Page 7 - bne monthly magazine October 2022

bne October 2022 Companies & Markets I 7
nowhere to export Belarus’ refined oil products due to the Western sanctions.
Shortly after this announcement, Belarusian Deputy Prime Minister Yuri Nazarov told state Belarusian media that “In view of restrictions, including those based on sanctions, we've optimised oil refining at two oil refineries of ours in order to meet needs of the domestic market.”
On August 30, an official from the state-owned Belarusneft company told state Belarusian media that Belarus was planning to extract 1.8mn tonnes of oil in 2022, an increase
of 70,000 tonnes from last year. According to the official, this was a part of the gradual increase in extraction volumes that had been going on for the past six years, which also “produces virtually no waste.”
One day later, Belarus reduced its export duties on oil and oil products in accordance with a resolution adopted by its Council of Ministers.
Belarus’ government looks for ways boost its domestic forestry market
bne IntelliNews
In spring this year, when the West’s sanctions regime against Belarus was heavily intensified due to Belarus’ participa- tion in Russia’s invasion of Ukraine, Belarusian strongman Alexander Lukashenko acted as if Western sanctions would barely affect Belarus. However, these sanctions are slowly but steadily having significant effects on all Belarusian industries and Belarus’ import-substitution response to the sanctions has caused a major restructuring of the domestic market.
The Baltic ports have for a long time been of significant importance to landlocked Belarus. Lithuania’s port of Klaipeda has handled significant amounts of Belarusian wood products. According to Belarus’ PM Roman Golovchenko, “Lithuanian wood processing plants perform further process- ing and export the final product to other countries in the EU.”
However, in 2022 EU countries have been prohibited from importing Belarusian wood products classified under HS chapter 44 (Wood and articles of wood; Wood charcoal) and the Forrest Stewardship Council (FSC) also chose to suspend all trading certificates for Belarus.
The resolution lowered the export duties on crude oil, furnace oil, oil bitumen, petroleum jelly, paraffin and waste oils to $52/tonne ($53), straight-run gasoline to $28.6/tonne ($29.1) and on commercial gasoline, diesel fuel, light and middle distillates, benzene, toluene, zylene and lubricants to $15.6/tonne ($15.9).
Considering the fact that Russia has more than enough of its own oil products, the halving of the Belarusian refineries' throughput and Yuri Nazarov’s statement in April, this decision is interesting.
It suggests that Belarus could be counting on finding a new market to offset its oil products (such as the Russian market) relatively soon and is therefore increasing production early while planning to start up its refineries later. It could also be the case that this output increase is merely for show, and the produced oil could be stored for a longer time, awaiting
a more favourable export climate.
www.forest.by
Instead of making its way through the Baltic ports, Belaru- sian Deputy Minister of Forest Management Vladimir Krech said back in March that Belarusian wood would be exported through China. In the same statement, he also admitted that
“In 2022 EU countries have been prohibited from importing Belarusian wood products classified under HS chapter 44”
this detour would decrease the profitability by 80%. The lack of an FSC certificate stopped Belarusian furniture from being exported to the EU market, but it also negatively affected Belarus exports to China since some Chinese producers also require the certificate.
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