Russian Log, Lumber Exports up Substantially
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The world's largest log exporter, Russia, increased its shipments of logs in the first quarter of this year after having declined for four years, reports the Wood Resource Quarterly (WRQ), Seattle, Wash., USA. Russian exports of softwood lumber have also gone up substantially, especially to China, Uzbekistan, Japan, and Egypt, according to WRQ.
Russia has for many years been, by far, the largest exporter of logs in the world. When the country announced a log export tax of 25% in 2007 and thebintention to increase this tax to 80% in 2009, many forest companies in Asia and Europe decided to reduce their reliance on Russian logs. As a result, total log exports from Russia fell from 51 million cubic meters in 2006 to about 22 million cubic meters in 2009 and 2010.
This downward trend, however, appears to have been broken in 2011. During the first few months, total softwood and hardwood log exports have been up by almost 40% compared with the same period last year, WRQ notes. Much of this increase in shipments has been to China, Finland, and Japan. This recent upward trend can be expected to continue during 2011 and 2012, albeit less dramatically, as Russian log export taxes are reduced.
During discussions between Russian and EU representatives in December last year, it became clear that Russia has been pressured to reduced log export taxes if the country wants to join the World Trade Organization (WTO), WRQ says. It is still not clear, it adds, exactly what the new log export taxes may be and when they will be implemented. Softwood log taxes may fall to somewhere between 5% and 10%, and hardwood log taxes will probably be lower than those for softwood. The lower tax rates are not likely to be instigated until Russia has been recognized as a full member in the WTO, which may not be until early 2012.
Russia has not only increased its exports of logs but also of softwood lumber. From 2008 to 2010, WRQ reports, exports were up 18%, reaching an all-time high of 17.5 million cubic meters last year. So far this year, exports have been more than 50% higher than the same period last year; 2011 may very well be a record-year. China is the largest market for Russian logs, followed by Uzbekistan, Japan, and Egypt.
Shipments to China tripled between 2007 and 2010; during the first quarter this year, exports were 150% higher than the same quarter in 2010. The trade of logs and lumber between Russia and China can be expected to expand in the coming years because of the continued increase in demand for wood products in China and the country's relatively close proximity to Russian forests and sawmills, according to WRQ.
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