Raute Corporation has received orders worth approximately 18 million euros from Red October LLC to Russia. The order includes machines for all main production processes to a new birch plywood and veneer mill, a log handling line, three peeling lines, a veneer drying and grading line, and a plywood lay-up and pressing line and a trimming line. The equipment will be delivered to Red October’s birch plywood and veneer mill located in Perm, Russia. A service agreement for several years as well as extensive digital services are also included in the scope.
The production capacity of the green field mill will be 45,000 m3 of birch plywood and 60,000 m3 of birch veneer to be sold to other plywood and furniture makers. Production in the new mill is planned to start in 2023.
The ordered machinery and equipment will be delivered between August and November 2022. The equipment will be engineered and produced in Raute’s production units in Lahti, Shanghai, and Kajaani, Finland, and also in the company’s partnership network.
Red October group of companies is the largest sawn timber producing factory in the Perm region. It was founded in 1910. In the recent years, the company has developed its business systematically, eg by building a new sawmill in 2013. Now Red October will expand its business in birch plywood and veneer production. The company has concessions to a forest area with license to harvest more than 1 million m3 of timber per year.
Red October’s operations cover the full timber supply chain from forest management, harvesting, transportation, sawmilling and delivery of sawn timber to its clients in more than 30 countries across 3 continents. With the new project in partnership with Raute, the company expects to double its current production capacities at all stages of production, and reach maximum utilisation of forest resources including both coniferous (spruce and pine) and deciduous (birch, aspen) species. Red October is accredited with ISO, FSC and PEFC certificates, and the company’s main mission is development through state-of-the-art technology.
Raute’s strong expertise in the entire plywood production process was the main factor for Red October to select them as the full scope supplier for their project. Raute’s service offering, both through local presence in Russia and through digital channels, was also why Red October selected them.
The present new order has no impact on Raute’s outlook for 2021. Raute’s net sales are expected to grow in 2021 and operating profit to improve from 2020.