Russia may suspend log exports from 2022
President Putin wants the government to implement “hard-hitting decriminalisation” of the national wood industry. According to his proposal, Russia may fully forbid exports of certain types of wood by January 2022 and implement a programme aimed to encourage domestic processing.
Softwood log exports from Russia, which have been in steady decline for the past 15 years, may reach zero in 2022 if President Putin’s new log export ban is implemented, says Woodbusiness.ca. The Russian president recently urged the government to strengthen control over the exportation of round timber and low-value forest products as well as clamp down on the illegal trade of logs. According to Putin, it is necessary to introduce a “complete ban on shipments of unprocessed or roughly processed conifer and valuable hardwood out of Russia by 1 January 2022”.
If implemented, the ban will put an end to Russia’s long-lasting role as one of the world’s largest exporters of softwood logs. The country has exported large volumes of raw wood for decades working mostly with Asian and European manufacturers of forest products. In 2006, Russia’s softwood log export volumes reached record 37 million cubic metres. However, shipments fell sharply when log export tariffs were implemented in 2008. As a result, softwood log exports amounted to only 8,5 million cubic metres in 2019. The downward trend has continued this year: the Wood Resource Quarterly market report expects the exports to total around six million cubic metres. As for Russian hardwood log exports, they are also likely to fall in the next two years if higher-value logs such as oak and ash are banned from exporting.
In the first half of 2020, about 10% of Russian shipments were supplied to Finland. The latter exports lower-value hardwood logs, which may be excluded from the future export ban. However, the majority of shipments go to China. For the past five years, the People’s Republic has annually imported about 10-12 million cubic metres of softwood and hardwood logs from Russia. The log export ban is meant to impact the future deliveries of both wood raw material and processed products to China, which is expected to continue increasing consumption of forest products.
The Kremlin also wants to implement a government programme of subsidised loans to encourage domestic processing of Russian timber. The project is aimed to support investing in wood processing facilities, primarily in Siberia and Russia’s Far East, which target growing Asian wood markets. Preferential loans will be intended for facilities producing lumber and panels as well as pellet manufacturers.