Russian Timber Journal 06-2018: In 2017, the timber harvesting decreased by 0.7% in Russia, use of AAC amounted to 29.6%; Ilim Group launched the Big Ust-Ilimsk project; and forest products production in Russia in 2018

Federal Forestry Agency (Rosleskhoz) published the final figures for timber harvesting volumes for all Russian regions in 2017. Timber harvesting in Russia fell by 0.7% down to 2016 level of 212.4 million m3. A significant decline in timber harvesting is observed in the Moscow region (-56.1% to 925 thousand m3), the Vladimir region (-19.5% to 1.45 million m3). A rise in timber harvesting occurred in the Krasnoyarsk region (+24.5% to 23.2 million m3), Smolensk region (+7.8% to 2.2 million m3), the Pskov region (+10% to 1.8 million m3). In the largest region in terms of timber harvesting volumes — the Irkutsk region — for the first time in 6 years a decline was recorded: -1.5% to 34.8 million m3. The use of the annual allowable cut at the end of 2017 amounted to 29.6%.

The State Duma adopted a law on the cancellation of personal income tax when delivering waste paper. The deputies of the State Duma of the Russian Federation adopted in the third and final reading the law that exempts the income from the delivery of waste paper from payment of personal income tax (PIT), as conveyed on the official website of the State Duma. The current developments will allow to increase the volume of collection and disposal of paper waste generated by citizens in everyday life. Previously, the funds received from the delivery of waste paper to a special organization, were considered as income and, accordingly, were subject to personal income tax, which is equal to 13%.

Ilim Group Chairman Zakhar Smushkin and Irkutsk Oblast Governor Sergey Levchenko took part in the official launch of the integrated investment project Big Ust-Ilimsk at Ilim’s Mill in Ust-Ilimsk. The Big Ust-Ilimsk project includes construction of a new line for production of kraftliner and other packaging materials with a capacity of 600 thousand tons per year. Total investments in the project will be around USD 1 billion with implementation to be completed by the end of 2021. The Company will also perform a large-scale upgrade of the existing operations in order to increase pulp output by 130 thousand tons per year. Project implementation will drive the Mill capacity up to 1.5 million tons of finished products per year with an initially installed capacity of 550 thousand tons per year. The Ust-Ilimsk Mill will thus become one of the leading pulp and paper manufacturers in the world. Ilim Group is currently preparing a set of documents required to classify the Big Ust-Ilimsk as a priority investment project in terms of forest management.

New loans of VTB Bank in the Russian forest sector; announced investment projects of Kronospan; new orders of Dieffenbacher for wood-based panels sector; and production data for forest products in Russia in 2017-May 2018 — read in the latest issue of the analytical Journal of Russian Timber Journal №06-2018.