Abstract: Base on the time serial data of forestry industry in both Yunnan Province and in whole China, the structure of forestry industry and the problems related to forestry industry competition in Yunnan Province were analyzed by means of dynamic ShiftShare Analysis method. The results showed that the overall competition capacity of the forestry industry in Yunnan Province was higher, but the industrial structure was irrational, i.e., the first industry competitiveness level was high, while the competitiveness level of the second and the tertiary industries was low among the first layer of industries. Among the second layer forestry industries in Yunnan Province, the structure of the first industry and the second forestry relevant industry was rational, but the forestry industry structure in the tertiary forestry industry was not rational, which resulted in the low competitiveness of the second and the tertiary industries in Yunnan Provicne.