Month: May 2025
Since March, SFE “Forests of Ukraine” has had a renewed procurement team. It is led by Mykhailo Stayetskyi, who joined the enterprise from “Ukrposhta”, where one of the most successful procurement functions among large state-owned companies was built.
The goal of the new team is to enhance the efficiency and transparency of procurement at SFE “Forests of Ukraine”, optimize company expenditures, and ensure the implementation of the investment program and key initiatives.
We will discuss the results at the end of the year. However, several important changes have already been initiated in the work of the Procurement Department.
1.Implementation of Category Management
Prozorro does not automatically guarantee the best offer in announced tenders. High-quality tender preparation is required, based on in-depth analysis of each product or service category. Category managers within the Procurement Department analyze and align the enterprise’s internal needs with the external market conditions under which those needs can be met. To this end, they conduct pre-tender market consultations with manufacturers, importers, official dealers, and major players in goods and services markets. They develop procurement terms that make it possible to attract a wider range of bidders, ensuring timely and high-quality fulfillment of the enterprise’s needs at an optimal price and without additional risks. To ensure open and transparent communication with suppliers, work is being carried out on the website of SFE “Forests of Ukraine”.
The updated procurement page contains essential and practical information that suppliers need to participate in tenders. It will also feature announcements of open meetings and consultations with potential participants in the most complex and non-standard procurements, where their external supplier expertise will help define the final tender conditions.
2.Analysis of Performance Indicators
The data structure within the electronic procurement system has been modified at the enterprise level, creating analytical capabilities to assess procurement performance, both centrally and at the level of each Regional Office individually. The Department focuses on cost savings, the level of competition in bidding, their success rate, and the absence of complaints or violations. A dedicated role has been introduced for internal monitoring of Regional Office procurements, providing them with practical and methodological support to improve efficiency. This will enable faster identification of weak points, the implementation of unified approaches to tender documentation development, and the application of best practices for preventing violations of public procurement legislation.
3.Internal Ranking
A framework and criteria are being developed for the internal ranking of procurement specialists in Regional Offices. This will help motivate the strongest performers and support the growth and development of those striving to catch up with the leaders. This approach proved highly effective at “Ukrposhta”, leading to the centralization of the procurement team, which consistently demonstrated excellent results year after year (ranking 2nd in the 2024 Procurer Index).
Mykhailo Stayetskyi is confident that the procurement team at SFE “Forests of Ukraine” is on track for equally strong results.
Most formerly certified branches, now restructured as forestry management units, have successfully renewed their FSC certificates. In both the Poliskyi and Podilskyi Forest Offices, 100% of the certificates have been updated.
In some regions, there is not only renewal, but also an expansion of certified forest management areas.
In forestry management units that now include previously non-certified forest plots, the certification audit process is ongoing. Successful completion of these audits will, in the near future, enable an increase in the total area of FSC-certified forests in Ukraine.
As a result of active hostilities, large areas of forest in Ukraine have been contaminated with explosive ordnance (EO), creating a serious obstacle to forest management activities and the FSC certification process. This issue is especially relevant for the Branch “Pivnichnyi Forest Office”, where work is underway in the Chernihiv and Sumy regions to identify the boundaries of forest areas contaminated with EO. The presence of such areas is one of the key factors considered when making certification decisions for forestry enterprises.
Despite these challenges, SFE “Forests of Ukraine” continues to ensure the uninterrupted supply of certified timber products. Wood-processing enterprises, particularly those focused on export, have the opportunity to purchase certified timber in most resource-rich regions of the country. This supports the export potential of the wood-processing industry and reaffirms SFE “Forests of Ukraine” commitment to the principles of sustainable forest management, even under wartime conditions.
“We are completing the spring reforestation campaign. Priority is being given to restoring areas affected by hostilities. Today, in Kyiv region, near Ivankiv, at the Fenevytske forestry unit, memorial forests were planted.
The event was held in cooperation with Svitlana Hrynchuk, Minister of Environmental Protection and Natural Resources of Ukraine, Natalka Cmoc, Ambassador of Canada to Ukraine, Olha Vasylevska-Smahliuk, Member of Parliament, and Anna Krysiuk, founder of the Greening of the Planet initiative.
The Ivankivske forestry management unit is one of those that endured occupation during the spring of 2022. All forestry units in the area were occupied; most forest compartments came under shelling, and part of the forest was burned due to missile and artillery strikes. A large number of forestry workers remained on site, supporting the Defense Forces of Ukraine, participating in demining efforts, and helping to restore infrastructure. For more than two years, work has been ongoing to clear, prepare, and return to full operational capacity.
Previously, this area was a pure pine stand, heavily contaminated with remnants of Russian munitions, it burned by 60% as a result. Today, we have planted a mixed forest of pine and oak. All seedlings have a closed root system and a survival rate of over 95%. Foresters will also enrich the site by planting viburnum.
Resilient mixed forests will help reduce the risk of large-scale wildfires in the future, as such fires often begin in dry coniferous stands.
SFE “Forests of Ukraine” continues to plant memorial forests — in honor of Ukrainian heroes who fought for our freedom and independence. Of the 45 Forests of Memory created since the beginning of our initiative, a quarter were planted this spring. As a result, this year’s spring reforestation campaign set a record for the number of memorial forests planted,” said Yurii Bolokhovets.
At the beginning of May, the next round of exchange auctions will begin for the conclusion of forward contracts for the second half of 2025.
As a reminder, SFE “Forests of Ukraine” first introduced the practice of six-month fixed-price contracts at the end of last year. At that time, for deliveries in the first half of 2025, the enterprise’s branches offered 416,000 m³ of timber, of which 351,000 m³ were sold (including 168,000 m³ of roundwood and 156,000 m³ of industrial fuelwood).
The experiment proved successful. As of the end of April, 64% of the roundwood volume and 73% of the industrial fuelwood volume had been delivered to buyers, which is fully in line with the delivery schedule.
Long-term contracts contribute to effective planning and the development of production activities, both for processing enterprises and for SFE “Forests of Ukraine.” Thus, positive result is our shared achievement and opens the door to scaling up this new practice.
As previously announced by SFE “Forests of Ukraine,” the volume of timber allocated for forward contracts with delivery in the second half of 2025 has been increased to 30% of the enterprise’s planned harvest.
In total, 1.56 million m³ of timber have been offered at the semi-annual auctions (including 624.4 thousand m³ of roundwood and 928.4 thousand m³ of fuelwood). This is nearly four times more than was offered last year.
Another important update. Based on suggestions from market participants, the method for determining starting prices for timber products has been improved.
Firstly, starting prices are now calculated based on actual transaction prices (excluding speculative purchases that did not result in actual deliveries).
Secondly, the reference period used to calculate starting prices has been extended, which helps to smooth out temporary price spikes.
Therefore, for the Q3 2025 auctions and forward contracts for the second half of 2025, starting prices are based on three indicators: actual transaction prices from Q4 2024 and Q1 2025, as well as the starting prices from Q2 2025 auctions (for identical assortments with the corresponding delivery basis).
Thus, the enterprise has created the conditions for price stabilization in the timber market; however, auction results will ultimately depend on demand. As always, prices will be determined solely by buyers.
SFE “Forests of Ukraine” remains open to dialogue with market participants regarding further improvement of the timber sales system.