Segezha Group is on the rise of log supply chain

At the beginning of 2020, Segezha Group acquired a sawmill asset of Karelian Wood Company, which has leased forest areas (please refer to the issue Russian Wood Resources Report 01-2020). In addition to additional 205,000 m3/y by AAC, Segezha Group obtains 250,000 m3/y of wood chips for its Segezhsky Pulp and Paper Mill.

By strengthening its raw material security, the company is strengthening its position in price negotiations with suppliers.
Therefore, the company may even announce a reduction (in January 2020, the purchase price of the Segezha Pulp and Paper Mill for softwood pulplogs #1-3 was 1450 RUB/m3 excl. VAT, FCA station of departure).

A similar situation exists with the plywood asset of Vyatsky Plywood Mill. Having full warehouses of birch veneer logs harvested in the Vologda Oblast on its own leases forest areas, the plant is not ready to increase raw material prices and keeps them at the level of 2800 RUB/m3 (excl. VAT, FCA station of departure; FSC 100% + 100 RUB/m3).