EBA experts raised key issues in timber exchange trading

11/ 09/ 2025

At a meeting on 5 September, organised by the Federation of Employers of Ukraine together with Members of Parliament, companies of the European Business Association highlighted a number of problematic issues negatively affecting the effectiveness of timber exchange trading. Experts noted that the country is currently facing a severe shortage of timber for processing, while logging volumes have fallen drastically compared to previous years. This has resulted in exceptionally high auction prices, making it virtually impossible for woodworking enterprises to purchase the necessary volumes of timber at prices aligned with global market trends. During the meeting, businesses compiled a list of concerns and possible solutions, in particular: Increase logging volumes. This would help stabilise prices and ensure Ukrainian woodworking enterprises have access to sufficient raw materials. Introduce transparency in exchange trading. Publication of timber sale contracts and information about participants would help prevent abuses by unscrupulous market players. Strengthen penalties for violations of exchange trading rules. Effective fines should be imposed on buyers who systematically fail to redeem contracted timber. Implement a robust bank guarantee mechanism for security deposits. This would simplify participation for bona fide processors. Introduce a graduated security deposit system depending on the lot size and delivery period, as processors are willing to provide higher guarantees to prevent manipulation in large-lot trading. Require forest users to approve and publish procedures for setting starting prices at auctions. This would serve as a transparent tool for exchange trading. The EBA is grateful to the organisers for addressing issues vital to the woodworking sector and hopes that the concerns raised will receive due attention.

Experts noted that the country is currently facing a severe shortage of timber for processing, while logging volumes have fallen drastically compared to previous years. This has resulted in exceptionally high auction prices, making it virtually impossible for woodworking enterprises to purchase the necessary volumes of timber at prices aligned with global market trends.

During the meeting, businesses compiled a list of concerns and possible solutions, in particular:

Increase logging volumes. This would help stabilise prices and ensure Ukrainian woodworking enterprises have access to sufficient raw materials.
Introduce transparency in exchange trading. Publication of timber sale contracts and information about participants would help prevent abuses by unscrupulous market players.
Strengthen penalties for violations of exchange trading rules. Effective fines should be imposed on buyers who systematically fail to redeem contracted timber.
Implement a robust bank guarantee mechanism for security deposits. This would simplify participation for bona fide processors.
Introduce a graduated security deposit system depending on the lot size and delivery period, as processors are willing to provide higher guarantees to prevent manipulation in large-lot trading.
Require forest users to approve and publish procedures for setting starting prices at auctions. This would serve as a transparent tool for exchange trading.

The EBA is grateful to the organisers for addressing issues vital to the woodworking sector and hopes that the concerns raised will receive due attention.