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. Last Updated: 07/27/2016

Trutnev Throws Weight Behind Timber Industry

Russia must act to raise the income generated by its timber industry, Natural Resources Minister Yury Trutnev said at Thursday's Cabinet meeting.

Too much high-quality unprocessed timber is leaving the country for markets in Western Europe and Asia, leading to a shortage in Russia, Trutnev said, according to a copy of his speech posted on the ministry's web site.

He called for an increase in export charges on high-quality raw timber. Increasing export charges would both raise income for the state and also keep more of the country's timber at home for Russia's own processing plants to use.

Russian processors, which are geared toward high-quality raw timber, currently operate at 85 percent capacity, ministry spokesman Nikolai Gudkov said.

Trutnev also urged that forests be reclassified to allow more logging.

Gudkov said the ministry recommended raising the export duty to 8 percent of the price of the product, from 6.5 percent currently. The minimum amount levied would rise to 5 euros per cubic meter from 2.5 euros ($2.95) per cubic meter currently.

Vladimir Beloglazov, the director of Arkhangelsk Pulp and Paper Mill, said that Russian wood processors had been asking for an export duty increase for a long time. He said 65 percent of the timber his factory used was local, and the rest was shipped in from other regions.

"It would probably be better for the region to process it here," he said.

The resources ministry has already approached the Economic Development and Trade Ministry, which oversees customs policy, Trutnev said. A spokeswoman for the Economic Development and Trade Ministry said a committee had suggested leaving the export duty rate at 6.5 percent, while increasing the minimum amount levied to 4 euros per cubic meter. The proposal had not yet been sent to the government, she added. The timber industry makes up 4.3 percent of Russia's GDP.