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Recently, the Russian Ministry of Industry and Trade pointed out that prices for Russian wood and processed finished products, including construction materials, plywood, etc., may rise.\u00a0Experts believe that sawn timber prices may rise by 5-10%.<\/span><\/p>\n Reason for price increase<\/strong><\/p>\n It is understood that the main reason for the increase in prices of timber and wood products in Russia is the seasonal forestry transportation restrictions.\u00a0Previously, in order to ensure road safety, the Russian Ministry of Industry and Trade announced the suspension of seasonal restrictions on timber transportation on regional, intercity and local important roads in 2023. The specific restrictions will be implemented by each region from March to June.<\/p>\n In this regard, the Russian forestry enterprises asked the Ministry of Industry and Trade to send a request to the federal government to suspend this restriction.<\/p>\n According to Ilya Ovchinnikov, Director of Corporate Development of Kronospan Group, about 4-5% of raw materials and products of wood industry enterprises cannot be put on the market every year due to seasonal transportation restrictions, while during downtime, prices of wood and wood products may increase by 5-10% .<\/p>\n More importantly, the supply chain will be cut off, which will lead to a shortage of raw materials for enterprises.\u00a0This situation will be exacerbated by adding the shortage of transport vehicles that has existed before.<\/p>\n Therefore, in the view of most Russian timber merchants, seasonal transportation restrictions will greatly increase the cost of raw materials for timber processing enterprises, and cause obvious damage to cargo logistics, especially destroy the timber supply chain, and reduce the production efficiency and efficiency of the timber industry.<\/p>\n Not only that, but it will also lead to an increase in the production turnover cost of the enterprise and an increase in the price of finished products.\u00a0Even, some Russian timber companies will not be able to produce enough raw materials in the off-season due to financial difficulties.<\/p>\n Russian wood companies face many difficulties<\/strong><\/p>\n As early as 2022, Europe closed Russia's export channels to it, and the Russian timber industry is in trouble.\u00a0This has brought many negative effects.\u00a0For example, the production of particleboard in Russia in 2022 has dropped by 10% compared with 2021; the annual production of plywood has dropped by 28%.\u00a0At the same time, many European timber companies have also withdrawn from the Russian market.<\/p>\n Even into 2023, Russia's timber harvesting and processing industry is still struggling.\u00a0Including the continuous pressure from ''unfriendly'' countries, the need to readjust the direction of logistics and transportation, and the lack of preparation for some of the transportation infrastructure, etc.\u00a0Therefore, if combined with the implementation of seasonal transport restrictions, it will be even worse for Russian timber traders.<\/p>\n Currently, the Russian Ministry of Industry and Trade is awaiting seasonal adjustments in timber prices due to the start of the construction season and increased demand.\u00a0Although the department believes that the removal of seasonal restrictions on timber transportation will have a positive impact on the work of forestry enterprises and ensure the stable transportation of timber products.\u00a0But whether it will be canceled in the end still needs to be confirmed by the Russian Federation government.<\/p>\n From the end of last summer to the beginning of spring 2023, the price of Russian wood and wood products has maintained a steady decline. The situation has reversed in March-the price of some wood has increased by 500 rubles.\u00a0Therefore, if the seasonal shipping restrictions persist, Russian timber export prices are expected to increase.<\/p>","protected":false},"excerpt":{"rendered":" Recently, the Russian Ministry of Industry and Trade pointed out that prices for Russian wood and processed finished products, including construction materials, plywood, etc., may rise.\u00a0Experts believe that sawn timber prices may rise by 5-10%. Reason for price increase It … Continue reading