The Russian Government to slash duties on pulpwood of Far Eastern species to zero and increase export quotas by the end of 2020

Yury Trutnev, Deputy Prime Minister and Presidential Plenipotentiary Envoy to the Far Eastern Federal District, held a meeting on stimulating the timber industry in the Far East; the meeting took place in Moscow on March 26, 2020. The meeting addressed the issue of granting quotas to timber exporters and increasing the degree of wood processing.

To stimulate the timber industry, allowing for the situation with the spread of coronavirus, the slowdown in the business activity of China, the largest consumer of Russian forest products, as well as the increase in duties beyond the quota, the Ministry of Industry and Trade of Russia together with the Russian Ministry for the Development of the Russian Far East proposed short-term measures intended to be valid until the end of 2020. It was particularly proposed to distribute additional tariff quotas of 2 million m³ for the year 2020 among those companies that have not yet received a license to export wood under the quota for this year, as well as to assign quotas only for sawlogs with the contemporaneous exemption of pulp logs from quotas and the establishment of a 0% duty on them.

It is understood that quotas will be granted only to exporting enterprises whose share of processed wood products in the export volume is at least 40%, and a differentiated reduction in the export customs duty rate (from 13 to 0%) will be calculated depending on the share of processed wood products in their exports. Final proposals for consideration by the Russian Government should be submitted until the end of March 2020.