Russia’s wood pellet production up by 34.1%, growth to accelerate in future years

Favourable export markets and the economy’s GDP growth of 1.5 per cent in 2017 drove up demand for wood-based products in Russia, according to a new report, Russian Forest Based Industries in 2017.

Woodworking machinery imports also saw an increase of 60.7 per cent, after a 15.6 per cent decline in 2016, suggesting that wood processing companies may have adapted to the current exchange rate of the national currency. Investments in fixed assets in the production of paper and paper products increased by 33.3 per cent while wood processing (excluding furniture production) achieved gains of 5.5 per cent.

Russian wood-based production in 2017

As Russia moves from exporting logs to more value-added products, 2017 saw log exports falling 1.6 per cent while lumber rose 10.1 per cent. Russia’s largest export market is China: In 2017, China accounted for 66 per cent of all Russian logs exported; lumber, 55 per cent; pulp, 58 per cent.

The oversupply of MDF drove exports—up 36.1 per cent compared to 2016 and almost double the amount in 2014.

Pellet production in Russia grew 34.1 per cent and will accelerate as domestic and foreign companies plan new investment.

The state’s focus on developing the forestry sector and wooden home construction through a number of incentives is likely to see domestic demand for lumber rising in the next three to five years.

As e-commerce thrives, the demand for cardboard packaging has gone down in Russia. However Chinese manufacturers are the winners at the end of the day as Russian e-shoppers buy 90 per cent of their goods from China.

 

Source: Lesprom Network