In 2017, Russia sharply increased woodworking machine imports (+60.7%) after a decline of 15.6% in 2016. This may indicate that companies of Russian forest-based industries have adapted to the current exchange rate of the national currency, according to the analytical report "Russian forest-based industries in 2017", prepared by Lesprom Network's Research Department.
Investments in fixed assets in the production of pulp and paper products increased by 33.3%, and investments in wood processing (excluding furniture production) up 5.5%.
In 2017, favorable situation on foreign markets formed a steady growing demand for the main products of the Russian forest-based industries. At the same time, the turn of the national economy from a recession to growth (GDP grew by 1.5%) led to a revival of demand for products for domestic market. These trends are expected to continue in 2018.
China remains the main consumer of products of the Russian forest-based industries. In 2017, China’s share in the Russian export of logs was 66%, in lumber exports - 55%, in pulp exports - 58%. According to the World Bank, the growth of China's economy amounted to 6.8% in 2017, and it is expected to grow 6.4% in 2018. According to the analytical report, the process of structural changes in exports (from raw materials to wood processing products) continues: Russia’s log exports decreased, but lumber exports increased by 10.1% in 2017. Overproduction in the Russian MDF market led to an increase in MDF exports by 36.1% compared to 2016, and MDF exports grew almost 2 times compared to 2014.
Growth (+34.1%) of wood pellets production in Russia in the coming years will continue at a rapid pace, due to Russian and foreign companies are planning to launch a new production facilities in the country, according to the analytical report.
Increased attention of the state to the development of the forest-based industries and the beginning of a number of incentive measures for the development of wooden housing construction can contribute to increased demand for lumber within the country in the next 3-5 years.
Analytical research "Russian forest-based industries in 2017", contains 119 pages, it is annually issued by Lesprom Network's Research Department for 15 years. The report is the only annual comprehensive study of the the Russian forest-based industries. The report contains an analysis of the markets of wood raw materials, lumber, wood panels, pellets, pulp, paper and cardboard, as well as trends in the main export markets for Russian timber products. The report will be available here.