Two reports commissioned by the Wood Panel Industries Federation have identified 8,700 UK jobs under threat, many of them in Scotland, due to the proliferation of biomass plants.
Biomass plants burn wood to produce electricity and heat and there are predictions that the number could rocket in the next few decades due to the demand for renewable energy.
WPIF, which represents industries that use wood to make panels for furniture, flooring and roofing, said they are being priced out of the market due to government subsidies for biomass.
They claim the wood they use to create their chipboard and wood panels - such as MDF - has gone up in price by 30 per cent over the past four years.
Three of the UK's seven wood panel plants are located in Scotland - Norbord employs 988 people in three plants at Cowie in Stirlingshire, Morayhill near Inverness and Devon, and Egger employs another 120 at a facility in Barony, near Auchinleck, Ayrshire.
And the study, "The Wood Panel Industry in the UK", by Europe Economics, warned that as well as direct staff, thousands of people who work in related industries could suffer.
It is the latest criticism of the use of biomass for large-scale electricity plants in the UK. A planned Forth Ports biomass plant in Leith, Edinburgh, has attracted widespread criticism.
Environmental groups claim there is not enough wood to supply the proposed plants, which research has predicted across the UK would use an estimated 27 million tonnes of biomass each year by 2025 - more than the entire amount currently in world trade.
WPIF has launched a campaign, "Make Wood Work" to fight against what they claim is "severe market distortion" from the government's system of subsidies, known as the Renewables Obligation. Alastair Kerr, director general of WPIF, said: "Our research proves categorically that the government's renewable energy policies - specifically support for biomass - are directly damaging the competitiveness of the wood panel industry in the UK, which is wholly reliant on domestically-sourced wood."
CarbonRiver, in further research for WPIF, found that burning wood in biomass plants is the most carbon-intensive use of the resource.
It calculated that if the wood currently used for wood panelling was instead burned in biomass plants it would increase CO2 emissions by 6 million tonnes - 1 per cent of the UK's total each year.
Steve Roebuck, director of environmental affairs at Norbord, said the government should focus on a more "responsible" use of wood and that they were not asking for "special treatment" but just a "level playing field".
The federation wants the government to scrap subsidies for wood as a fuel and to only allow the use of wood for the energy sector when it cannot be used for any other purposes.
However, a spokeswoman for the Department of Energy and Climate Change said: "It is possible for both the wood panel industry and the bioenergy sector, as well as other wood users, to coexist.
"This can be achieved in three ways. By increasing the supply of woody biomass so that increased demand for wood in the energy sector generation does not impact other industries, better management of waste wood supplies and increasing the use of non-wood sources of biomass such as energy crops and waste which currently goes to landfill."