The Far East Development Fund launches a pilot to monitor forest plots
Director General FEDF Alexei Chekunkov said in an interview for Kommersant that the Fund would create a digital platform for the timber industry to collect relevant data on the plots and hold auctions for investors. “When we first revised the national timberland, nobody seemed to know exactly how much standing crop we had, where it is located, the basic source of information being the forester’s paper-based mapboard. Meanwhile, only 3% of such maps were drawn earlier 10 years old ago, whereas 80% were over 20 years old, and ultimately, the discrepancies between the state forestry register and the unified state register of immovable property were equivalent to the territory of Kazakhstan, these data being classified to boot,” Mr. Chekunkov lamented.
In the meantime, any investor dealing with timberland encounters finds out that 13 different federal public agencies are in charge of this process and the plots are allocated at the regional level, which is not always transparent, adds the Head of the Fund.
A new map of the plots adjacent to motorways will presumably be drawn on the basis of satellite images with due regard for the fire hazard.
An open auction will be the only method to sell plots. If timber is to be processed, the investor will be eligible to a price-reduction factor. In addition, there are plans to launch a stock exchange for trading in timber that would get all transactions logged in, which will enhance the pricing transparency, especially in export operations.
The costs involved in launching the system may reach several billions. Data collection for one ha will cost around RUB 70 as compared to RUB 2,000 if done by the forester, as estimated by Mr. Chekunkov.
Why new technology is such a challenge for regions
A similar mechanism was applied to aquaculture zones, and during three years, three times as many plots have been allocated (60,000 ha in total) than in the previous 20 years, and average investments per one hectare amounted to RUB 1.5 mln. Meanwhile, the price of a water area has thrice increased due to auctions. Individual components of this system are already used in certain countries, such as Finland and Canada, but the problem of creating a unified database is not so acute there. “Federal and even regional authorities do realise that the old practices are unsustainable, since felling is carried out along major motorways, whereas extending these roads to the new plots would require massive investment”, Chekunkov concludes.