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Compared with last year, the volume of timber harvested and processed by timber companies in Northwest Russia has decreased by 25%-30% this year.<\/span><\/p>\n These data were corroborated by statistical departments in the Northwest Forestry Development Authority's major regions involved in timber harvesting and processing. Compared with January-May 2022, the production of unprocessed wood in the Leningrad region in January-May decreased by 29.5% (1.1 million cubic meters), sawn timber decreased by 18% (219.7 thousand cubic meters), while wood pellets were down 76.6% (14,000 tonnes).<\/p>\n From the perspective of assets, the turnover of enterprises engaged in wood processing and production of wood products (except furniture) decreased by 30.8%. The volume of wood processing and production of wood products in the Vologda Oblast fell by 36.7%. The volume of wood processed and produced by Karelian producers from January to May decreased by 18.8% compared to the same period last year.<\/p>\n Logging and wood processing fell by 30-50% last year in the northwestern region of Russia amid European sanctions and is still unable to recover as most local producers have previously focused on exports to Europe.<\/p>\n Since the timber industry market in the Northwest Federal District was previously mainly supplied to Europe, the goods in the warehouses in this region were immediately shipped to the West. Therefore no additional sales channels were established.<\/p>\n For certain types of products from the Northwest Forestry Development Region of Russia, the market has almost completely disappeared. Wood pellets has almost lost its market. Now, the Leningrad Oblast, Karelia and Arkhangelsk have almost nowhere to sell pellets, and it is not profitable to ship them as far east as Japan and South Korea, so almost no pellets are produced in these regions.<\/p>\n Timber products from the Northwest Federal District have started exporting to new countries - the Middle East and North Africa. The South could be a promising direction for timber businesses in the Northwest Federal District. Timber is shipped along the North-South corridor to southern Russia, where there is a shortage of wood, and to Turkey, Iran, as well as India, China and North African countries. As much as 20 to 30 percent of products supplied to the European market are now diverted in this direction.<\/p>\n Producers are also starting to look for other sales routes around Europe. Now, there are several options for exporting timber products from the region to the east: via the northern or western direction. However, supplies to the East are currently not favorable given the cost of breaking ice along the Northern Sea Route and the use of lighter ships. Another option is to transship in St. Petersburg and ship to China via the western route. This is also one of the ways out for the wood processing enterprises of the Leningrad Oblast and the entire Northwest Forestry Development Bureau to retain their logistics routes.<\/p>\n However, we can foresee further reductions in logging and wood processing by the end of the year. The 30% figure is not the final decline, although the wood processing market has partly stabilized. One of the reasons is the expected decline in domestic market demand for various products of the wood industry complex.<\/p>","protected":false},"excerpt":{"rendered":" Compared with last year, the volume of timber harvested and processed by timber companies in Northwest Russia has decreased by 25%-30% this year. These data were corroborated by statistical departments in the Northwest Forestry Development Authority’s major regions involved in … Continue reading