Vladimir Putin, president of Russia said at the press conference on February 1 that Russia's raw materials should be processed in the territory of Russia and the Russian government has formulated the related measures.

Russia's biggest resources cooperative partner is China. According to the statistics, the domestic timber output had been severely insufficient since China conducted the natural forest resource protection project in 2000. The raw wood China imported from Russia accounted for 64.6% of the total in 2004 and 42% of Russia's raw wood exports entered China in 2005.

According to Russia's latest revised Forest Law, Russia will increase the current raw wood export tariff to 10% which is no less than EUR 6 per cubic meter, effective in January, 2007. Afterwards the tariff will increase by 30% every year and be no less than EUR 24 by 2010, which means that the cost will significantly go up if the timber is only imported from Russia.

According to the survey of the forest resources nationwide released by the National Bureau of Forestry in 2005, the gap between the supply and demand of the Chinese timber is basically 140 – 150 million cubic meters. The gap will expand to about 200 million cubic meters in 2015. The gap is filled mainly through the import.

In recent years the price for the timber from Russia and the other countries has been continuously rising. In the second half of 2006 the Ministry of Finance further lowered the export tax refund rate of partial timber processing products. China's timber processing enterprises were faced with the pressure from the both sides.