RusForest opened pellet production at its LDK-3 mill in Arkhangelsk

RusForest announced the start of wood pellet production at the company’s LDK-3 sawmill in Arkhangelsk. The plant is now in the test-production phase, with full capacity expected by the end of March 2014.

Most of the pellets will be shipped by vessels to Europe, as WhatWood learned from Director, Sales and Marketing of LDK-3 Svetlana Shadrina: the mill has own maritime terminal, while experience in sea transportation is among key competences of the company.

“Arranging contacts with end users, partially through agents, is the strategic decision of the company,” Shadrina concluded. Small part of the products will shipped by trucks to the home market. By the moment, contracts with end customers have not yet been concluded – the company needs to perform tests and obtain certification first.

Pellet production will enable RusForest to capitalize on sawmill by-products. Group CEO Matti Lehtipuu said that the start-up of the mill “gives solid ground to further develop core Arkhangelsk assets.”

The pellet mill will have an annual capacity of up to 100,000 tonnes per year. Major equipment for this project was delivered by Estonian producer AS Hekotek. Total investment for the pellet plant is approximately €12 million, with 70% financed by local bank facilities.