IKEA’s Purchase Forests in Romania
- New Europe Investor
- August 18, 2015
Swedish furniture retailer, IKEA has purchased 33,600 hectares (83,000 acres) of forestry in Romania.
Whilst IKEA has purchased approximately 4,000 hectares (10,000 acres) in the Baltics, the move of this size is the first of its kind. It has given the company access to a supply of raw materials and also a chance to diversify the company’s assets. It will also enable IKEA to stabilise the price of timber at a time when its cost is on the rise globally.
The Swedish company intends to manage the forestry itself and wishes to use it as an “an example of sustainable management of forests.”
The forests purchased in Romania are located in Central and North Eastern Romania. However, IKEA has not disclosed the price of the acquisition, nor the identity of the sellers.
It is reported that the company is looking to purchase forestry in a variety of other regions also.
Currently IKEA purchases wood from Scandinavia, Poland, Romania, China, and Russia. However, many of these sources have begun to experience sustainability problems in recent years.
In 2012, the company said it intended to double its sales from $55 billion by 2020, but by only increasing the volume of wood usage by 50%. This they intend to carry out by making more efficient use of wood and optimising product design further.