Russian forestry key results of 2018 and tasks for 2019

Federal Forestry Agency (Rosleskhoz) held the annual nationwide meeting on Russian forestry on March 27, 2019.

According to Rosleskhoz, forest use revenues of the Russian budget in 2018 amounted to 46.0 billion rubles, which is +38% YoY (or 12.6 billion rubles). An important component of the growth in profitability from the use of forests was the increase in prices of standing timber in 2018: +41% which equals 98.9 rub/m3. In 2018, the forestry of Russia became breakeven: for the first time since the adoption of the Forest Code in 2006, forest management revenues were equal to forest maintenance costs.

Furthermore, Rosleskhoz will continue its work on improving the mechanism of rate calculation in 2019 as well. Forest management key task is raising federal budget revenues. The head of Rosleskhoz reported that in European countries, earning capacity per 1 hectare ranges from 100 to 300 euro, while the Russian federal budget revenues from the use of forests do not exceed 33 rubles per 1 hectare of forest fund.

In 2018, the volume of timber harvesting increased by 12.3% to 238.6 million m3 – this is the highest level in modern Russia. At the same time, the area of leased forest land has not increased (over 242 million hectares are leased for long-term forest use). Rosleskhoz attributes it only to the fact that the forest business “is coming out of the shadow” after a series of measures aimed against illegal harvesting and turnover of timber.

Rosleskhoz is trying to create the necessary conditions for the stable work of conscientious forest users. Federal Law No. FZ-218 of July 23, 2016, defines the mechanisms for the prolongation of lease agreements. But the law does not work yet. During the implementation of the mechanism of prolongation of forest area lease agreements for a new term without bidding (starting from October 1, 2015) with forest users who duly fulfill their contractual obligations (forest management measures, timely payment of rent, etc.), authorized bodies of 49 Russian regions have received 4477 applications. For 1409 of them (31%), the right of prolongation for a new term has been denied.

The main reasons for denials are excessive formal requirements for the prolongation of lease agreements (deadlines for submission of applications, compliance with forest management regulations, violation of laws). Rosleskhoz reported that reforestation works in 2018 were performed on the area of 902,000 hectares (compared to planned 907,000 hectares). But artificial reforestation measures were carried out on the area of 188,000 hectares. In the framework of the Forest Conservation federal project (under the May Decrees), a set of measures will be implemented to increase the total reforestation area from 935,000 hectares in 2018 to 1.5 million hectares in 2024. The project budget for the entire period of its implementation will be over 151 billion rubles. The main goal of the project is to ensure one hundred percent balance of the retired and reproduced forests.

Ivan Valentik, Head of Rosleskhoz, listed the key legislative changes of 2018:
— Decree of the President of the Russian Federation No. 204 dated May 7, 2018, was signed, which recognized the need for the conservation and reproduction of forests on all areas as well as of harvested and dead forest stands. In the framework of the implementation of the provisions of the Decree, the law “On Сompensatory Reforestation” came into force. Ecology
national project aims to ensure a balance of forest retirement and reproduction in the ratio of 100% by 2024 (technically, the country has already achieved these indicators).

— Federal Law No. 538-FZ “On Protective Forests” was adopted. For the first time ever, requirements allowing to assign forests a certain protection category are defined by law. The law stipulates 5 categories of protective forests. Particular attention is paid to the conservation and state regulation of urban forests. It is necessary to ensure their availability, harmoniously fit them into urban development plans. The use, protection, conservation, and reproduction of forests located outside the forest fund, including on agricultural lands, will be regulated consistently for the first time ever.

— In order to improve the forest fire protection regulation, Federal Law No. 42-FZ came into force in March. The law strengthened the liability of officials of regional authorities for providing false information on fire dangers in forests and forest fires.

— The State Duma was submitted a draft law aimed at increasing the administrative liability of the said persons for concealing or providing misleading information about the
sanitary and forest pathology condition of forests.

At the meeting, S.G. Levchenko, Governor of the Irkutsk region, proposed to make forest users in charge of all forest protection duties, to create a state forest management corporation, to introduce a complete ban on exports of unprocessed wood for 2020, and to set export customs duties on rough sawn timber (timber, half-timber, raw non-planed boards).

As for plans for 2019, the head of Rosleskhoz notes that at the moment, there is an instruction of the Government of the Russian Federation to prepare a road map for the elaboration of a new concept of the Forest Code of the Russian Federation. A new task group is being formed by the Ministry of Natural Resources of Russia.