Lesy Ukrainy State Enterprise set another record and sold UAH 8.9 billion worth of unprocessed timber in April-June, according to the company’s CEO Yuriy Bolokhovets on his Facebook page.
“Lesy Ukrainy increased revenues to the state and local budgets by 40%! Tax payments in the first half of the year grew by more than UAH 1.7 billion compared to the same period in 2024,” he emphasized.
Bolochovets noted that the state-owned enterprise uses its after-tax profits to purchase new firefighting equipment (10 large fire trucks are planned in the near future), developing modern seed centers and infrastructure (forest roads, recreational areas, etc.), restoring forestry in de-occupied territories, and mechanizing harvesting (harvesters, forwarders, tractors, etc.).
He highly praised the effect of the six-month forward contracts, under which buyers selected all the timber, which made it possible to achieve 101% of the planned volume.
“Thanks to forward contracts, wood processors can reserve the volume of raw materials they need and fix the price. The company also benefits. The guarantee deposit, which is returned only after 97% of the contract has been fulfilled, motivates buyers to select the entire contracted volume of products. Next year, the share of forward contracts will be increased, with annual contracts planned,” he wrote.
In addition, Lesy Ukrainy has already shipped more than 95% of timber under quarterly contracts for the second quarter. Most of the non-fulfillments are the fault of buyers who either refuse to accept the goods or fail to pay on time.
The state-owned enterprise noted that it pursues a flexible policy on mutual settlements, realizing that producers may experience difficulties with working capital, as they do not immediately receive payment for the timber products they manufacture. However, the enterprise sometimes resorts to suspending deliveries until the buyer settles the debt, which to a certain extent affects the contract fulfillment rate.
“Overall, the situation on the timber market is still balanced. The rapid rise in the euro exchange rate has significantly strengthened the position of Ukrainian exporters, so the forecasts for the second half of the year are more than optimistic,” summarized the CEO of Lesy Ukrainy.
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