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KRS Logistics
Funded by Euregio Karelia Neighbourhood Programme 2001-2006

Objective of the project

The intention of the project was to assess the technical and financial possibilities to bring Russian logs and roughly cut lumber using sea transport from Ääninen in Republic of Karelia to the Kalajoki harbour as raw material for the local mechanical wood refining industry. The project was based on the logistic supply chain model, which would begin in Russia, have refining in Russia and/or Finland, and delivery to customers in Finland and from Finland to third-party countries. The goal was to implement a pilot shipment using funding from the wood refining industry businesses in the area in order to determine the route; based on the results of the pilot shipment, trial shipments would be started and the necessary conditions for permanent wood product transport in the future would be created.

Main activities

• to create close and continuous connections between Oulu South and the Republic of Karelia • to promote co-operation between entities during the project as well as in post-project operations. • to produce a comparative report regarding pricing and the environmental impacts of different transport methods (ship, road and rail transport) when importing from the Republic of Karelia to Finland.


The project was implemented as three sub-studies. The first one studied the forestry companies in the Republic of Karelia, their operational capacity and their interest in the issue. Considerable forest resources were found to be located in the Republic of Karelia, Archangelsk and Vologda that are either not being utilised at all or are being used inefficiently. The areas were found to possess great potential for increasing forest cutting and transport volumes. With the increase in transport costs and the round timber export tariff increases, it was seen as necessary to research attracting investments as well as engaging in forest industry business operations in the associated areas in the future. The second research subject was sea logistics, which was found to be experiencing a steady increase in forest industry transports. There have been problems with Russian inland waterways due to insufficient funding; however, a holistic development plan has been created based on the problem and improvements are underway. The third study was regarding potential Finnish sawmills and their interest in importing raw material. The demand for raw materials at sawmills was found to be increasing, and imported timber has a levelling effect on capacity and cost fluctuation. The import of logs was found to be limited in the longer term and imports would be targeted mainly at roughly cut wood products and for creating sawmills in the local area. Finnish sawmill investments were increasing and it was estimated that they would continue to do so, although large Finnish companies were also acquiring wood cutting rights. Wood products did not have significant export tariffs nor were they expected in the near future. On paper the price differences were not very big for different modes of transport, but the practical challenges of different transport methods were seen to be equally important. Transport by sea was seen as the only viable solution for significant shipments.

Basic information


KRS Logistics


2005-06-01 - 2006-09-30

Total Budget / Programme funding

56 887 € / 39 804 €

Lead partner

Town of Kalajoki
Lead partner web-site


AO Karellesprom