There is a sharp disconnect between reality and the forecasts for Russian-Chinese timber trade. Economists in 2020 predicted a massive increase in trade volume; in reality, volumes have shrunk due to Russia's imposed export bans on raw logs, the war in Ukraine, and subsequent Western sanctions. Russian timber—especially birch plywood—is being illegally 'laundered' through China and other third countries using forged certificates of origin to bypass European Union sanctions.

“Didn't measure seven times”

Three Chinese economists predicted that 95 million cubic metres of Russian sawn timber would flow into China in 2025; Chinese customs recorded only 12.4 million cubic metres in total.

It was predicted that Russian sawn timber imports into China would reach up to 95 million cubic metres per year by 2025, which would be a sevenfold increase compared to 2016. This model was published 19 months before Moscow banned the export of logs and 20 months before the invasion of Ukraine. The authors of the forecast, Yongzhi Chang, Binjie Liu, and Minghong Gao, are economists from the North China Institute of Aerospace Engineering, Renmin University of China, and Tianjin Chengjian University, whose Grey-Markov model was published in the International Journal of Sustainable Development and Planning as early as June 2020.

According to China Timber Net data, the General Administration of Customs of China recorded only 12.4 million cubic metres of all types of timber from Russia in 2025, which is 8.9% less than before and worth a total of 2.55 billion US dollars. Of this volume, 10.15 million cubic metres were conifers. For comparison, in the base year of the study (2016), the volume of sawn timber alone was 13.4 million cubic metres, and it was predicted that their value would grow from 3.3 billion US dollars in 2017 to 5.05 billion by 2025.

Chinese scientists predicted that Russian roundwood shipments would decrease from 12.8 million cubic metres in 2016 to 6.8 million in 2025, explaining this by the export tariffs that Moscow imposed at a rate of 10% in 2007 and increased annually. The UN Food and Agriculture Organization (FAO) reported that in 2003, Russia provided 60% of China's log imports, mainly larch and Mongolian pine.

Russia completely banned the export of raw coniferous wood and valuable broadleaved species from 1 January 2022. By 2025, Chinese customs concluded that Russia provided 16.5% of the 7.5 million cubic metres of hardwood logs imported by China, with Latvia being one of the two main suppliers of birch logs, and 285,560 cubic metres of finished plywood, which accounted for 88.6% of the smooth plywood purchased by China.

“Blood birch”

Government representatives were urged to attract investment to timber processing parks in border ports – Heihe, Suifenhe, Manzhouli, and Erenhot – giving priority to deep wood processing plants. It was particularly emphasised that every batch of imported timber should have a certificate of origin, which must not be approved for processing or re-export before official importation. The exporter's legal certification had to be a prerequisite for sustainable trade.

An investigation by the organisation Earthsight, with the evocative title “Blood Birch”, revealed how, since the entry into force of sanctions in July 2022, more than 1.5 billion euros worth of Russian and Belarusian birch plywood has been imported into the European Union through third countries, averaging 20 container loads per day. An additional 273 million euros were moved through China, Kazakhstan, Turkey, and Georgia between November 2024 and April 2025 using fraudulently issued certificates of origin.

“It is estimated that nearly one-fifth of all birch plywood currently on sale in Europe is illegal, so-called blood timber,” representatives of Earthsight's timber and sanctions division stated in January 2025. Seven of the ten largest Russian birch plywood exporters continue to supply Europe; two of them were linked to oligarchs who are closely connected to the Kremlin.

Earthsight warned Brussels that the European Union Deforestation Regulation (EUDR), by introducing a category of “unconditional low-risk” countries, could facilitate the laundering of illegal money and goods, while sanctions enforcement officials have pointed out that expanding sanctions would improve the situation.

Estimates and reality

As early as August 2024, researchers for the journal Forest Policy and Economics modelled the global forest products market with and without the war factor, concluding that industrial roundwood and finished timber prices would increase by about 3% in the short term, assuming the invasion ended in 2025. It is predicted that the Russian wood panel and paper markets will not fully recover for the next 30 years; other countries have already taken their place.

“Russia is one of the world's leading producers of forest products, so sanctions against it have a huge impact,” noted experts from North Carolina State University. China and other Asian producers will increase output volumes as long as prices remain high.

Factories across China purchased 10.66 million cubic metres of imported timber in the first half of 2026, which is 12% less than a year earlier; coniferous materials experienced the largest drop, at 20.2%. During the same period, shipments of Russian sawn timber to China fell by 21.8% to 4.46 million cubic metres.

The miraculous transformation of veneer

The Russian company Segezha Group, which sells 77% of its sawn timber directly to China, reported losses of 88 billion roubles in 2025 as its sales volumes in China fell by 9% to 2.1 million cubic metres. Timber processing parks at the borders, which the scientists mentioned in their work, now convert Russian veneer into a “Chinese product”; buyers on other continents receive it as goods of Chinese origin.

Scientists Chang, Liu, and Gao were “only” 80 million cubic metres off in their sawn timber trade forecast. The scientists did, however, correctly identify the only control mechanism that would have made the timber manufacturing plants at border stations traceable. Ironically, the certificate of origin, which was requested as early as 2020, has now become a “simple piece of paper” against the backdrop of which the illegal “laundering” of timber is being carried out...