The Lumber Mill is a standard tile improvement in Civilization VI. It can only be built on tiles with Woods. In Civilization VI: Gathering Storm, it is unlocked with Construction and can also be built on tiles with Rainforests, after researching Mercantilism.
Any Woods feature along a river (especially if on Hills) can become invaluable for industry due to the high production boost from Lumber Mill. Avoid cutting down Woods in the early game, because as soon as you hit the Medieval Era they will provide you with this great boost to Production. What's more, later you will be able to claim diplomatic bonuses for not having cut these Woods, besides gaining Appeal ratings for neighboring tiles!
In Gathering Storm, after the June 2019 update, the Lumber Mill has been redesigned and enhanced considerably! It now unlocks in the Classical Era and has +2 Production from the start (a bonus which replaces the River Adjacency bonus, now gone). This makes it a vital production booster for empires starting in level terrain without Hills, where Woods are the only useful feature. Furthermore, Lumber Mills can now be built on Rainforest tiles as well, come the Renaissance Era! All this makes it a viable alternative to the Mine as a general Production booster for areas where Woods and Rainforests dominate. And of course, it has the advantage of not ruining nature, as Mines do (to build a Mine you have to remove the feature on the Hill, unless the Mine is built on some resource; not so with the Lumber Mill). And in Gathering Storm this now has more implications that just the diminished Appeal.
Civilopedia entry Edit
For centuries the purpose of a lumber mill has not changed: logs go in one end, and cut beams, boards, posts, and shingles come out the other. The earliest known sawmill that can be reliably dated is a Roman water-powered mill uncovered at Hierapolis dating to the 3rd Century AD. Small, water-powered mills were common throughout Europe and the Middle East where trees were plentiful, and the designs later went with European colonists so they could start chopping down the virgin forests everywhere else as well. The Industrial Revolution sped the whole process, as steam railroads could transport the logs to steam lumber mills, and then haul the “finished” (in more ways than one) wood products to market in the booming cities. In time, even the byproducts of the trimming and cutting were used – for paper, fuel, and packing.