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LVM Supervisory Board Approves the LVM Medium–term Operational Strategy

On 14 October, the Supervisory Board of JSC “Latvia's State Forests” (LVM) approved the company's medium–term operating strategy for the period until 2025. This is a medium–term planning document, which defines the basic directions of LVM development and the goals to be achieved, taking into account the public interest.

“Despite the fact that the medium–term strategy is based on the directions and goals included in the national–level planning documents approved last year, as well as the government's planned contribution of LVM dividends to the state budget, the biggest changes in the company's development are yet to come. They will be implemented by the European and national–level planning documents currently being developed, such as the European Green Course, the EU Biodiversity Strategy, as well as other planning documents for sectors of the national economy. The strategy also includes the most important indicators that LVM uses to plan and monitor the implementation of its strategic goals, measure achievements and continue to provide an open and comprehensible overview of its operations both inside and outside the company,” says Mārtiņš Gaigals, Head of LVM Supervisory Board Strategy Committee.

LVM anticipates that the decline in market demand for low–dimensional timber and the drop in prices resulting from the Covid–19 pandemic will continue next year. However, return to the previous level of market activity is forecast already in 2022. The projected increase in labour and energy costs will also create an additional challenge, therefore the strategy is intended not only to enhance LVM internal processes and labour productivity, but also to promote the work efficiency of service providers.

The implementation of LVM strategic economic goals, such as increasing long–term profits, raising the value of assets and stands managed and developing the production of high value–added products, is not possible without innovations; therefore, new tasks and goals have been formulated in this area as well. It is planned that during the period covered by the strategy the first positive results will be given by the investments made in the “Mežvidi” tree nursery: selling 3.2 million seedlings in 2022, 9.6 million seedlings in 2023, and reaching 15 million seedlings sold in 2026.

LVM medium–term strategy intends to continue the forest road development programme, by which the Supervisory Board aims not only to increase efficiency and accessibility, but also to reduce fire safety risks, including in specially protected nature territories. This is especially important in the long run, reducing fire risks caused by global climate change in the state forests entrusted to LVM for management.