Russia’s largest forest company has reported a net loss of 88 billion rubles (around US$1.1 billion) last year, four times the prior year’s 22 billion ruble loss. That is according to Segezha Group’s full-year results, which showed revenue falling 12 per cent to 89 billion rubles as weaker sales volumes, soft pricing, a strengthening ruble against sales currencies and rising costs combined to batter the Moscow-listed producer.
China, which accounted for 77 per cent of Segezha’s lumber sales, remained the single biggest drag on performance, with the company citing weak demand and sustained pricing pressure throughout the year. Lumber sales volumes fell 9 per cent to 2.1 million cubic metres, whilst the company pushed the domestic share of sales at some wood-processing sites as high as 69 per cent to absorb volumes stranded by the Chinese downturn.
Birch plywood sales were broadly flat at 173 thousand cubic metres, down 1 per cent year on year, as shipments to China and India fell and demand weakened across flooring, furniture and transport. Segezha cited tariff restrictions and India’s BIS certificate requirement as factors squeezing exports, reporting a 50 per cent jump in domestic shipments to end customers in Russia as a partial offset.
Interest and other financial expenses of 35 billion rubles, together with 36 billion rubles of losses tied to a revised long-term strategy and production reorganisation, accounted for the bulk of the 2025 hit. Segezha said the charges included asset write-downs on frozen projects, conserved capacity at one sawmill, and changes to sawing volumes and log-quality parameters across its Siberian wood-processing footprint, based on forecast cash flows.
Industrial packaging volumes fell 12 per cent as demand for building-materials packaging collapsed after tighter monetary policy and the end of subsidised mortgages cooled Russian construction. The company said it partly offset the domestic decline by lifting exports into the Eurasian Economic Union and CIS markets, though those volumes remain a fraction of the scale lost in Europe after the 2022 sanctions cut.
Segezha said it had approved an updated medium-term strategy focused on financial stability and cash-flow stabilisation, with plans to pursue asset “rehabilitation,” operating efficiency measures, and higher sales volumes. Planed-wood product sales rose 13 per cent in 2025, and capital spending was cut 37 per cent to 4.6 billion rubles, with the company saying future capex would stay focused on maintenance rather than expansion.
The results come as Russia’s forest industry has warned that up to 50 per cent of companies could shut by the end of 2026, with regional lawmakers in Arkhangelsk pushing Moscow for a three-year moratorium on creditor-initiated bankruptcy cases alongside tax deferrals and a freeze on debt collection for liabilities accumulated before 1 January 2026. Wood Central reported earlier this month that Segezha Vice President Nikolai Ivanov had backed the Arkhangelsk push, saying the issues raised were “critically important and relevant for all forest regions of Russia.”
The European market has been closed to Segezha since 2022 sanctions, leaving China the main remaining outlet for Russian lumber and now dragged down by a property downturn entering its fifth year. Official Chinese data showed real-estate investment fell 11 per cent year on year in January to February 2026, whilst sales of newly built commercial housing by floor area dropped around 14 per cent over the same period.
Russian data shows the country’s share of China’s softwood lumber imports has fallen 6 percentage points year on year, with Canada, Sweden and Finland taking the volume. Segezha routed 77 per cent of its 2.1 million cubic metres of 2025 lumber sales through China, with no alternative market at scale to replace it.
