Belarusian timber trade sector overview in January-August 2018
The timber section of the Belarusian universal commodity exchange concluded deals worth 374 million Euro, up 31% over January-August 2018. The growth came on the back of a considerable increase in round timber supply to the domestic market, as well as the export of sawn timber and wood chip fuel.
As far as the round timber sales, the growth was driven by the decree of the President of Belarus to maximize using of the capacities of domestic woodworking companies. With a view to manufacturing products with a high added value, around 6.1 million cubic meters of raw wood was purchased through the actions for domestic market. The contracts were estimated at 146,4 mln. Euro, up 17% in volume terms and up 28% in money terms.
The export of sawn timber exceeded 141.4 million Euro, up 79% over last year. The major buyers were companies from the European Union. They also were actively purchasing wood chip fuel – 2.1 million cubic meters worth more than 41.8 million Euro. Thus, compared with January-August 2017, the export of wood chip fuel in volume terms tripled, while the export in money terms rose five times.
The domestic demand for paper products has increased considerably pushing sales up to 9.2 mln. Euro (up 19%). The trade in wood services is growing by leaps and bounds. Thus, since the beginning of the year, the purchase of services related to timber harvesting and forestry operations rose by 98% reaching 24.2 million Euro. “Taking into consideration that the trade in forest restoration services is just gaining momentum, we can expect this figure to keep growing,” Roman Yaniv, press-secretary of the Belarusian universal commodity exchange said.
In January-July 2018 mills of the Belarusian timber, woodworking, pulp and paper industry concern “Bellesbumprom” (unites around biggest 50 mills) increased their export by 36.8% to $304.1 million. Bellesbumprom factories export all kinds of their products they produce. In January-July 2018 the mills exported $93.5 million worth of particleboard and MDF (nearly 39% up from January-July 2017), $70.3 million worth of furniture (23.1% up), $47.1 million worth of plywood (82.8 % up), $44.5 million worth of paper and pasteboard (66.7% up). The export of sawn timber, fuel wood, doors, windows, all kinds of wooden products is on the rise.
The growth in production volumes is provided for almost all major types of products. So, the biggest growth in production during January-July 2018 was in plywood production – 82.8% more than in the same period last year. Such dynamics is mainly due to the growth in plywood production at JSC Borisovdrev – by 70.6%. This mill during seven months produced 7.1 thousand cubic meters of plywood (in January-July of 2017 only 4.1 thousand cub.m.). At the same time, five other biggest producers, with an average growth rate of 112-115%, produce more significant volumes: from 16.3 thousand cub.m. in JSC Gomeldrev to 58.1 thousand cub.m. – in CJSC Pinskdrev . The output of MDF increased by 29.7%, paper and cardboard output was 21.9%, furniture – 18.9% and chipboards – 8%.
Belarusian mills do not usually build stocks of panel products, all products are immediately used in the domestic market and exported. Out of the total volume of products produced in January-July, 68.6 % was sold for export (44.2% in January-July 2017). The products of mills enterprises are supplied to the markets of 57 countries.
Bellesbumprom’s enterprises have been gradually increasing export of furniture. This year the export has accounted for more than 66% of its overall output. The share of exports has increased compared to 2017 by 2% (60.3% in 2016, 55.2% in 2015). Russia remains the main sales market of furniture for Belarus. Export to its neighboring country amounted to $34.7 million in H1 2018 which was up 10.4% over the same period a year ago. Shipments to Poland totaled $7.6 million (up by 57.6%), to Kazakhstan about $7 million (up by 2.9%), Germany $4.7 million (almost six times more). In general, the furniture manufacturers delivered their goods to 33 countries. The geography of export has been growing bigger. Among the new markets are the United States, Canada, Spain, Serbia. “Increasing the export of furniture is among the priorities for Bellesbumprom. Furniture is a high added value product.
The furniture production is a processing industry, virtually waste-free and therefore the most efficient. Bellesbumprom’s enterprises have been working hard to diversify the markets and developing new production programs to win over customers in Western Europe. You can gain a foothold in a new market only with the products that are in popular demand there and are competitive in terms of price-quality,” the press service said. Furniture shipments abroad have been steadily increasing. In January-June 2018, supplies to non-CIS countries accounted for 28.7% of total furniture exports (18.7% over the same period in 2017).
A business Forum dedicated to the Belarusian woodworking and furniture industries will take place in Minsk on 13 September. Executives and specialists of Belarusian furniture and woodworking companies, representatives of marketing, consulting, and financial organizations will take part in the forum. Delegations are also expected to arrive from Germany, Austria, Turkey, Croatia, Poland, Kazakhstan, Ukraine, Russia, and Baltic states. The purpose of the forum is to help Belarusian furniture producers and producers of other woodworking products to establish relations in new markets. Belarusian participants will present up-to-date reviews of the forest harvesting industry, woodworking and furniture-making industries of the countries, drawing attention to resources, manufacturing facilities, demand on and structure of the home market, the structure of export and its prospects.
Representatives of German and Austrian business associations will present up-to-date reviews of Western Europe markets of woodworking and furniture products, focusing on trends, the structure of the market, the role of international trade shows, problems and opportunities in export, import, manufacturing cooperation schemes for Belarusian companies, quality standards, European regulations on manufacturing and trade. Apart from that, a business matchmaking session will be arranged, during which participants will be able to exchange views and discuss cooperation options.
The business forum is organized by the Business Union of Entrepreneurs and Employers named after Professor M.S. Kunyavsky, the Association of Furniture and Woodworking Industry Enterprises of Belarus, and the Belarusian timber, woodworking, pulp and paper industry concern Bellesbumprom. The forum will be the key event of the business program of the 25th international trade show Furniture 2018. The trade show is expected to gather over 100 producers of furniture, furniture materials, components, as well as architects and industrial designers.
[This article is by the Trade and Economy Group of the Embassy of the Republic of Belarus]