China's state-owned industrial forests, mostly in its Northeast region, are an important source of timber and environmental services in the country. In this paper, we use a break-even price approach to project the long-term timber supply from the state-owned forests in Heilongjiang, the largest timber producing province in the region. Our results show that, at given prices and costs, future sustainable timber production could double the 2006 level and reach the historical high in a full rotation of 40–60 years. This indicates that the region is positioned towards a forest recovery after many decades of over-harvest and decline in mature forest stocks.