Sanctions continue to weigh heavily on Segezha Group, with Russia\u2019s largest forest company reporting a net loss of 88 billion rubles (around $1.1 billion) in 2025, four times higher than the 22 billion ruble loss recorded a year earlier. Full-year results showed revenue declining 12% to 89 billion rubles, as weaker sales volumes, lower prices, a stronger ruble against export currencies and rising costs combined to erode performance.<\/p>\n
China remained the group\u2019s dominant outlet, accounting for 77% of lumber sales, but also a major source of pressure. The company cited weak demand and sustained pricing pressure, with lumber volumes falling 9% to 2.1 million cubic metres. Domestic sales were increased at certain processing sites, reaching as much as 69%, in an effort to absorb volumes affected by the slowdown in China.<\/p>\n
Birch plywood sales were broadly stable at 173,000 cubic metres, down 1% year on year, as shipments to China and India declined. Demand softened across key end-use sectors such as flooring, furniture and transport. The company also pointed to tariff restrictions and India\u2019s BIS certification requirements as constraints on exports, while domestic deliveries rose by around 50% to partially offset weaker international demand.<\/p>\n
Financial factors accounted for a significant share of the losses, including 35 billion rubles in interest and other expenses, alongside 36 billion rubles linked to a revised long-term strategy and production reorganisation. These included asset write-downs on suspended projects, reduced capacity at one sawmill and adjustments to sawing volumes and log-quality parameters across its Siberian operations, based on updated cash-flow expectations.<\/p>\n
Industrial packaging volumes declined 12% as demand for construction-related packaging weakened following tighter monetary policy and the end of subsidised mortgage programmes in Russia. While exports to the Eurasian Economic Union and CIS countries increased, they remain well below the levels previously shipped to Europe before sanctions took effect in 2022.<\/p>\n
Segezha said it has adopted an updated medium-term strategy focused on financial stability and cash-flow recovery, including measures aimed at improving operational efficiency and increasing sales volumes. Planed-wood product sales rose 13% in 2025, while capital expenditure was reduced by 37% to 4.6 billion rubles, with future investment expected to remain focused on maintenance.<\/p>\n
The results come as Russia\u2019s forest sector faces mounting pressure, with industry estimates suggesting that up to half of companies could shut down by the end of 2026. Regional authorities in Arkhangelsk have called for support measures including a moratorium on creditor-initiated insolvency proceedings, tax deferrals and a freeze on debt collection for liabilities accumulated before 2026, proposals supported by company representatives.<\/p>\n
Since the loss of the European market following sanctions in 2022, China has become the primary destination for Russian lumber, but demand has weakened amid a prolonged downturn in the country\u2019s property sector. Official data showed Chinese real estate investment fell 11% year on year in early 2026, while sales of newly built housing dropped by around 14%.<\/p>\n
At the same time, Russia\u2019s share of China\u2019s softwood lumber imports has declined, with suppliers such as Canada, Sweden and Finland gaining ground. With 77% of its lumber exports directed to China and limited alternatives at scale, Segezha remains exposed to ongoing volatility in its main export market.<\/p>","protected":false},"excerpt":{"rendered":"","protected":false},"author":1,"featured_media":98493,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"Default","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[5204],"tags":[],"class_list":["post-98492","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-daily-news"],"acf":[],"yoast_head":"\n