Valeriy Sergeevich Sukhanov, D. Eng., Honored Worker of the Russian Forest Industry: “The Russian timber industry has degraded”

On the cusp of drastic changes occurring in the Russian timber industry, it was thrilling to talk to a professional whose experience in this area spans over six decades.

Valeriy Sergeevich Sukhanov started his career as a timber foreman and Woodworking & Fiberboard Shops Manager at the experimental timber industry enterprise of the Central Research and Development Institute of Timber Industry Mechanization and Power Engineering in the Novgorod Region; he has spent over 20 years at its branch in Khimki, working his way up from a postgraduate student and junior researcher to the institute’s Academic Secretary and Doctor of Engineering Sciences.

Mr. Sukhanov has worked at the State Timber Industry Research Center as First Deputy Director General for Technologies and Power Engineering for over 15 years, moving on to lead the Principal Timber Industry Research Center for Technologies and Power Engineering.

Mr. Sukhanov was granted the title of an Honored Worker of the Russian Forest Industry by an executive order of the President of Russia. In 2012–2013, Mr. Sukhanov was a member of the working group and the editorial group preparing materials for the meeting of the Presidium of the State Council on issues of the Russian forest sector, and also a member of the expert consulting board on the forest sector of the Committee of the Russian State Council for agricultural and food policy and management of natural resources.

We asked Mr. Sukhanov about the problems and challenges currently faced by the Russian timber industry.

Valeriy Sergeevich, what is your assessment of the current situation in the Russian timber industry as a whole in 2022? Is the timber industry fighting for survival, or are there chances of development or renaissance?

If we compare the development of the timber industry with the Soviet period, we could say that the Russian timber industry has degraded. Its share in the country’s GDP has reduced from 2.8% in 1990 to 0.8%, i.e., by 3.5 times. As the President of Russia has remarked, Russia’s share in the global trade of timber products reduced by an order of magnitude over the last decade of the 20th century, from 18% to 2%. The harvesting industry has degraded, the wood chemical industry has ceased to exist, while the pulp & paper and woodworking industries stopped developing.

Not a single pulp and paper mill has been built during the post-Soviet period. Almost all large timber enterprises have transferred to foreign jurisdiction. The domestic forestry machine-building has been ruined, and the timber industry research – 30 institutions – has been uprooted. But most importantly, the timber industry management system has been destroyed under the slogan “the market will adjust itself”. Today, the Russian timber industry is a huge ship without aim or direction.

The harvesting industry needs restructuring and upgrading, as a considerable part thereof has fallen to pieces, and only 7% of the total number of enterprises are capable of building haul forest roads. The industry has lost the direction of its development. It increasingly switches from the whip technology to cut-to-length harvesting. This is a strategic mistake. The cut-to-length technology is greatly inferior to the whip technology, especially the technology of harvesting and hauling whole trees, in forests not subjected to improvement cutting, i.e., all forests in our country. Under our circumstances, almost a half of the timber harvested as whole trees can be processed into raw material for other enterprises, which reduces the cost of raw wood. The experience of the USA and Canada confirms it, as these countries learned the whip technology from us back in the Soviet times and have improved it considerably.

The degradation of the forest industry and the loss of the whip technology have negatively affected not only its own operation. This industry is the basis, the foundation of the timber industry. The cost of raw wood accounts for the greatest share in the cost of products of all timber industry sectors. A blow has been dealt to the entire timber industry.

Another powerful means of reducing the cost of raw wood is utilizing low-quality timber and wood waste. The most efficient way to use such timber is generating thermal and electrical energy at co-generation thermal power plants located directly at timber industry enterprises. It is harvesting enterprises that generate about 78% of the total wood fuel volume. The generated energy is 2–3 times cheaper than the existing rates. However, no steps are made to develop power engineering based on wood fuel.

The collective West has dealt a catastrophic blow to the timber industry by imposing sanctions on supply of harvesting machines and equipment. We have yet to hear about any specific actions to solve this problem.

On January 17, 2023, the President of our country answered the question about the state of the timber industry better than I ever could, when he said that the export-oriented timber industry and automotive industry took the sharpest nosedive.

What is your opinion of the adopted Forest Sector Development Strategy until 2030?

The work on the Strategy that was developed by Strategy Partners Group, a Russian consulting company, together with its coauthors, three consulting firms from the USA and the United Kingdom, and endorsed by Decree of D.A. Medvedev, Chairman of the Russian Government, No.1989-r dated September 20, 2018, ended in a great embarrassment. The new Government led by M.V. Mishustin considered it to be unsatisfactory in terms of forest management activities, although the timber industry part was even worse.

The Government adopted an updated Strategy with Decree No. 312-r dated February 11, 2021. A year later, the action plan on Strategy implementation was approved by Decree of the Government No. 510-r dated March 16, 2022, which was half a year overdue.

The Strategy is primarily aimed at improving the efficiency of the forest industry and doubling its share in the country’s GDP.

It is proposed to put the greatest effort into adding most of the timber processing value within our country, so that modern enterprises producing paper, cardboard, plywood, construction materials, biofuel, and furniture opened in Russia.

The Strategy notably says nothing about the fact that only forest management R&D institutes are left in the forest sector and the research and development science of the timber industry was entirely destroyed.

The key goal of the updated Strategy, as well as the discarded one’s, is developing processing industries, including the pulp & paper industry. State support includes only partial reimbursement of the costs of building all-year-round forest roads.

The Action Plan contains 56 items across seven sections. If you read the sections of the Plan, you will see that this document is obviously skewed towards forest management, as only one section out of seven is devoted to the timber industry (Support of Projects for Developing Processing Enterprises), i.e., 5 actions out of 56. Several actions ended up “hidden” in other sections. It is the timber industry, however, that must earn the money for implementing extremely expensive forest management operations.

Developing the Forest Sector Strategy and the Plan of its implementation is obviously the tip of the iceberg, the very beginning of a very important work. But even this part contains big errors.

Read the full interview in the Russian Timber Journal 01-2023.