Russian timber getting into Australia by exploiting loopholes, industry says

Australia's timber industry is raising concerns that Russian wood is circumventing sanctions by entering the country through loopholes. Since April 2022, tariffs have been in place on Russian and Belarusian timber following Russia's invasion of Ukraine.

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If a product is manufactured in another country or substantially transformed, it avoids that tariff. Russian timber can go to China, be manufactured into LVL (laminated veneer lumber) and come to Australia and not attract the tariff, and we think that is wrong.

According to the Australian Forest Products Association (AFPA), Russian timber is being rerouted through third countries such as China and Lithuania. Once processed or "substantially transformed" in these nations, it can be imported into Australia without attracting the existing tariffs. "If a product is manufactured in another country or substantially transformed, it avoids that tariff," said acting CEO Richard Hyett, adding, "we think that is wrong."

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We don't think Australians want to fund the war in Ukraine and we don't think Australians want Russian timber in their houses.

The AFPA estimates that approximately 100,000 cubic meters of timber containing Russian wood enters Australia each year, falsely labeled as exports from other countries. This influx is reportedly out-competing local producers who are struggling with a depressed market. "Our mill yards are full, ready to supply the Australian market, but they're being out-competed by cheap product coming from Russia through to China [and] into Australia," Hyett stated.

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Our mill yards are full, ready to supply the Australian market, but they're being out-competed by cheap product coming from Russia through to China [and] into Australia.

A spokesperson for the Department of Foreign Affairs and Trade affirmed Australia's commitment to supporting Ukraine and imposing costs on Russia, noting the existing 35 percent tariff on timber of Russian origin and over 1,800 sanctions. They emphasized that Australia takes tariff compliance seriously and expects importers to conduct due diligence on their supply chains. Concerns about the legality of Russia's timber trade, including illegal logging, predate the Ukraine invasion, with organizations like the Forest Stewardship Council no longer certifying Russian timber.

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Australia has imposed a 35 per cent tariff on the import of goods from Russia and Belarus that applies to timber of Russian origin. Australia has also imposed more than 1,800 sanctions on Russia and its supporters.