The State Enterprise “Forests of Ukraine” has put up more than 1 million cubic meters of timber for additional auctions, which will be held on the principle of Dutch auctions, the company’s CEO Yuriy Bolokhovets said on Facebook. According to him, this record-breaking amount of wood was accumulated at the expense of unsold products in the fourth quarter of 2023.
“Uncertainty with the borders plus the holiday season in the EU reduced the demand for wood. Many processors have taken a break…. Demand is gradually recovering, but the situation remains difficult in some market segments,” stated the company’s CEO.
Bolokhovets said that due to the blockade of the borders, the losses of the branches of the State Enterprise “Forests of Ukraine” exceeded UAH 1 billion over three months.
“If not for the timely reform, dozens of forestry enterprises would have been on the verge of bankruptcy in January. It is only thanks to subsidies from the central level that employees of all (!) our branches receive their salaries on time. All branches have working capital to carry out their activities, no one has stopped,” he emphasized.
Speaking about the plans of the State Enterprise “Forests of Ukraine” for 2024, Bolokhovets noted that amid unfavorable assessments of the timber market prospects for both processors and sellers of raw materials, the company intends to support the market. There are no plans to reduce harvesting. On the contrary, more than 1 million cubic meters of wood from the closure of state processing will be added to the last year’s trading volume.
“Forests of Ukraine will also continue to work to reduce costs, increase efficiency and eliminate corruption.
“This means mandatory assessment and justification of investments, the most open and competitive procurement, efficient use of equipment and other resources. Sale of unprofitable assets, optimization of the administrative staff. Reducing the cost of the resource through the construction of new forest roads. Finally, eradication of such phenomena as substitution of timber grades and other manifestations of corruption,” stated the CEO of the state enterprise.
As reported, Ukraine launched a forestry reform in 2016. As part of it, the sale of raw wood at electronic auctions has already been introduced. Since 2021, an interactive map of wood processing facilities has been operating in a test mode in a number of regions.
The industry has implemented the Forest in a Smartphone project, which contains a list of logging tickets for timber harvesting and allows you to check the legality of logging on the agency’s online map.
On June 1, 2023, Ukraine launched a pilot for the electronic issuance of logging tickets and certificates of origin of timber. In addition, the State Enterprise “Forests of Ukraine” has launched a pilot project to procure timber harvesting services through the electronic platform Prozorro.
The state specialized economic enterprise “Forests of Ukraine” on December 8 for compulsory insurance of motor civil liability of owners of land vehicles (MTPL).
As reported in the system of electronic public procurement Prozorro, the expected cost of the purchase of insurance services is 189.786 thousand UAH.
The deadline for submitting bids for the tender is December 16.
The State Enterprise “Forests of Ukraine” has announced “tough personnel purges at all levels,” the company’s CEO Yuriy Bolokhovets said on Facebook.
“Throughout the year, the security of the State Enterprise “Forests of Ukraine” recorded the facts of violations, collected information, conducted internal investigations, and passed materials to law enforcement. It was a huge job that took time. But there is a real result,” he wrote and added that the details of the investigation have not yet been disclosed.
As reported, the state specialized economic enterprise “Forests of Ukraine” is one of the largest forest users in Europe and the largest forest user in Ukraine. It is managed by the State Agency of Forest Resources of Ukraine. The company manages 6.6 million hectares of state forest land.
In 2016, Ukraine launched a forestry reform. It has already introduced the sale of unprocessed timber at electronic auctions. Since 2021, an interactive map of wood processing facilities has been operating in a test mode in a number of regions.
The industry has implemented the Forest in a Smartphone project, which contains a list of logging tickets for timber harvesting and allows you to check the legality of logging on the agency’s online map.
On June 1, 2023, Ukraine launched a pilot for the electronic issuance of logging tickets and certificates of origin for timber.
In addition, to combat corruption within the state enterprise, the management of the State Enterprise “Forests of Ukraine” has implemented a pilot project on GPS monitoring of the movement of freight and specialized vehicles in forests to improve the electronic timber circulation system (ETS).
The State Enterprise “Forests of Ukraine” will plant more than 5.5 thousand hectares of new forests in Odesa and Mykolaiv regions, said Yuriy Bolokhovets, CEO of the state enterprise.
“We have started the largest planting of new forests in the history of Ukraine in the South. This fall, we will create more than 5.5 thousand hectares in Odesa and Mykolaiv regions! This figure is incredible. Every year, no more than 200-300 hectares of new forest were planted in the regions. The State Enterprise “Forests of Ukraine” has increased the planting area twenty times,” he wrote on Facebook.
The State Enterprise “Forests of Ukraine” intends to plant mixed forests that are more resilient and resistant to climate change. For planting, the company has selected petiolate oak, maples, pines, ash, and shrubs. The company will supply more than 800 thousand seedlings with a closed root system to the region.
According to the company’s CEO, the area of forests in Odesa and Mykolaiv regions does not exceed 140 thousand hectares. They are mainly for recreational purposes, with only sanitary felling (firewood). The income from timber sales, particularly in the form of firewood, would not even be enough for southern forestry enterprises to pay their salaries. Forestry in the region was chronically subsidized: staff worked on a quarter and half-time basis, there were no fuel and lubricants, no cultivators.
Mr. Bolokhovets named the lack of qualified personnel as one of the main problems of the industry. The Southern Forestry Office currently has more than 400 vacancies: forest master, forester, assistant, etc.
The reform in the industry has enabled the State Enterprise “Forests of Ukraine” to optimize its work and make a profit, which has made it possible to find investments for the development of the southern region.
“Local foresters finally received salaries, equipment, fuel, and planting material. We have started working with communities – in the last two months alone, 1.7 thousand hectares have been transferred for planting. Finally, we have money, equipment, and land,” said the CEO.
The State Enterprise “Forests of Ukraine” intends to make the development program for the southern region a long-term one.
As reported, the state specialized economic enterprise “Forests of Ukraine” is one of the largest forest users in Europe and the largest forest user in Ukraine. It is managed by the State Agency of Forest Resources of Ukraine. The company manages 6.6 million hectares of state forest land.
In 2016, Ukraine launched a forestry reform. It has already introduced the sale of unprocessed timber at electronic auctions. Since 2021, an interactive map of wood processing facilities has been operating in a test mode in a number of regions.
The industry has implemented the Forest in a Smartphone project, which contains a list of logging tickets for timber harvesting and allows you to check the legality of logging on the agency’s online map.
On June 1, 2023, Ukraine launched a pilot for the electronic issuance of logging tickets and certificates of origin of timber.
The state-owned enterprise Forests of Ukraine has increased its profit to UAH 2.6 billion following the results of nine months of work, the company’s director general, Yuriy Bolokhovets, has said.
“This is ten times more than the industry earned before the reform, in the times of state forestry enterprises. We send the lion’s share of profit to the state budget. These are funds for new weapons, ammunition, military salaries,” he noted.
According to the press service of the enterprise, for nine months “Forests of Ukraine” transferred to the state budget 4.7 billion UAH, which is 1.1 billion UAH more than last year. Hundreds of millions more hryvnias the enterprise invested in new equipment for the AFU.
“The record profit was achieved in a falling market. The situation in the timber market has not improved. Compared to last year, the average selling price of an impersonal cube of untreated wood fell from UAH 1.8 thousand to UAH 1.7 thousand. We also gave up our own processing – realization of sawn timber by branches of SE decreased from 2.8 to 2.1 billion UAH”, – explained Bolokhovets.
According to the head of the company, the profit of SE has increased due to detenization and increased efficiency of the state enterprise. The majority of purchases have been transferred to Prozorro, which allowed to eliminate gaps in timber sales related to direct contracts – products are sold at the established competitive market prices.
It is noted that customers are offered additional services, in particular, loading and customs clearance of products. The level of fulfillment of exchange contracts has increased to almost 90%. Services of contractors for harvesting and other works have been standardized, and boundary prices have been introduced.
In addition, the electronic accounting system was improved, which made it more difficult for illegal timber to enter the market, and the demand for legal products increased accordingly. Also, all non-purpose expenses of branches such as “paving stones” were reduced.
State Enterprise “Forests of Ukraine” standardized the staff of branches and reduced unnecessary administrative staff, as a result of which it replaced almost half of the branch managers.
The company has also decided and sells subsidized facilities through the State Property Fund.
“Really counteract fictitious works and services, which in the times of leskhozes were a common phenomenon. We have abandoned the use of expensive and inefficient financial instruments, which previously often led to the leaching of funds from state forestry enterprises – for example, the lease of equipment at unreasonable rates,” – summarized Bolokhovets.
As reported, the state specialized economic enterprise “Forests of Ukraine” is one of the largest forest users in Europe and the largest in Ukraine. It is under the management of the State Agency of Forest Resources of Ukraine. The company manages 6.6 million hectares of state forest lands.
The State Enterprise “Forests of Ukraine” has increased its profit to UAH 2.6 billion in the first nine months of operation, according to the company’s CEO Yuriy Bolokhovets.
“This is ten times more than the industry earned before the reform, in the days of state forestry. We direct the lion’s share of our profits to the state budget. These are funds for new weapons, ammunition, and military salaries,” he said.
According to the company’s press service, over the past nine months, Fores of Ukraine transferred UAH 4.7 billion to the state budget, which is UAH 1.1 billion more than last year. The company invested hundreds of millions of hryvnias in new equipment for the Armed Forces.
“Record profits were achieved in a declining market. The situation on the timber market has not improved. Compared to last year, the average selling price of an impersonal cube of unprocessed wood fell from UAH 1.8 thousand to UAH 1.7 thousand. We have also abandoned our own processing – sales of sawn timber by the SOE’s branches decreased from UAH 2.8 billion to UAH 2.1 billion,” explained Bolokhovets.
According to the company’s CEO, the SOE’s profits have increased due to de-shadowing and increased efficiency of the state-owned enterprise. Most of the procurement was transferred to Prozorro, which made it possible to eliminate the loopholes in timber sales related to direct contracts – products are sold at prices set by competitive markets.
The company emphasizes that its customers are offered additional services, including loading and customs clearance of products. The fulfillment rate of exchange contracts has increased to almost 90%. Contractors’ services for procurement and other work have been standardized, and ceiling prices have been introduced.
In addition, the electronic accounting system has been improved, making it more difficult for illegal timber to enter the market, which has increased demand for legal products. Also, all untargeted expenses of the branches, such as “laying pavement”, were reduced.
SE “Forests of Ukraine” has standardized the staff of its branches and reduced unnecessary administrative apparatus, resulting in the replacement of almost half of the branch managers.
The company has also decided to sell subsidized facilities through the State Property Fund.
“We are really counteracting fictitious works and services that were common in the days of forestry. We have abandoned the use of expensive and inefficient financial instruments that used to often lead to the leakage of funds from state forestry enterprises, such as renting equipment at unreasonable rates,” Bolokhovets summarized.
As reported, the state specialized economic enterprise “Forests of Ukraine” is one of the largest forest users in Europe and the largest in Ukraine. It is managed by the State Agency of Forest Resources of Ukraine. The company manages 6.6 million hectares of state forest land.
