(1)Tannins have shown antifungal effects and have been considered a potential natural compound for wood preservation. Extracts produced from softwood bark contain both tannins and non-tannin compounds, which may reduce the effectiveness of tannin used as a wood preservative. The purpose of this research is to study the environmental impact of hot water extraction, identify the hot spots within the tannin cradle-to-gate life cycle and give suggestions to optimize its environmental profile. Different extraction and postextraction scenarios of tannin production are compared using the life-cycle assessment method. Experiments were designed to study the tannin yield under different extraction scenarios; the post-extraction scenario analysis was based on literature review. The results show that the extract drying process is the primary contributor to the environmental impact of tannin production. Both preliminary cold water extraction and ultrafiltration after extraction are beneficial as they have fewer non-tannin compounds in the final products; however, preliminary cold water extraction had a considerably lower environmental performance. Successive extractions using fresh water at each cycle increased the total tannin yield, but increased the environmental burden. Using only evaporation to obtain a desired tannin concentration is not environmentally efficient. This paper provides a quantified environmental analysis for the development of tannin-treated wood products and discusses the different tannin extraction scenarios from an environmental point of view.