Forest stock and harvesting
Total area of commercial forests makes up 8.721 mln ha, available forest stock exceeds 1.6 bln cubic meters. Allowed annual cut estimated 23.0 mln cubic meters.  

Regional enterprises produce 7% of Russian commercial wood. In 2005 local harvesting companies produced 6 068 thousand cubic meters of commercial wood, in January-September 2006 – 4 874 thousand cubic meters (98.8% as compared to the same period of 2005).It should be stressed that smaller harvesting companies gradually increase their share in the overall harvesting volume. 

Wood processing
Regional enterprises produce 6% of Russian sawn timber.In 2005 over 1 mln cubic meters of sawn timber was produced in the region, in January-September 2006 - 837.4 thousand cubic meters, which is 104.9% as compared with the same period of the previous year.  Plywood production show promising results: a 114.5% increase in 2005 (up to 189.9 thousand cubic meters), further 122.5% increase during the first 9 months of 2006- up to 171 thousand cubic meters. 

Main direction of wood processing development in the region is connected with sawn timber facilities development. Thus, new facilities for production of 164 thousand cubic meters were launched in 2005.

According to the regional Strategic programme of timber industry development, by 2010 volume of sawn timber production in the region will reach 1600 thousand cubic meters.  

Bio-fuel production is among the most developing sectors of timber industry in the Vologda region. Production of wood pellets started in 2005. During the first year local companies produced about 10 thousand ton. Currently 7 bio-fuel producing factories operate in the region – from smaller facilities with the annual capacity 7 thousand ton (investment amount about 345 thousand USD) to large completely automated plants with the annual capacity 50 thousand ton (investment amount about 9 mln USD).

In 2006 pellet production volume increased as much as 4 times (40 thousand ton), 120 thousand cubic meters of low-quality wood having been utilized. According to the forecasts, in 2007 volume of bio-fuel production will reach the index of 100 thousand ton.

Investments
During the period 1997-2005 over 600 mln USD was invested in the regional timber industry modernization and development, which caused over than twice increase in timber industry production output. In 2007 over 18.5 mln USD is expected to be invested in development of this sector.  

Investment potential
According to Raexpert rating agency, the regional average investment potential in is ranked on the second highest level among forest regions of Russia (36 out of 89 points. In terms of its natural resources related constituent of investment potential, the Vologda region has the highest index as compared with the other forest regions of the country.    

Investment risks
The Vologda region is characterized by the lowest index of investment risks (according to Raexpert agency) – 16.3 out of 89 points. 

Main actors (holdings)
NLK, Vologodskie lesopromyshlenniki 

Production output