Russia to postpone export tariffs on roundwood
Plans to remove birch fibre duties also voiced
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The Russia-Finland Forest Summit held in St. Petersburg on Sunday, at which Finnish Prime Minister Matti Vanhanen met his Russian colleague Vladimir Putin, produced a mixed bag of results.
Putin reported that Russia would not be introducing the planned increase in export duties on roundwood from the beginning of next year, and that it was possible the moratorium could extend into 2011.
It had previously been assumed the increased EUR 50 duty would have taken effect from January 2010, as Russia seeks to support its own wood processing industry and to shrug off its role as a supplier of raw materials - oil & gas, bio-resources, and timber.
At the same time it was hoped the increased tariffs would encourage foreign investment in the Russian forest industry. Thus far the principal result of the moves has been a sharp decline in exports to Finland of Russian wood.
After meeting Vanhanen, Putin promised that there could be a complete removal of export duties on birch pulpwood in the future.
This met with more approval from Vanhanen, who worries along with the Finnish industry representatives that the postponement of the planned increase is not enough in practice.
Finnish pulp & paper companies, which rely heavily on cheap Russian wood, have threatened to close mills and cut jobs if the timber dispute is not resolved.
As it is, Putin made it clear that Russia is not actually going to abandon its project to hinder the free flow of raw timber out of the country.
Simply putting a freeze on the anticipated increase left the Finnish paper manufacturers who were in attendance at the meeting rather unsatisfied.
The industry has adapted to the current EUR 15 tariff and has moved its production over to softwoods (conifers), as well as using cheaper eucalyptus grown in the southern hemisphere.
In addition to the problems with the export tariffs, the branch has been hit badly by the economic downtown, which has reduced demand and led to capacity downsizing.
In the long term, Russian birch is still interesting to Finnish processors, although investments in Russia have been frozen ever since the crisis emerged.
The roundwood tariffs were the main subject of the two prime ministers' discussions, but other topics that were explored included energy, transport cooperation, protection of the Baltic Sea, and the December climate summit in Copenhagen.
The energy talks were dominated not surprisingly by the Nord Stream gas pipeline from Russia to Germany.
The Finnish government is to decide on a permit for the undersea pipeline on November 5th, and the environmental authorities are expected to provide their own permit by the end of the year, said Vanhanen.
Russia also proposed collaboration with Finland on the design and building of ice-reinforced ships, and Helsinki and St. Petersburg signed a cooperation accord covering the period from 2010-2012, but there was no breakthrough on Russian plans to move container transports from the roads to railways. Finland has opposed the Russian Customs' proposals, first put forward earlier this year.
The meeting and summit also coincided with the opening of the refurbished Suomi-talo ("Finland House") in St. Petersburg, although the building is still technically unfinished and still requires the approval of the Russian authorities before the designated occupants - the Finnish St. Petersburg Institute, a school, city delegations, and Finpro - can formally move in.
Putin reported that Russia would not be introducing the planned increase in export duties on roundwood from the beginning of next year, and that it was possible the moratorium could extend into 2011.
It had previously been assumed the increased EUR 50 duty would have taken effect from January 2010, as Russia seeks to support its own wood processing industry and to shrug off its role as a supplier of raw materials - oil & gas, bio-resources, and timber.
At the same time it was hoped the increased tariffs would encourage foreign investment in the Russian forest industry. Thus far the principal result of the moves has been a sharp decline in exports to Finland of Russian wood.
After meeting Vanhanen, Putin promised that there could be a complete removal of export duties on birch pulpwood in the future.
This met with more approval from Vanhanen, who worries along with the Finnish industry representatives that the postponement of the planned increase is not enough in practice.
Finnish pulp & paper companies, which rely heavily on cheap Russian wood, have threatened to close mills and cut jobs if the timber dispute is not resolved.
As it is, Putin made it clear that Russia is not actually going to abandon its project to hinder the free flow of raw timber out of the country.
Simply putting a freeze on the anticipated increase left the Finnish paper manufacturers who were in attendance at the meeting rather unsatisfied.
The industry has adapted to the current EUR 15 tariff and has moved its production over to softwoods (conifers), as well as using cheaper eucalyptus grown in the southern hemisphere.
In addition to the problems with the export tariffs, the branch has been hit badly by the economic downtown, which has reduced demand and led to capacity downsizing.
In the long term, Russian birch is still interesting to Finnish processors, although investments in Russia have been frozen ever since the crisis emerged.
The roundwood tariffs were the main subject of the two prime ministers' discussions, but other topics that were explored included energy, transport cooperation, protection of the Baltic Sea, and the December climate summit in Copenhagen.
The energy talks were dominated not surprisingly by the Nord Stream gas pipeline from Russia to Germany.
The Finnish government is to decide on a permit for the undersea pipeline on November 5th, and the environmental authorities are expected to provide their own permit by the end of the year, said Vanhanen.
Russia also proposed collaboration with Finland on the design and building of ice-reinforced ships, and Helsinki and St. Petersburg signed a cooperation accord covering the period from 2010-2012, but there was no breakthrough on Russian plans to move container transports from the roads to railways. Finland has opposed the Russian Customs' proposals, first put forward earlier this year.
The meeting and summit also coincided with the opening of the refurbished Suomi-talo ("Finland House") in St. Petersburg, although the building is still technically unfinished and still requires the approval of the Russian authorities before the designated occupants - the Finnish St. Petersburg Institute, a school, city delegations, and Finpro - can formally move in.
Helsingin Sanomat