The Chilean forest industry is often described as a “green” or even “sustainable” industry, but in many ways it does not live up to this. Many negative impacts relate to the immense land grabs by the forestry industry, which have led to the massive replacement of near-natural forests in the coastal mountains and the displacement of other land uses. In the context of a discourse on alleged “eco-industries,” the relationship between industry and spatial development needs to be considered. These considerations expand the discourse around eco-industrial development, which usually focuses on the immediate processes of production within and between companies, but not on their relationship to space. In order to disentangle the differential effects of economic policies and world market signals, relationships between political-economic factors and the spatial effects on land use have to be elaborated. Land-use change drivers are identified and forest losses are attributed to land appropriation by plantations. A prospective analysis is coupled with a retrospective analysis to understand land-use change processes in Chile’s Coastal Range. In addition, this analysis aims to disentangle political-economic incentives to spatial developments in Chile. As a result, it is shown that deforestation can largely be attributed to commercial plantation establishment. Moreover, the subsequent results suggest that important incentives in the establishment of these plantations are not only Chilean subsidies but also influences from the development of world forestry markets.