Segezha Group intents to set up a new birch plywood production plant in the Kostroma Region of Russia

Segezha Group, a subsidiary of Sistema PJSFC and a leading Russian vertically integrated forestry holding with a full cycle of logging and advanced wood processing, signed the agreement of intent with the Government of the Kostroma Region of Russia to set up a birch plywood production facility in the region.

According to the announcement, the agreement specifies the main project settings and timber resources required, as well as measures of state support and cross liabilities. Estimated project funds, including forest management under lease agreements, will come to circa RUB 8-9 billion. The annual design capacity of production by output product lines stands at about 100 000 m3. Over 500 new jobs are expected to be created with the new production plant startup.

Based on to the signed “roadmap”, Segezha Group will conduct the shortlisted investment sites valuation by resource categories (location, staff, logistics, energy- and water supply and water discharge) as early as in 3Q2017. Construction works startup is slated for late 2018, and the first marketable yield is expected in 2020.

Kamil Zakirov, Segezha Group’s President and Chairman of the Management Board, commented:

“We are sure, that meaningful cooperation with Kostroma Region will provide growth points for us and for the region, promote social infrastructure and improve living standards for the population. In addition, in order to develop skilled personnel for the new plant we will engage in cooperation with higher educational institutions and vocational schools of Kostroma Region.”

Russia is among the top-5 global plywood manufacturers and exporters. For Segezha Group plywood is one of the most profitable products in the export portfolio. The company’s production cost is two times lower than at the European peers and by 15-20% lower than at other Russian producers.

Earlier Segezha Group reported 60.9% increase of OIBDA amid 36.3% increase of revenues in 4Q2016 y-o-y.

About Segezha Group:

The company is one of the largest Russian forest industry holdings with the vertically integrated structure and a full cycle of logging and added-value wood processing. The holding comprises Russian and European enterprises in the forest, wood processing and pulp and paper industries, as well as paper packaging.  Segezha is ranked: No. 1 in Russia (52%) and No, 2 in Europe (16,5%) for paper sack production, No. 1 in Russia (71%) and No. 4 in Europe in terms of high-quality unbleached sack paper production , No. 5 in Russia and the world’s No. 7 for large-sized birch plywood production, No. 1 in Russia for sawn timber production – 904 thousand cubic meters per year, and No. 1 in Russia for glulam house sets – the volume stands at 25,5 thousand cubic meters per year.

Source: Woodbizforum