Forestry today is one of the most promising directions for Tyumen Region economy development. Forest cover over 11 million hectares of land. The region demonstrates versatile industry forest usage ranging from timber harvesting to high-value product manufacturing. We discussed the Tyumen Region Forestry and investment project protentional with the Tyumen Region Forestry Department Head, Vladimir Artanovskiy.
Vladimir, people tend to believe that forestry is not the best area for making money due to production facilities low profitability. Do you agree with the statement?
I wouldn’t say that many people share this thought. We’ve already adopted a nice tradition in our forum and conduct annual “Technologies. Territories. Personnel.” Tyumen Investment Forum. Every year we register interest to the forest business. In 2016 10+ forestry investors arrived to our region. We discussed and reviewed a number of projects ranging from school furniture production to cellulose and timber processing facilities. We even had projects related to bioenergy business. Oversimplified forest harvesting companies – i.e. following the cut a tree and sell timber model – may not report a continuous financial stability and high profitability values. However, Tyumen Plywood Manufacturing Facility is a large and steadily developing production facility. Moreover, the facility annually increases its production capacity. Furthermore, the facility currently exports 75% of plywood. Both M&S business may run smoothly with the right approach. High-value wood products is mandatory in our daily life. This clearly means constant demand and steady market. In Tyumen we promote wood recycling within the region and do hope to achieve 100% recycling rate.
You’ve mentioned the M&S business. Forestry is challenging field that requires specific skills and technology. If we set various SMB achievements aside, what are the main challenges or problems that slow down the active development of the business?
First, we are trying to make Forestry industry transparent. It shall be clear to SMB. For instance, in 2015 Forestry Department, Economy Department, and Municipalities Development Council already included the Forestry development programs into their roadmaps. In its turn, the Tyumen Region Investment Agent Fund developed six typical business project with investment amount from 500,000 to 10,000,000 RUR. Any entrepreneur may use the fund. The entrepreneur will not have to waste any time on studies and calculations but will be able to get all the answers from these projects and select the most appropriate field.