Month: April 2025
Due to the full-scale war, the vehicle fleet of SFE “Forests of Ukraine” has sustained significant losses. Since the beginning of hostilities, forestry workers have transferred more than 1,000 units of equipment to support the front, including hundreds of passenger vehicles. This has further exacerbated the shortage of transport in the forestry sector.
Just a year ago, due to the transfer by SFE “Forests of Ukraine” of equipment to the front lines and the aging of the fleet (over 50% of the vehicles were outdated), there was, on average, less than one vehicle per forestry unit. Some forestry units were left without a single operational vehicle.
In 2024, SFE “Forests of Ukraine” launched a large-scale vehicle renewal program. So far this year, 250 vehicles have already been purchased, reducing the number of forestry units without transport by half. Today, on average, one vehicle covers 2,500 hectares of forest.
However, the need for vehicles remains high, especially in frontline regions, including the forestry enterprises of Kharkiv region, which recently became part of SFE “Forests of Ukraine”. To support their operations, 6 off-road vehicles equipped with firefighting equipment have already been transferred from branches of the company in other regions.
Soon, Slovianskе, Lymanske, Velykoanadolske, Oleshkivske, and Velykokopanivske forestry enterprises will also join SFE “Forests of Ukraine”. They too require modern equipment for forest protection and maintenance.
As part of its investment plan, the company intends to purchase another 179 vehicles in 2025, including:
49 all-wheel-drive pickup trucks, half of which will be equipped with firefighting modules with a 0.5 m³ capacity;
130 high-clearance utility vehicles for patrolling, combating illegal logging, responding to fires, and performing operational tasks.
Procurement is conducted via the Prozorro electronic platform. The vehicle packages will include:
a winter set of tires,
special trunk-mounted equipment,
metal engine protection,
standard road safety kits and accessories.
Last year, recreational areas managed by “Forests of Ukraine” were visited by over 3 million Ukrainians. Thousands of hectares of forest were preserved from potential wildfires thanks to the creation of comfortable, safe, and free places for public recreation.
This year, the recreational development program continues. Since 2023, the enterprise has established more than 100 modern “Lisovychok” sites. In 2025, an additional 50 will be created.
The new recreational sites are fully equipped leisure complexes with developed infrastructure (including children’s and sports playgrounds, water supply, electricity, restrooms, barbecue areas, and more). In most cases, eco-trails are also created nearby, passing through scenic natural locations.
Most of the new sites will be established in the Polissia region and the northern areas, where coniferous stands especially vulnerable to wildfires are predominant.
How do we choose locations for “Lisovychok” sites?
1.Intercepting tourist flows
Recreational sites are placed in areas with the highest concentration of visitors, most often near highways and populated areas. For example, this year a new site was opened along the H-31 highway (Dnipro–Reshetylivka), near the village of Obukhivka. During the Easter holidays, it was completely full.
2.Preventing illegal dumping
Litter left behind after picnics posed a risk of forming an illegal dumping site in the forest along the banks of the Psel River in Sumy. To stop this, a new recreational site is being built there.
3.Ensuring visitor safety from landmine hazards
In Kyiv, Chernihiv, Sumy, Kharkiv regions and others, thousands of hectares of forest are contaminated with explosive ordnance. Dangerous areas are often located near populated places and pose a serious threat to people. One of our new recreational sites is being established near Irpin, where intense fighting took place in 2022.
4.Educational and cultural activities in partnership with communities
The development of the recreational network is part of the enterprise’s cooperation with local communities. One of the districts of the city of Kamianske borders the forest areas of the Pankivske forestry management unit. The local community approached us with a proposal to establish a recreational site here, including sports grounds for football, basketball, and other activities.
During recent meetings with the business community, one of the key demands was to increase harvesting volumes due to a severe shortage of available timber resources.
However, the facts tell a different story. Since the beginning of April, the SFE “Forests of Ukraine” hotline has not received a single complaint regarding failure to fulfill timber supply contracts due to the fault of forestry enterprises (the only case involves a conflict between private businesses in the Carpathian region, where our employees became hostages to the situation). Nevertheless, the volume of uncollected timber at storage sites has increased noticeably.
Outstanding payments from businesses for already delivered products have also increased — now totaling up to UAH 500 million.
Among those failing to meet their obligations are companies ranked in the industry’s top 10.
Currently, business liability for breaching contracts is minimal. Buyers face virtually no risks. When there are significant price fluctuations on the market, it is sometimes easier for buyers to leave a contract unfulfilled and re-enter the auction instead.
SFE “Forests of Ukraine” harvests timber specifically under signed contracts. Therefore, delays caused by repeated auctions carry the risk of timber quality deterioration especially during the warmer months. The accumulation of timber products and overloading of storage facilities lead to increased warehousing costs. Delayed payments negatively affect settlements with service providers (primarily logging contractors). A forced halt disrupts the work of harvesting crews, resulting in the loss of scarce personnel who are difficult to replace.
Our company is actively working to address the issue. We are increasing the share of long-term contracts. The situation will undoubtedly stabilize. However, the issue of business responsibility must be taken into account in future discussions on increasing harvesting volumes. If we demand — we must also be accountable.
In the past week, 31 forest fires occurred across the territory of SFE “Forests of Ukraine”, affecting a total area of 78.4 hectares.
The main cause is human activity. The weather has been exceptionally warm and dry. Many people are spending time in the forests. Despite the ban, some continue to light campfires. There have also been cases of arson involving dry grass and waste.
A military factor also played a role: in the Kyiv region, despite Putin’s so-called “ceasefire,” a fire was caused by a drone crash.
All outbreaks were promptly extinguished. A total of 163 forest protection personnel were involved in the firefighting efforts, along with 23 fire trucks and 15 tractors used either to transport water tanks or to create firebreaks.
A particularly difficult situation occurred in the Balakliia forestry unit in the Kharkiv region, where a forest fire spread across more than 340 hectares. The scale of the fire is explained by the presence of landmines in the forested area. The fire spread into the mined forest from nearby meadows that had been set on fire by local residents. The fire has now been contained through joint efforts of the forest protection service and the State Emergency Service of Ukraine. Full extinguishment is still underway. Unfortunately, during the fire suppression efforts, one of the fire trucks hit an explosive device, with two of our employees on board.
We are announcing a tender for the implementation of an Enterprise Resource Planning (ERP) system.
Procurement and sales, production, HR, investments, legal and land management, planning and budgeting, accounting and taxation, document flow — absolutely all enterprise processes will be unified, digitized, and integrated into a single management system.
Why is this important?
SFE “Forests of Ukraine” includes more than 1,500 forestry units, 9 regional branches, and 22,000 employees. The company manages nearly 7 million hectares of forest fund lands and operates 250,000 fixed assets, including machinery, equipment, and other production tools.
Over 15 million documents are generated annually across the enterprise!
At the same time, the forest enterprises that became part of “Forests of Ukraine” have never had a unified system for data accounting, exchange, and standardization.
The largest Ukrainian state-owned companies (“Ukrposhta”, “Ukrnafta”, and “Ukrzaliznytsia”) are already using ERP systems. In the forestry sector, such a system is being developed for the first time.
Expected economic effect
The system is extremely large-scale (over 5,000 users and dozens of business processes) and requires significant investment in its development.
However, experience shows that in the very first year of operation, an ERP system optimizes company expenses by 2–5% of turnover. In the case of SFE “Forests of Ukraine”, this amounts to at least UAH 500 million!
The funds invested in development and implementation will pay off within the first year of operation. In the future, the company will only continue to save.
ERP and company development
The implementation of an ERP system is recommended by the Accounting Chamber. Among other benefits, the automated system will support the company’s transition to International Financial Reporting Standards (IFRS).
ERP is also key to implementing investment projects — such as mechanized harvesting, the production of seedlings with a closed root system, and more.
Benefits for the state and society
All internal processes within the company will become more transparent. It will be significantly easier for oversight bodies to conduct audits and identify violations of the law. Hiding any misconduct will be virtually impossible.
Benefits for consumers
Through a personal online account, market participants will be able to track the execution of timber supply contracts and access any other relevant information. Data collected by the system regarding the origin of timber will ensure compliance with the requirements of the EU Deforestation Regulation (EUDR).
Implementation Timeline
The project is planned for a three-year period. The contractor will be required to develop a system concept that meets all the requirements of SFE “Forests of Ukraine,” model business processes, deliver and implement the system, and provide its support and updates throughout the duration of the contract. In addition, the contractor must conduct staff training and pilot testing in several branches, followed by scaling the system across the company’s other units.
“The so-called Peasants’ forest’ in the Rivne region — 10,000 hectares of former state forestry lands that had long remained ownerless.
What was once a real forest now resembles a scorched wasteland. Nearly 500,000 stumps were recorded during the inventory process.”
The estimated damage from illegal logging amounts to UAH 3.4 billion — nearly equivalent to the annual budget of the city of Rivne. This reckless logging continued for years and, unlike in state-run forestry enterprises, somehow remained unnoticed by biodiversity advocates.
Thanks to the firm position of Oleksandr Koval, Head of the Rivne Regional Military Administration, the territory was transferred to the Rafalivka forestry management unit of SFE “Forests of Ukraine.” This spring, we are launching a restoration program for the Peasants’ forest.
Investments in forest restoration, protection, safeguarding, and maintenance over the next five years will total nearly UAH 20 million.
These investments are funded entirely by SFE “Forests of Ukraine.” Thanks to the centralization of forest sector management, we now have the capacity to make such contributions. Financial support from the enterprise is provided not only to subsidized regions in the South and East, but also to resource-rich areas such as the Rivne region.
The restoration of the Peasants’ forest will begin using modern technologies and container-grown seedlings. Instead of fire-prone, pest-sensitive, and climate-vulnerable pure conifer stands, mixed and more resilient forests will be established in the Rivne region, combining both coniferous and deciduous tree species.
We are also continuing the forest restoration program in the Polissia region following the “amber fever” of 2015–2017. A total of 4,200 hectares of forest were damaged as a result of illegal amber mining.
Currently, part of these areas has been allocated for legal mining. These lands belong to local communities. SFE “Forests of Ukraine” is engaged as a contractor responsible for reforestation on the reclaimed sites. But we are interested in ensuring that the newly planted forests are properly maintained and protected. That is why we are appealing to local communities to voluntarily transfer these areas to the State Forest Fund, which would guarantee their long-term preservation,” said Yurii Bolokhovets.
Over the past month, numerous meetings have been held with representatives of the wood processing industry. The main topic of discussion was resource supply.
SFE “Forests of Ukraine” emphasized that comparing current harvesting volumes with pre-war levels is not appropriate.
One of the key factors currently limiting harvesting is the presence of landmines in the forests.
The area of mined forests within the territory managed by SFE “Forests of Ukraine” alone (not including forestry enterprises in the Donetsk and Kherson regions, which have not yet been integrated into our structure) reaches 310,000 hectares.
Timber harvesting is significantly restricted in the Zhytomyr, Kyiv, Chernihiv, Sumy, and Kharkiv regions. The Iziumske Forestry Management Unit in the Kharkiv region alone has approximately 140,000 hectares of mined land.
We asked our regional branches to calculate their annual losses.
The greatest loss is reported by the resource-rich Branch “Stolychnyi Forest Office” — 920,000 m³ of commercial timber per year. This amounts to approximately UAH 3.3 billion!
At Branch “Pivnichnyi Forest Office”, more than 92,000 hectares remain inaccessible, including 22,000 hectares of mined land. As a result, the branch is unable to supply 330,000 m³ of timber products, leading to annual losses of UAH 965 million.
At Branch “Slobozhanskyi Forest Office”, 142,000 hectares of forest are mined. Each year, local foresters are unable to harvest 350,000 m³ of timber, resulting in losses of UAH 600 million.
In total, the enterprise loses 1.6 million m³ of timber annually, which amounts to nearly UAH 5 billion, part of which could have been allocated to taxes and fees.
If you add these losses to the current harvesting volume, you get almost the same amount that forestry enterprises under the State Forest Resources Agency of Ukraine harvested before the war.