Romsilva was overzealous in setting the starting price of auctions for timber, Competition Council head says

The President of the Competition Council, Bogdan Chiriţoiu, said on Wednesday, while in Miercurea Ciuc (central Romania), referring to the issues raised at the auctions on the use of wood, that this is an exaggerated crisis and that he recommended Romsilva to start auctions from the minimum price in the previous year and not from the average price, accusing the institution of misinterpretation of the law.
Bogdan Chiriţoiu explained that a preliminary analysis conducted last year by the Competition Council on the timber industry recommended Romsilva to conduct auctions and not to carry on direct negotiations when selling wood, without competition, so that the state gets a good price, and this principle was taken into the Government Decision on the use of timber.
According to the President of the Competition Council, Romsilva was overzealous in interpreting the Government’s provisions and set the starting price at auctions as the average year price of the previous year.
“The government decision says the sale should be done under market conditions. The market does not go up forever, the market may go up and down, look at the price of oil. So there is no law of nature saying prices should go up forever,” said Bogdan Chiriţoiu.
He stressed he understands the industry’s protests and the operators complaints that the price goes up continuously and has recommended Romsilva to start the auctions from the last year’s minimum price.
Chiritoiu underlined that the institution he leads is still examining the situation and it has levers to intervene if Romsilva takes advantage of its important position on the market, as well as if evidence of agreements between firms buying wood surface.

Several thousands forest workers from Suceava County and from other counties, along with forest owners and furniture producers staged a protest rally on Sunday downtown Bucharest, in Piata Victoriei, in front of the Government. They were dissatisfied with the new prices of wood, with the recovery mode, but also with the procedure of auction by envelope.
The main dissatisfactions are related to the state company Romsilva, which they claim it has blocked the entire industry due to its excessive prices. The ones in need for wood now prefer to buy from the black market, rather than from Romsilva, leading thus to the tripling of wood prices, while more forest owners prefer to illegally cut the forests.
“We demand the return to normality in the prices of wood, at the prices before 2016 and contracts of sale that represent a partnership, not to contain unfair terms and obligations for wood purchasers,” said Ciprian Musca, leader of the Suceava Foresters Association.
The protesters submitted to the government a list including ten demands, most of them related to Romsilva, but also related to the need for a much tougher law aimed to halt the illegal logging.