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How the Ukraine crisis will affect timber imports

Posted: Tuesday, March 8th, 2022

In what feels like a return to the dark days of the Cold War, the ongoing crisis between Russia and Ukraine has come to a head as Russian troops crossed the border into Ukraine’s separatist regions.

Given we are the Timber Trade Federation (TTF) and not a geopolitical think tank, we won’t go into too much detail on the conflict, however, I felt it would be a good time to remind members on the import situation with Ukrainian timber as well as the conflicts potential wider impacts for our sector.

Ukraine is said to be the ‘breadbasket of Europe’ with an abundance of natural products including timber products such as Pine, Spruce and Oak.

While Ukraine is certainly a potential source of raw materials in the future, recent timber imports from Ukraine have been restricted, quite rightly, by the concerns raised in the EU joint-enforcement position issued in May 2021.

While we are currently awaiting full year-end figures for 2021 to become available, Ukraine was responsible for 1,947m³ of imports in 2020.

Given the political difficulties with Russia, forestry management changes are unlikely to have figured within the Ukraine Government list of priorities, so it is anticipated UK traders will have heeded the warnings from the EU and non-governmental organisations (NGOs) and undertaken fewer purchases from Ukraine during 2021.

An area of the conflict we will watch closely is the sanctions imposed on Russia. Though purely financial at this stage, it is likely sanctions will go further in the coming weeks.

Russian timber accounts for a sizeable section of UK softwood, hardwood, and plywood imports, with a total of 456,810m³ imported last year alone. We will be watching closely to see if sanctions extend to our sector or have any impact on members’ business.

It is also worth noting the potential macro-economic impact this conflict may have, with further energy and inflationary pressure likely.

Russia is a large exporter of gas into Europe, and a further escalation in the conflict is likely to increase already high fuel prices on the continent.

Though the UK imports very little Russian gas directly, a rise in European energy prices is likely to affect the logistical costs of timber imports in the UK.

We will be sure to keep you up to date with any timber-related developments as the situation develops.

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