Timber harvesting crews across Russia are closing faster than new ones open, with new registrations down 19.9 per cent to 1,210 in the first eight months of the year. That is according to Rusprofile, a Russian service for checking business partners, which told Russia’s business press on Wednesday that liquidations rose 9.6 per cent to 1,590 over the same months.
“Small, seasonal, independent timber harvesters often decide not to run a business rather than work at a loss,” analysts at Russian timber market consultancy WhatWood said. Its analysts said the drop in registrations could confirm a slide in harvesting, down 5 per cent year on year in the first seven months as demand for finished products stayed low.
It comes as industry sources speaking to the same paper said many harvesting companies kept working in the hope demand would recover, only to run through their safety margin when it did not. Contractors with no processing of their own have been hit hardest, the sources said, as their machinery costs money constantly while payment for the timber comes in late.
Rosstat, the federal statistics service, found that 59.3 per cent of Russia’s larger forestry and timber-harvesting organisations were operating at a loss in the first seven months, compared with 33.4 per cent across the economy. Russia’s financial press ranked timber harvesting, along with coal mining, among the country’s most troubled industries this year, with 64.5 per cent losing money.
New registrations are 25 per cent lower than pre 2021 levels
And whilst liquidations in the sector fell from 4,460 in 2021 to 2,320 in 2025, Rusprofile said the trend has now reversed. New registrations recovered 3.6 per cent to 2,140 last year, the service said, but that still left them more than 25 per cent below their 2021 level.
Alexander Dyatlov, who chairs the forest industry committee of the Arkhangelsk regional assembly, said forestry and harvesting organisations in the region fell 6.8 per cent in the first half of the year. Sole traders fell 12.2 per cent, with Dyatlov blaming the loss of the region’s small and medium-sized firms first on “high competition with a limited volume of available forest resources.”
Arkhangelsk lawmakers drafted a plea to Moscow six months ago for a three-year moratorium on bankruptcy cases brought by creditors, citing sector losses of more than 15 billion roubles over three years. Vladimir Butorin, who owns northwestern timber producer ULK Group, warned at the time that more than half of the forest industry’s remaining companies would not survive 2026 without government help.
Harvesting companies also face paying for their own forest surveys from next September under a new law that lets the state cancel a lease where a company misses its survey deadline. Industry members say the one state agency allowed to do the work is already running up to a year late on its contracts.
“The market is weeding out weak business models more than it is creating conditions for new players to appear,” one industry source said. The forest business is losing its appeal to new investors because of the high cost of entry and the specialised expertise it demands, the sources said.
