Russian lumber production is rising despite deteriorating sales and falling exports, driving inventories higher as weak household purchasing power limits the domestic market’s ability to absorb excess supply, according to the monthly Russian Lumber Industry Insights report.
Companies are trying to maintain production volumes, the report said, but warehouse stocks are rising because domestic demand is weakening. The ministry in May sharply reduced its growth outlook, revising GDP growth for the current year to 0.4% and to 1.4% in 2027, and reported that the economy contracted by 0.3% in the first quarter. The budget deficit for January–April reached 5.9 trillion rubles, equivalent to 2.5% of GDP and about 1.5 times the government's annual plan. Construction activity is also down: the area of completed construction in April 2026 fell 21% versus March to 6.5 million m2 and was down 4% year-on-year, while housing commissioning from January to April dropped 24% compared with the same period a year earlier.
At the same time, the crisis in China's construction sector has reduced import demand and intensified price competition. In April 2026 China's imports of softwood lumber fell 33% year-on-year to 967,000 m3. Exports from Russia to China fell 34% in April, while shipments from Canada rose 4%; Belarus's exports to China fell 40% and Finland's fell 59%. Buyers ultimately favour lower prices, and lower‑priced Canadian lumber is gradually displacing higher‑priced Russian and Belarusian products.
Logistics costs for Russian suppliers continue to rise, the report said, further reducing the profitability of shipments. Taken together, weakening domestic demand, lost market share in China and higher transport costs are creating pressure on exporters and contributing to a buildup of stocks. The report presents these developments as the current market reality without issuing a formal forecast for how quickly inventories might be drawn down if conditions change.