The Russian boards’ sector shows good dynamics this year despite the ongoing pandemic and the sky-rocketed prices for most of the industry’s product range.

These have been observed since the beginning of the current year, according to recent statements made by representatives of leading local producers and analysts in the region.

This year a number of large-scale investment projects were resumed in the industry after a long pause of almost a year caused by the pandemic and its consequences. That led to additional supplies of boards to the domestic market, which currently experiences an increased demand, triggered by a booming construction sector.

“The main driver of the current growth of the demand for boards in Russia is a rapid development of housing construction in Russia,” said Timur Irtuganov, general director of the Association of Furniture and Woodworking Enterprises of Russia (AMDPR).

“In fact, the demand for boards in the domestic market has been steadily growing since June 2020,” continued Mr Irtuganov.

“According to our data in the second half of 2020 and the first half of 2021, the demand significantly exceeded the pre-pandemic figures.”

The existing demand contributes to the growth of investment activities in the industry.

According to Mr Irtuganov, in 2021, two factories launched by Kronospan started operating at full capacity again.

These are the enterprises of the former Russian Laminat group of companies – chipboard factories in Sergiev Posad, Moscow Region, and in the Smolensk Region, in the Igorevsky District. The total capacity of the factories is about 400,000m3 of particleboard per year.

“The Kronospan company also launched a large-scale production of MDF in the Kaluga region; in September this year,” said Mr Irtuganov.

“In November, the plant should reach its design capacity, which will be about 400,000m3 of MDF per year.”

Representatives of Kronospan Russia were not available for comments.


In the meantime, the Austrian company is not the only global major that continues to strengthen its position in the Russian market.

Swiss Krono – another global major, operating in Russia – is currently involved in the building of a large-scale OSB plant in Sharya, which is in the Kostroma region, with the planned volume of investments of about RUB20bn.

Production is scheduled to start in 2023 and it is planned that the Sharya plant will produce over 600,000m3 of products per year and will have the status of being the largest OSB plant in Russia.

In general, the OSB segment is currently on the rise in Russia, which stimulates the launch of new investment projects in the local market, both from foreign and domestic companies.

One such company is CJSC Murom, the Russian producer of boards and plywood, which is based in the Vladimir region of central Russia. CJSC Murom’s new OSB plant is gradually reaching its design capacity of 230,000m3 after its commissioning in June of the current year.

The volume of investments in the project amounted to RUB7bn (US$98.2m). It created more than 200 new jobs, while future output of the plant will be supplied both to domestic market and for exports.

According to the company, the new production is waste-free, which is a first for Russia.

“This is a truly unique technology,” said Olga Tikhonova, director of the company, during the official launch of the plant.

“It will be used for the first time in Russia. We already have orders for our products and are planning to sign other contracts with both Russian and foreign customers. Currently we still have some free premises and areas in the territory of our plant, which may provide us an opportunity for a further expansion of production already in the short-term.”

According to the company, the new production facility uses by-products of its own production, operating on the basis of the concept of resource conservation. The company is also hopeful that the provision of new forest lands will create conditions for a further expansion of its production.

Currently, CJSC Murom already operates significant forest areas in the Vladimir region. These forest areas are primarily located in the Aleksandrovsky and Kirzhachsky districts of the region.

Implementation of the project is supported by the Russian federal government and the authorities of the Kostroma region.

Overall, the development of the board industry has become one of the priorities for the Russian federal government in recent years.

This is also confirmed by a recent visit of Russia’s Minister of Industry and Trade, Denis Manturov – a state official responsible for the development of the boards industry – to the Komi Republic, where a new MDF plant is currently being built by LLC Luzales, which is one of the largest sawmills in Russia with the volume of harvested timber more than 1 million m3 in 2020.

Building of the plant became part of an investment agreement, signed between the company and the Komi authorities this summer at the St Petersburg International Economic Forum.

The new MDF plant will be built in the Syktyvdinsky region of the Komi Republic within the territory of the special economic zone of “Sever”, while the volume of investments will reach an almost record RUB32bn (US$449m).

The plant will have a capacity of 1 million m3 of finished products per year and create more than 1,200 jobs.

“The construction of a new MDF plant is an important strategic step for our company,” said Ruslan Semenyuk, chairman of LLC Luzales.

“We are systematically working to select areas for further investment development. Luzales is committed to the development and implementation of waste-free production technologies,” added Mr Semenyuk.

“The construction of the plant will allow us to process low-grade wood and ensure the production of competitive high-quality products.”

In the meantime, Timur Irtuganov from the Association of Furniture and Woodworking Enterprises of Russia said other investment projects are also planned for implementation in Russia in the coming years.

“Over the next year and 2023, a number of large-scale projects for the production of all types of boards including OSB, particleboard and MDF will be launched in different parts of Russia,” said Mr Irtuganov.

“In 2022-23, we are expecting the launch of a particleboard production project by Kastamonu in Tatarstan Republic, a centre of Russian petrochemical production and the project of Uvadrev-Holding, another leading Russian producer in the Uva district of Udmurtia Republic.”

According to local analysts, in general the Russian board market has become quite chaotic due to the pandemic, which means that most local producers are not able to predict the level of their localisation within the next several months. In addition, the market is highly dependent on imported components – primarily chemical components for resins.

This year the Russian boards market faced a sharp increase in prices, which became part of a general trend of major growth of prices for construction materials in the local market.

According to various estimates, the growth of prices was equivalent to 300%, compared to the previous year, which forced the Russian anti-trust regulator, the Federal Anti-Monopoly Service (FAS), to initiate proceedings against some leading local producers.

Last month the Russian RBC business paper reported the opening of proceedings against Kronospan Group, one of the leading players in the Russian market.