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Russia's plywood production declines 16% in first six months of 2023
[Jul 28, 2023]

In the first six months of 2023, Russia's plywood production declined by 16.4%, reaching 1.59 million m3, according to Rosstat. In 2021, Russia produced a record 4.5 million m3 of plywood, while in 2022 there were only 3.2 million m3. In 2023, production is expected to drop to the level of a decade ago.

The production decrease is attributed to the sanctions imposed following Russia's invasion of Ukraine. In 2021, Russia's plywood exports amounted to 2.96 million m3, valued at $1.94 billion. European sanctions have led Russian manufacturers to lose a significant market, where 1.35 million m3 of plywood was exported in 2021 worth $787 million. Additionally, UK sanctions further isolated Russian companies from a market where 76 thousand m3 of plywood, worth $46 million, were exported in 2021.

Russia lost Most Favored Nation trade status with the United States, leading to a 50% customs duty on its plywood. Compared to 2021, when Russia exported 569 thousand m3 of plywood to the U.S. worth $361 million, only 63 thousand m3 were exported in the first five months of this year.

As a result, Russia has lost access to markets where country previously supplied about 2 million m3 of plywood. Attempts to redirect this volume to other countries have not been successful, despite the increase in supplies. There are simply no other markets on the planet capable of consuming such volumes.

During January to April 2023, plywood exports from Russia to Egypt increased by 7% compared to the same period the previous year, reaching 78 thousand m3. Russian plywood exports to Turkey from January to May skyrocketed sevenfold, reaching 64 thousand m3. Shipments to China in the first half of this year surged by 82% year on year, reaching 81 thousand m3.

Source: Rosstat