Russia’s forest-based industries undergo major restructuring in 2024, with wood panel production increasing due to revived domestic furniture manufacturing, while output of lumber, pulp, and paper remains flat or declines amid weaker construction demand and falling exports. These developments are detailed in a new 122-page industry report set for release on April 25.
The production segment shows mixed performance. Wood-based panels, especially OSB and particleboard, report substantial growth, while volumes of lumber, paper, and pulp remain stable or decrease. The pulp and paper segment sees declines in newsprint output, but gains in coated cartonboard, sanitary paper, and corrugated packaging due to e-commerce, food, and pharmaceutical demand.
Export volumes fall across most product categories compared to 2021. The loss of European markets due to sanctions is partially offset by increased deliveries to China, Turkey, India, and CIS countries. Kazakhstan and Uzbekistan expand their role as consistent buyers of Russian lumber and paper products, but the industry’s heavy dependence on a few destinations remains a vulnerability.
Domestic prices rise for OSB, particleboard, and packaging grades, while white paper and pulp prices decline. Export prices fall overall, reducing foreign currency revenue even when physical volumes increase.
Investment activity stays low. Projects focus on completing existing facilities and modernizing lines, with few large-scale new initiatives. Financing is constrained by a 21% base interest rate and limited access to foreign capital.
Forecasts for 2025–2026 indicate cautious expectations. GDP growth is projected at 1.7% in 2025, below global averages, limiting construction growth and therefore domestic wood demand. The ruble is expected to stay volatile between 95 and 105 per USD, with risks of unprofitability for some exporters if it strengthens further. Labor shortages continue to pressure costs and slow project launches, especially in manufacturing and logistics.
The full findings appear in the 122-page annual report “Russia’s Forest Based Industry in 2024 and Global Markets: The New Reality”, which includes economic conditions, forecasts through 2026, and sector-by-sector analysis. Preorders are open now with a 20% discount until April 20.
