Since the Russian Ministry of Industry and Trade issued a ban on exporting timber to EU countries and the United States at the beginning of the year, the chain reaction of the situation in Russia and Ukraine has made Russian timber trade difficult.
01. Russian timber production declines
Directly affected by the Russian-Ukrainian incident, the exports of forest products from Russia, Belarus and Ukraine "declined sharply". According to the data, in the first quarter of 2022, the amount of wood harvested in Russia has declined since 2019, from 70.7 million cubic meters to 68.9 million cubic meters, a decrease of about 2.4%.
Among them, the Leningrad and Irkutsk regions, which are mainly exported to European countries, became the record holders for the decline in logging volume, with a decline of 34% and 11.5% respectively.
02. Timber exports to China slowed down
However, the situation in Russia and Ukraine is not only about the forest products market. As more countries put restrictions on Russia, timber shipments outside Europe have also stopped, leading to a slowdown in exports of forests and wood products from those countries that continue to trade with Russia.
In April this year, Russia's timber exports to my country fell by 11% year-on-year to 1.04 million cubic meters. The value of exports rose 6 percent to $250 million, according to LespromAnalytics. Average lumber prices rose 18 percent to $239 per cubic metre.
The situation in Russia and Ukraine has had a significant overall impact on the global timber and forest products market. Global prices, availability and supply chains for timber and forest products are likely to change as Russian timber supplies continue to tighten.
03. Various measures to promote Sino-Russian timber trade
Recently, the Russian Consulate General in Harbin announced that the government of Fuyuan, a city on the border between Russia and China, approved the provision of preferential conditions to enterprises engaged in the import of Russian timber, coal and agricultural products. Preferential policies include covering part of transportation costs, support measures to organize the processing of imported raw materials, and tax relief. Without tariff barriers, the trade cost of my country's imports of Russian timber will be reduced.
In addition, according to the Russian Satellite News Agency, Oleg Belozerov, President of the Russian Railways Corporation, said that the Russian Railways plans to add two land border ports between Russia and China. By then, the economic and trade exchanges between my country and Russia will be more convenient and faster.
Overall, my country's timber imports in April were on a downward trend, but prices rose slightly under the influence of multiple factors.
●In the domestic market, when the epidemic prevention and control situation improves, the subsequent suppressed demand for timber is expected to be released in a concentrated manner.
●In the international market, the unstable situation in Russia and Ukraine may bring further uncertainty in terms of trade flows and prices of forest products.
