STOCKHOLM, Jan 26 (Reuters) – (This Jan. 26 story has been up to date to right the title of the subsidiary to Ingka (not IKEA) Investments in paragraph 13.)
IKEA is utilizing extra wooden from Sweden and the Baltics to make up for not sourcing it from Russia and Belarus which the corporate has shunned resulting from Moscow’s warfare in Ukraine, its wooden provide boss stated in an interview.
The world’s greatest furnishings model – one of many world’s prime wooden customers – used 20 million cubic metres of wooden in its merchandise, packaging and communication materials within the 12 months via August 2022.
“We have now managed to exchange these (Russia and Belarus) volumes in different nations on a extremely popular wooden market,” Ulf Johansson, International Wooden Provide and Forestry Supervisor at model proprietor Inter IKEA, informed Reuters.
Sweden, the Baltics, Poland and Germany are amongst nations the place IKEA’s wooden sourcing has elevated on account of the warfare in Ukraine, he stated, including that among the options is perhaps long-term and others short-term.
Russia and Belarus have been IKEA’s fifth and sixth greatest wooden suppliers earlier than the warfare, accounting for six% and 5% respectively of its provides, the corporate’s web site stated.
The corporate on Thursday launched a map on its web site exhibiting the origin of all its wooden to fulfill prospects’ calls for for extra transparency.
Poland, adopted by Lithuania and Sweden have been the three greatest suppliers within the 12 months via August 2022.
IKEA says it makes use of solely Forest Stewardship Council (FSC) licensed or recycled wooden. It banned suppliers from utilizing Russian and Belarusian wooden after FSC suspended its certification within the two nations as a result of invasion.
IKEA shops in Russia have been closed since March, whereas IKEA owned buying malls stay open. Inter IKEA’s 4 factories within the nation are closed and up on the market.
Johansson stated IKEA is now the midst of a evaluate of its long-term wooden provide technique, by way of options to Russia but additionally in mild of growth plans for South America the place it opened its first retailer in 2022.
“Now it additionally appears to be like just like the uncooked materials market goes down a bit so it’s perhaps a bit of simpler scenario proper now,” he stated.
Wooden costs are easing after surging up to now few years, partly in response to elevated demand for packaging through the pandemic as folks shopped on-line.
IKEA has in recent times been shopping for and managing forests in quite a lot of nations via its funding automobile Ingka Investments, from which it would use wooden and wooden merchandise sooner or later.
Whereas IKEA says managing forests responsibly will assist mitigate local weather change, it doesn’t but embrace that enterprise in its total goal to be local weather optimistic by 2030 resulting from difficulties measuring carbon seize and storage.
Reporting by Anna Ringstrom and Marie Mannes; Modifying by Jane Merriman and Kevin Liffey
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