The price privileges granted by the Ministry of Forestry will not enable the ‘Bellesboomprom’ Trust to become completely self-sufficient by 2008, reckons Mikhail Kuzmenkov, the Director of the Timber Department at the Belarusian Ministry of Forestry.
The ‘Bellesboomprom’ Trust is the biggest timber-processing association in Belarus incorporating many forestry factories. Forestry Minister Peter Semashko said at a press conference that the government “allowed such an indulgence” (the minimum possible price for timber) for the trust in order to make these factories self-sufficient and enable them to raise some extra funds for equipment upgrade.
Nevertheless, the minister is quite convinced that the programme, endorsed by the government (on March 7, 2004, No. 245) to bring this industry to self-sufficiency, will be accomplished. According to him, the share of state budget expenditures in the forestry industry reduced to 62 per cent last year. This year it is 52 per cent. “Therefore I have no doubts that we will reach the planned 50 per cent this year,” says Semashko.
The Ministry of Forestry is going to cope without state subsidies by selling only ready timber and processing more timber within the country. So, if one cubic metre of ‘standing wood’ costs three thousand Belarusian roubles, then ready logs cost 60-80 thousand roubles. Semashko said that before customers used to buy ‘standing wood two a penny’ but now “wood is becoming valuable”. According to him, it will make selling timber more transparent, and will reduce “various abuses” to the minimum.
The minister is convinced that setting single prices for all customers, increasing export, and some other measures to improve the utilisation of timber will facilitate self-sufficiency in this industry.
Semashko says that all types of saleable timber in the domestic market are being sold at the minimum prices. However, the minister plans to move to market-like relations within next two years. Privileged prices will be used only for social sphere. “Not all domestic customers will be able to work this way,” admitted the minister, “Nevertheless, it will be only prepared timber that will go for sale and only through the Exchange both for domestic and foreign customers.”
Growing Exchange sales will allow the single price for timber to be set, reckons Semashko. But in this case, special timber exporters will “die off” or transform into brokerage houses. At the moment, there are four special timber exporters in Belarus. The bulk of sales go through the Forestry Ministry’s special exporter ‘Bellesexport’.
Increasing markets for petty timber should also facilitate independence from the state donations. The main customers of the Belarusian petty timber for processing it into cellulose are Russia, Finland, and Poland. Processed saleable timber is being marketed in 20 countries. Semashko sees the Middle East as another promising market.
By the way, the timber industry exported 61.9 million US dollars’ worth of timber and corresponding services in 2004. The Minister said that the export sales should reach a mark of 80 million dollars this year.
Peter Semashko also mentioned some other ways of using the forestry resources and said that for instance, expanding hunting tourism, processing forest berries and mushrooms, will allow the industry’s export potential to increase.