Ikea's wholly-owned subsidiary Swedwood (now called Ikea Industry) reported that it has ceased its logging operations in the last remaining old-growth forests of the northern Russian region of Karelia to move them in the Tikhvin region. Karelia is home to one of Europe's last old-growth forests and Swedwood had logging operations on 700,000 acres in the region, provided it avoids old trees and does not clear steep slopes, which erode without tree cover.
Swedwood had been clear-cutting century-old trees in the boreal forests with heavy machinery for many years. Swedish enviromentalists criticized Swedwood's for using heavy machinery to harvest vast intact forest areas with centuries-old trees and extraordinary biodiversity, transforming the land into uniform commercial forests. Ikea's profit from the timber is bought with massive damage to forest ecosystems and soils.
Swedwood stated that business reasons were behind this decision, but in January 2014, the company Karelia’s certificate had been suspended, due to logging of key biotopes, insufficient dialogue, lack of environmental consideration and work environment issues. Soon after the announcement of the certificate's suspension, IKEA announced that it will shut down its operations in Karelia during 2014. According to a recent Swedwood press release, the Ikea subsidiary will be focusing on wood production in Tikhvin and is shutting down its operations in Karelia. The company states that business reasons were behind this decision.