to energy users. If not suitable for other uses, sawdust and shavings are often destined for combustion: “Shavings go to OSB boards and sawdust is mostly burned in the drying kiln”, explained one manager, describing the sorting process at their sawmill. Several sawmills use wood waste on-site to fuel their lumber drying kilns or heating systems. Others send it to biomass power plants or pellet factories. Participants believe that this use of energy will increase in the near future, driven by high coal and gas prices and pressure to move towards renewables. "With the current energy crisis (limited coal and gas) biomass will increase its share as a way to solve the problem... EU lowemission rules are pushing us away from coal". Indeed, a few noted a surge in demand for firewood and pellets. “The demand for pellets is about to grow enormously” due to price inflation of fossil fuels. Focus group members shared a variety of innovative or niche ways in which wood biomass residues are being or could be utilised beyond mainstream uses. Some of these examples are given below. Participants mentioned seeing new biodegradable tableware made from wood waste. One participant said they had come across disposable containers made from ground wood, which are pressed and dried to make trays, cups and even soup bowls. Others added that wooden cutlery was becoming more common. These products replace single-use plastics and are an example of the upcycling of wood residues into valuable items. A participant in the sawmill industry described a specific instance in which certain types of wood (such as fruit tree wood from old orchards) were sold at a premium for use in the food industry. "There are firms that buy so-called smoking chips for smoking meats. Not all types of wood qualify, but if we come across applewood or cherry wood, for example, the chips fetch a higher price... rather than selling them cheaply for use in making pellets or particleboard”. This demonstrates how specific residual wood streams can find high-value markets (in this case, imparting flavour to smoked foods). Another niche mentioned was decorative garden wood chips. “They impregnate and dye them, then use them in gardens,” one participant noted, referring to the 25th international scientific conference Business Logistics in Modern Management October 2-3, 2025 - Osijek, Croatia 319 coloured wood mulch sold for landscaping purposes. These are often made from scrap wood that is chipped and coloured which is another example of adding value. Interestingly, one of the participants mentioned that “biomass is used to insulate houses instead of styrofoam or wool. It looks like compressed OSB made of sawdust that has been treated so that it doesn't conduct heat”. This refers to wood fibre insulation boards, an emerging green building material. Wood waste is also used in wood-plastic composites, resins and biopolymers. Although these were not explicitly mentioned in our groups, they are part of the expanding landscape of wood reuse. Overall, participants demonstrated a keen awareness of the “many lives” of wood. As one participant put it, “Every piece of wood waste can be processed in different ways... one piece of wood can be used many times”. They collectively painted a picture of a supply chain in which wood offcuts, shavings and even discarded wooden products rarely end up as “waste” but instead circulate to become the raw material for someone else’s product or process. This naturally leads to a discussion about how this circulation is managed and the difficulties encountered, which will be addressed by the next themes. 4.3 Logistics and Operational Challenges in Wood Biomass Recovery Although wood biomass is generally reused positively, participants identified significant logistics and operational barriers that complicate the reverse supply chain. These challenges can determine whether wood residues can be recovered efficiently or whether potential value is lost. There was a unanimous concern about the need to sort and clean wood waste in order to make it usable. Wood residues are not homogeneous; they vary in size, type and moisture content, and may be mixed with non-wood materials. “The biggest problem is maintaining the cleanliness of the biomass because waste is often mixed. You then have to separate it into fractions depending on demand: larger or smaller components,” one participant summarised. For instance, wood chunks, sawdust and bark may be mixed in waste bins, and nails, plastic pieces and other impurities may be present in construction wood. This necessitates additional processing steps, such as screening, metal removal using magnets, and manual picking. One sawmill technologist mentioned that, of the demolition wood they receive, “there is a lot of metal (nails, hooks), some of which is rotten and not suitable for remilling for use in construction. We can’t avoid sorting that out”. Others agreed that painted or treated wood poses a problem as it generally cannot be mixed into products such as pellets or boards due to quality and environmental regulations (e.g. the chlorine content in paints). However, separating painted wood from clean wood waste is labour-intensive. A recycler in the group noted that municipal bulky waste collections often contain “old furniture, window frames and even tyres, not all of which are made of wood”, and that they must separate the wood for processing. The focus group interviews emphasised the importance of effective segregation at source. Some companies have introduced internal sorting systems with different bins for different types and sizes of wood. In one participant's pellet production facility, for example, sawdust is segregated by wood species due to different burning characteristics. “In pellet production, calorific value is calculated separately for Sustainable Wood Biomass Supply Chain in a Circular Economy: Insights from Empirical Research Arkadiusz Kawa 326 If companies start to view themselves as part of a larger circular system rather than as isolated entities, they may be more likely to proactively seek collaborations and innovations. For instance, a furniture company could design its products to be more easily recycled at the end of their life (a concept known as “design for circularity”), or a sawmill could invest in producing pellets to utilise one more loop of residue. Our findings suggest that peer learning could accelerate this process. Many participants learned new ideas within the focus group itself (for example, one person might not have been aware of the niche market for smoking chips until another person mentioned it). Setting up forums, perhaps through industry associations or sustainability clusters, where companies can share best practices, such as the pellet producer’s sorting system or the orchard wood experience, could encourage the diffusion of innovation. Participants' strong interest in “not cutting more trees than necessary” aligns with the global sustainable development goal of conserving terrestrial ecosystems. If all sawmills and wood factories operated like those in our study, striving to reuse their by-products, this would reduce pressure on forests and landfills while providing economic opportunities in the recycling sector. If done right, there is a clear win-win: companies save money or earn new revenue, and society gains through waste reduction and forest conservation. However, the potential for over-exploitation must be considered if wood bioenergy demand were to skyrocket (as participants predict due to issues with fossil fuels). This could occur if wood were to be burned inefficiently or unsustainably. This again underscores the importance of the controlled, cascading flows that the circular approach requires. 6. CONCLUSIONS 6.1 Implications This study examined the sustainable wood biomass supply chain from the perspective of industry participants, revealing a landscape where the principles of the circular economy are becoming more prevalent, but are also accompanied by tangible challenges. Focus group interviews with professionals yielded several key conclusions and implications. Wood biomass supply chains already demonstrate high levels of material recovery. In the focus groups, all participants reported that they reuse or sell their wood by-products rather than sending them to landfill. Common practices include converting sawdust and shavings into pellets, briquettes or composite wood products; repurposing offcuts in manufacturing or secondary markets; and refurbishing used wood items. This indicates that the industry inherently values resource efficiency, which aligns with the goals of the circular economy of maximising resource life. It also suggests that, even in the absence of strong formal policy drivers, economic and environmental considerations have led companies to find uses for “waste”, effectively treating it as a secondary raw material. In the context of the study, the wood biomass supply chain is clearly evolving from linear to circular. Focus group analysis revealed a microcosm of the circular 25th international scientific conference Business Logistics in Modern Management October 2-3, 2025 - Osijek, Croatia 327 economy in action, where waste is not considered waste but a raw material, and crossindustry linkages form the basis of resource loops. However, a sustainable, closedloop supply chain requires concerted efforts from multiple fronts. Industry players must continue to innovate and collaborate, potentially adopting new business models that integrate forward and reverse logistics. Meanwhile, policymakers should refine regulations to remove barriers and actively encourage recycling and reuse through incentives and infrastructure. Researchers and technology providers must develop solutions for the better sorting, processing and tracking of wood materials. If these efforts are aligned, the sector can achieve near-total utilisation of wood biomass, providing an example of a successful circular economy model. This study highlights the importance of stakeholder perspectives when it comes to identifying practical steps towards sustainability. By interviewing individuals who handle wood biomass daily, we obtained practical suggestions, ranging from straightforward modifications such as labelling bins for softwood versus hardwood sawdust to more substantial proposals like tax reforms for recycled products. Implementing these ideas can significantly enhance the performance of the circular economy. 6.2 Limitations and Future Work It should be noted that this study focused on a specific geographical and economic context. Caution should be exercised when generalising, as other regions may have different levels of market development for wood waste or different regulatory landscapes. However, many of the findings are likely to be relevant in regions with similar industrial structures. Further research could expand to include the perspectives of customers (e.g. energy plants or panel manufacturers), who were indirectly represented here, but not in large numbers. Their input would complement the supply-side perspective by highlighting requirements and constraints on the demand side (e.g. quality specifications for waste wood and required volumes). Additionally, a quantitative follow-up study could measure some of these extents (e.g. what percentage of waste is sold versus used internally versus disposed of) to validate the qualitative findings. Future research could build on this by exploring pilot projects that address the identified challenges, such as a regional wood waste exchange platform, and studying their outcomes. Continual feedback between practitioners, researchers and policymakers will be essential as we collectively push the boundaries of what can be achieved by a sustainable wood biomass supply chain, moving ever closer to a truly circular economy for wood. Moreover, future research could benefit from providing quantitative examples to demonstrate the economic viability of reusing wood waste. For example, it would be useful to estimate reuse multipliers (i.e. how many times pallets or boards can be reused) and identify break-even points between costs (e.g. labour, diesel and equipment) and value (e.g. price per tonne or cubic metre). This would provide practical benchmarks. Such an analysis could help to determine whether the revenues generated from selling processed waste wood justify the associated operational costs. Sustainable Wood Biomass Supply Chain in a Circular Economy: Insights from Empirical Research Arkadiusz Kawa 328 Finally, market transparency remains an underexplored area. Empirical data on mismatches between supply and demand, such as cases where wood waste is transported over long distances despite closer buyers being available, could reveal optimisation opportunities. 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