4.
INDONESIA
Export prospects good says minister
Coordinating Minister for Economic Affairs, Airlangga
Hartarto has indicated that the value of exports is forecast
to grow by just over 12% in 2023.
While this is lower than in 2022 when export growth
reached almost 30% Hartarto said that the projection takes
into account the risk of declining global demand and
assumes greater exports of added value products.
According to Hartarto, imports are projected to increase by
around 15% in 2023 after growing 29% in 2022.
See:
https://en.antaranews.com/news/269139/export-value-togrow-128-in-2023-minister-projects
Investors in downstream sectors welcomed
At the Indonesian Pavilion during the World Economic
Forum the Minister of Investment and Head of the
Investment Coordinating Board (BKPM), Bahlil
Lahadalia, invited global investors to join in the
development of Indonesia's downstream industry growth.
The Minister reiterated Indonesia's determination to focus
on adding value to its production from its own
commodities. He added that Indonesia's downstreaming
strategy would not focus only on minerals as Indonesia has
set eight priority sectors: minerals, coal, oil, gas,
agriculture, maritime, fishery and forestry for expansion of
downstream processing.
See:
https://www.medcom.id/english/business/JKRPBjObindonesia-invites-global-investors-in-downstreamingdevelopment-minister
Forestry contribution Treasury
The Ministry of Environment and Forestry (KLHK) has
reported that the forestry sector contributed Rp6.38 trillion
in non-tax revenue (PNBP) to the state treasury in 2022.
Non-tax revenue, according to the Minister, includes
payments from natural resources in the forestry sector in
the form of forest resources fees, reforestation funds and
fees for business permits for forest utilisation to the tune
of Rp2.93 trillion.
In related news, Siti Nurbaya Bakar, the Minister for
Forestry said the social forestry policy has had a profound
impact on community economies adding the "the
economic transaction value of the social forestry
programme reached Rp118.69 billion in 2022,".
According to the minister, social forestry has had a
positive impact on the economy as it has boosted incomes.
See:
https://en.antaranews.com/news/269877/impact-of-socialforestry-on-peoples-economy-profound-ministry
and
https://forestinsights.id/2023/01/18/klhk-setor-pnpb-rp638-ttahun-2022-simak-rincian-kontribusi-dari-pengusahaan-hutan/
Strengthening nature based businesses
The state-owned forestry company, Perhutani, has
revealed it intends to expand its core businesses to
biomass and nature based solutions this year. Rachman
Ferry Isfianto, Assistant Deputy for Plantation and
Forestry Industries at the Ministry of State-Owned
Enterprises (SOEs) said that Perhutani has a strong
business foundation and can survive difficult situations.
Perhutani President Director, Wahyu Kuncoro, conveyed
his gratitude for the contribution of all parties in Perhutani
throughout 2022 and expressed optimism for
achievements of the company in 2023.
See:
https://www.liputan6.com/bisnis/read/5179784/perhutaniperkuat-bisnis-biomassa-pada-2023
US$100 million climate change and biodiversity fund
Indonesia has received US$103.65 million in funding for
programmes on biodiversity, climate change and land
degradation recovery from the multilateral environmental
fund Global Environment Facility.
In related news, the KLHK is developing bio-prospecting
as one of the activities to encourage conservation activities
as a source of income. Director for Conservation of
Species and Genetics Biodiversity at the KLHK, Indra
Exploitasia Semiawan, said “in order to improve people’s
welfare want to change the paradigm that conservation
always involves expenditure but no financial income and
that conservation can also be a profit-centered”.
The Director said bioprospecting is a way to investigate
biological and genetic resources to create commercial
products and a strategy for bio-prospecting has been
included in the National Medium-Term Development
Plan.
See:https://en.antaranews.com/news/269193/ministry-pushesbioprospecting-to-change-perception-on-conservation
5.
MYANMAR
Illegal logging in Bago Yoma
The domestic media (BETV Business Online Media) has
quoted a Director in the Forest Department as saying in
the first nine months of the 2022-23 financial year the
highest rate of illegal logging was recorded in Bago
Yoma.
In the period April to December 2022, 6,660 tons of illegal
timber was confiscated in the entire country and over
2,800 tons of that was in Bago Yoma. Teak logs accounted
for 3,332 ton.
Bago Yoma is known as ‘Home of Teak’ but most illegal
logging has been occurring there despite the 10-year
logging moratorium.
In 2016 a nation-wide one year logging moratorium was
announced along with a 10-year moratorium (2016-2025)
for Bago Yoma where the heavy logging was recorded
between 2000-2015. As a result of the logging ban since
2016 the forest health has stated to recover.
See: https://www.facebook.com/watch/?extid=NS-UNK-UNKUNK-IOS_GK0TGK1C&
mibextid=2Rb1fB&v=1223138364945545 )
MTE 2022 teak log tenders
According to the Myanma Timber Enterprise (MTE) about
8,500 tons of teak logs were put up for tender in 2022. The
grading of teak logs was generally Sawing Grade (SG) 4,
5, 6 and 7.
One notable development was a new grading classification
which now includes PTG for Plantation Teak Grade and
there are 3 grades, PTG 1, 2 and 3.
In the tender of October 2022 there was another grade
offered, Thinning Post.
PTG grading is based on log girth (circumference). The
girth of PTG 1 is 5-ft and up, PTG 2 is of 4 ft to 4ft 11inch
and PTG 3 is between 3 ft and 3 ft 11 inches. Another
grade PTP covers Plantation Teak Post or Plantation Teak
Poles.
Myanmar manufacturers lament that they are unable to
freely market products from logs purchased from MTE as
the enterprise is subject to financial restriction.
Rise in imports tilts trade balance
Myanmar’s total goods imports and exports surged almost
18% year on year to over US$27 billion in nearly 10
months of the 2022-23 fiscal year beginning in April last
year according to the Ministry of Commerce.
From April last year to January this year exports rose 14%
year on year to over US$13.36 billion from a year earlier
while imports climbed 23% to over US$13.8 billion.
See:
https://www.macaubusiness.com/myanmars-foreign-tradeup-18-47-pct-in-nearly-10-months/
6.
INDIA
Sawnwood and veneer price indices marginally
higher
The annual rate of inflation based on the Wholesale Price
Index was 4.95% in December 2022 compared to 5.85% in
November of the same year. The decline in December
inflation was mainly because of a fall in prices of food,
mineral oils, crude petroleum and natural gas, textiles and
chemicals.
The wholesale price index for manufacturing declined in
December to 141.1. Out of the 22 NIC two-digit groups
for manufactured products 12 groups saw an increase in
prices while in 9 groups prices declined.
The increase in price was mainly contributed by other
manufacturing; printing and reproduction of recorded
media; electrical equipment; other non-metallic mineral
products; furniture and beverages. December prices for
sawnwood and veneer were marginally higher than in
November.
See:
https://eaindustry.nic.in/pdf_files/cmonthly.pdf
Changes to Customs duties
It is anticipated the government will increasse Customs
duties especially for finished goods in the budget for fiscal
2024 to “curb non-essential imports and improve local
production” according to media reports. At the same time
there are proposals for duty cuts in some cases, especially
for raw materials.
In the previous budget there were some anomolies which
will be rationalised such correcing the odd duty structure
where some raw materials were taxed at a higher rate than
the finished goods.
The duty changes are aimed at stemming non-essential
imports to held address the trade inbalance. In addition to
the duty changes the government intends to address
imports of low grade products including wooden furniture
by ensuring imports meet the same standards demanded of
domestic products.
See:
https://www.financialexpress.com/budget/union-budget-2023-24-customs-duty-hike-on-dozens-of-items-likely-2956804/
Strong demand in housing market
High demand for pricey homes, a generational shift toward
home ownership, capital appreciation and the high cost of
home rents were the main issues in India’s real estate
sector in 2022. In 2022, demand for homes increase by
over 30% yoy to a nine-year-high.
The drivers of this demand were primarily the postpandemic
need for security, increased savings and
relatively little income disruption for middle and
higherincome groups according to property consultants
Knight Frank India.
See:
https://theprint.in/economy/why-indias-housing-market-hita-9-year-high-in-2022-higher-savings-need-forsecurity/1308059/
In related news, a recent sector from ICICI Securities
reported by Businessworld says higher spending on home
improvement after the pandemic contributed to firm
demand for woodbased panels, MDF and furniture.
Keshav Bhajanka, Executive Director, Centuryply India,
(CPIL) has said a further boost to the housing sector
through tax breaks would help maintain the growth
momentum in the woodbased panel sector.
See:
https://www.businessworld.in/article/Boost-To-Housing-Sector-In-Budget-Will-Push-Plywood-Sector-Growth-CPIL/23-01-2023-463030/
No further rise in covid after mid 2022 jump
The third covid wave in India that began in the first week
of January 2022 peaked at around 338,000 new infections
on January 21 and came to an end by the first week of
March 2022. Except for a short period, mid-June to mid-
August after the third wave, India did not experience any
further rise in new infections during 2022.
On 29 December 2022 the Indian Government announced
new COVID-19 surveillance measures for international inbound
travellers with immediate effect.
See:
https://www.thehindu.com/sci-tech/health/why-india-hasnot-witnessed-any-surge-in-covid-19-cases-formonths/article66416358.ece?cx_testId=12&cx_testVariant=cx_1&cx_artPos=0&cx_experienceId=EXT8TLE3MA2V#cxrecs_s
and
https://www.mohfw.gov.in/pdf/GuidelinesforInternationalArrivals29thDecember2022.pdf
Plywood
Manufacturers have been trying to raise plywood prices
because of the increase in production costs pushed up by
higher resin and formaldehyde costs. Plywood prices are
expected to rise in February.
7.
VIETNAM
Industry targets exports of US$18 billion
In 2022 Vietnam’s exports of wood and wood products
has been reported at US$16.9 billion. Despite the
slowdown of export growth during the year the industry is
forecasting a recovery in the first quarter of 2023.
The Vietnam Timber and Forest Products Association is
anticipating 7-9% growth in 2023 to achieve exports of
US$18 billion or more. The Association expects a
recovery from the second quarter of this year.
The chairman of the Vietnam Timber & Forest Products
Association, Do Xuan Lap, said 2022 was one of the
toughest years ever for the sector.
The wood processing and exporting sectors faced
difficulties due to a lack of capital and raw materials
coupled with price hikes and many exporters had to cut
their workforce and reduce production due to limited
orders.
To fulfill the 2023 targets the industry will continue to
focus on improving the competitiveness of domestic
manufacturing by reducing wood imports, applying
science and technology in promoting workplace
productivity, speeding up digital transformation to cut
production costs and enhancing trade promotion activities
at international trade fairs.
See:
https://en.vneconomy.vn/wood-industry-targets-18bln-in-2023-exports.htm#:~:text=Vietnam's%20wood%20industry%20has%20set,quarter%20of%20this%20year%20onwards.
VIFA EXPO 2023 to promote Vietnam's wood industry
The 14th Vietnam International Furniture and Home
Accessories Fair in 2023 (VIFA EXPO 2023) will be one
of the biggest trade promotion event for Vietnam's wood
industry in 2023.
The Expo, organised by Lien Minh Wood Handicraft
Company, is expected to take place at the beginning of the
year. It is hoped to provide a boost for the domestic wood
industry enterprises to promote exports and approach new
customers.
According to a company spokesperson VIFA EXPO 2023
will take place in March when leading international
furniture fairs in Southeast Asia and Asia will be
organised. This will facilitate international buyer visits.
A series of regional fairs starts with the Malaysian
International Furniture Fair on 1 March, the Asian
International Furniture Fair in Malaysia on 7 March, the
International Furniture and Fine Art Export Fair in 2023 in
Vietnam on 8-11 March, Indonesia International Furniture
Expo 2023 on 9-12 March, the Philippine International
Furniture Show 9-11 March, the China International
Furniture Fair on 18-21 March and the International
Famous Furniture Fair in China on 15 March.
The VIFA EXPO in March has attracted more than 600
businesses to participate with nearly 2,400 registered
booths on a total area of 44,000 square meters.
The organising committee of VIFA EXPO 2023 will
arrange business matching sessions during the fair. In
addition the committee will offer tours to visit wood
processing factories in the southern provinces of Binh
Duong, Dong Nai, Long An and Ho Chi Minh City.
According to a Head of the Timber Association in the
Southern Province of Binh Duong whose members
account for nearly 50% of the national wood product
exports, the annual fair has become an important
promotion channel between businesses and customers in
the country as well as internationally. Most large
enterprises agreed to participate.
See: http://vifafair.com/home/
and
https://www.sggpnews.org.vn/vifa-expo-2023-expected-topromote-vietnams-wood-industry-post99448.html
Carbon trading set for 2028
The Vietnamese government has issued Decree No.
06/2022/ND-CP Providing Regulations on Reduction of
Greenhouse Gas Emissions and Protection of the Ozone
Layer (hereinafter “the Decree”).
The Decree provides detailed provisions for Article 91
“Reduction of Greenhouse Gas (GHG) Emissions,” Article
92 “Protection of the Ozone Layer,” and Article 139
“Establishment and Development of the Carbon Market”
of the Law on Environmental Protection 2020. For the
carbon market, the Decree specifies that companies will be
given guidance on the scheme and undergo some pilot
market operation followed by full operation of the carbon
credit trading market formally launched in 2028.
57 million carbon credits annually
Information from the Ministry of Agriculture and Rural
development (MARD) says Vietnam can sell 57 million
carbon credits to international organisations each year
earning hundreds of millions of dollars.
This is considered a new resource and if managed well
will generate a considerable source of funds to increase
incomes for forest growers and make a significant
contribution to the protection and development of forests
in Vietnam.
However, in order to take advantage of the potential of
forest carbon credits trading MARD has indicated the
country needs to improve the legal framework for forests.
See:
https://monre.gov.vn/VanBan/Lists/VanBanHanhChinh/Attachments/282/06-nd.signed.pdf
and
https://enviliance.com/regions/southeast-asia/vn/report_5586
8. BRAZIL
Debate on future of Amazon forest sector
The fifth Forest Legality Solutions Forum, entitled “The
Future of the Forest Sector in the Amazon”, was hosted by
the Institute of Agricultural and Forest Management and
Certification (IMAFLORA) in Belém, Pará State.
The Forum was in three parts, “Overview and Future of
Forest Management in the Brazilian Amazon”, “Forest
Concessions” and “Perspectives on the Forest Sector“. The
aim was to address the potential of forest production in the
Amazon Region, the difficulties, obstacles, perspectives
and paths to legal and sustainable production.
The forum heard it is suspected that much of timber
production in the region is harvested illegally and the
question is how to address this. The Forum brought
together private companies, communities, public
organizations, private sector entities and professionals
working in the area to promote a technical dialogue among
all stakeholders, to encourage actions such as sustainable
forest management and legality in the sector.
According to the Brazilian Forest Service forest
concessions are one of the main sources of forest
resources. These publically owned forest areas are granted
to the private sector or community associations under
concession contracts for sustainable, legal and controlled
use of the forest resources. There are currently 31 forest
concession management units covering an area of 1.8
million hectares of natural forests in Brazil.
See:
https://www.imaflora.org/noticia/evento-em-belem-reuneespecialistas-para-debater-o-futuro-do-setor-florestal-naamazonia
Concessions in national forests in the Amazon
The Ministry of Agriculture, Livestock and Food Supply
authorises forest concessions in the “Gleba Castanho”
forest and the “Balata-Tufari” National Forest in the State
of Amazonas. The concession contract authorises
sustainable forest management and the harvesting.
The Gleba Castanho and the Balata-Tufari National
Forests were qualified under the Investment Partnerships
Program (Programa de Parcerias de Investimentos - PPI)
for forest concession.
The Gleba Castanho Forest is a Forest Management Unit
(FMU) located in the municipalities of Careiro, Manaquiri
and Beruri in the state of Amazonas covering
approximately 240,000 hectares and the area of forest
concession covers approximately 151,000 hectares.
The Balata-Tufari National Forest is located between the
Madeira and Purus rivers, close to the municipalities of
Humaitá, Tapauá, Lábrea and Canutama, in the State of
Amazonas and has an area of 1.1 million hectares (of
which approximately 564,000 is available for SFM and
harvesting.
The allocation of forest concessions brings benefits to
local regions by generating jobs, income and improving
the quality of life of the populations in the area.
See:
https://forestnews.com.br/ministerio-da-agriculturaautoriza-concessoes-em-florestas-nacionais-da-amazonia/
Export update November 2022
In November 2022 Brazilian exports of wood-based
products (except pulp and paper) declined 27.5% in value
compared to November 2021, from US$381.4 million to
US$276.7 million.
Pine sawnwood exports dropped 25% in value between
November 2021 (US$74.4 million) and November 2022
(US$55.9 million). In volume terms exports fell 18% over
the same period, from 261,100 cu.m to 214,200 cu.m.
In contrast, tropical sawnwood exports increased 28% in
volume, from 32,300 cu.m in November 2021 to 23,200
cu.m in November 2022 but the value of these exports
decreased 4% from US$13.8 million to US$13.3 million,
over the same period.
Pine plywood exports experienced a 38% decrease in
value in November 2022 compared to November 2021,
from US$71.4 million to US$44.2 million and the volume
dropped 24% over the same period, from 180,000 cu.m to
136,300 cu.m.
Similarly, tropical plywood, exports decreased in volume
74% and in value 71%, from 6,900 cu.m and US$3.8
million in November 2021 to 1,800 cu.m and US$1.1
million in November 2022.
As for wooden furniture, the exported value fell from
US$77.8 million in November 2021 to US$52.0 million in
November 2022, a 33% drop.
Export update December 2022
To complete the statistic for the year, in December 2022
Brazilian exports of wood-based products (except pulp and
paper fell 34% in value compared to December 2021, from
US$423.2 million to US$278.8 million.
Pine sawnwood exports declined 44% in value between
December 2021 (US$81.6 million) and December 2022
(US$45.6 million). The volume of exports decreased 38%
over the same period, from 294,200 cu.m to 183,700 cu.m.
Tropical sawnwood exports also fell dropping 55% in
volume, from 39,000 cu.m in December 2021 to 17,500
cu.m in December 2022. In value, exports decreased 35%
from US$15.8 million to US$10.2 million, over the same
period.
Pine plywood exports continued to fall in December
dropping 37% in value compared to December 2021, from
US$68.7 million to US$43.4 million. In volume, exports
also decreased by 27% over the same period, from
185,900 cu.m to 135,600 cu.m.
As for tropical plywood, export volumes again dropped
sharply,70% and in value by 73%, from 8,300 cu.m and
US$4.5 million in December 2021 to 2,500 cu.m and
US$1.2 million in December 2022.
The downward trend in exports continued with wooden
furniture where the export values decreased from US$74.5
million in December 2021 to US$43.9 million in
December 2022, a 41% fall.
Furniture Export Programmes in Brazil
The Brazilian furniture sector has enormous potential but
it represents only 4% of the world furniture production so
there are opportunities for expansion. Export programmes,
such as the “Brazilian Furniture Project” and “Orchestra
Brazil Project”, seek to promote Brazil in the international
furniture market.
The Brazilian Furniture Project, the Brazilian Association
of Furniture Industry together with Apex-Brazil (Brazilian
Trade and Investment Promotion Agency), promote
Brazilian furniture in international markets.
Between 2018 and 2020, even during the economic crisis
generated by the COVID-19 pandemic, exports by
furniture companies increased by up to 47%. The two
programmes of the “Brazilian Furniture” project (Projeto
Comprador Inspiramais and Projeto Comprador Móvel
Brasil) promoted sales of US$2.2 million in immediate
business and US$12.7 million in prospective agreements.
The "Brazil Furniture Buyer Project" brought together for
business development around 60 companies and 36
international buyers from South Africa, Belgium, Bolivia,
Canada, Chile, Colombia, El Salvador, United Arab
Emirates, Ecuador, Spain, USA, France, India, Mexico,
Nicaragua, Panama, Paraguay, Peru, Portugal, Dominican
Republic and Uruguay.
The “Orchestra Brazil” project currently supports more
than 50 companies in the components, accessories,
chemicals, machinery, equipment and software sectors of
which around 50% are exporters negotiating with a total of
98 countries.
See:
https://emobile.com.br/site/industria/programas-deexportacao-de-materias-primas-e-de-moveis/
‘Through the eyes of industry’, challenges and
suggestions from Brazil
See:
https://www.ittoggsc.org/static/upload/file/20230116/167385357759986
9. PERU
Exports of wood products for construction
Earnings from the export of wood products for
construction between January and November 2022 totalled
US$3.9 million, a drop of 34% compared to the same
period of 2021 according to the Association of Exporters
(ADEX). This contraction is explained by lower demand
in the US.
In the same period exports to North America were worth
US$2.2 million, down 46%. Other destinations were
France (US$0.5 million) where there was a growth in
exports, Chile (US$0.3 million) and Mexico (US$0.2
million) where there was a decline of 48%. Wood
products were also shipped to the Netherlands (US$0.15
million), Jamaica (US$0.12 million), Honduras (US$0.10
million) along with Spain, the Dominican Republic and
Belgium.
The leading item was builders’ woodwork and items for
construction which represented 55% of the total despite
closing representing a year on year decline of 30%. Other
export items were wooden frame and doors. Exports were
shipped mainly (94%) through Lima Port. Other ports
were Madre de Dios and Callao.
Forest management in Central Selva
During 2022 the National Forest and Wildlife Service
(SERFOR) undertook to train stakeholders in Junín and
Pasco. The training was aimed at producers and forest and
wildlife managers and addressed technical assistance in
management and forest and wildlife management.
SERFOR also conducted training and awareness raising in
the ‘Central Jungle’ aimed at preventing of illegal logging,
forest fires, operation of primary transformation centres
and implementation of the mandatory ‘Book of
Operations’.
see:
https://www.forest-trends.org/wpcontent/uploads/2020/06/Peru-June-2020.pdf)
In related news, the Organism for the Supervision of
Forest Resources and Wildlife (OSINFOR) conducted a
variety of training activities for stakeholders in the
Amazon Region with the aim of strengthening capacity on
forest management.
With the support of donors such as USAID/Probosques,
the German GIZ Cooperation, Rainforest Foundation US,
the USAID Prevent Project and the United Nations Office
on Drugs and Crime (UNODC) over 40 capacity building
workshops in various regions of Peru were conducted. The
workshops had as central themes; community forest
management, the prevention of forest crimes, the use of
OSINFOR applications and digital platforms as well as the
dissemination of compensation mechanisms for fines for
forest infractions.
OSINFOR works hand in hand with the Regional Forest
and Wildlife Management (GERFFS), through the
exchange of information and knowledge about the sector,
as well as the strengthening of capacities and the use of
new technologies.
An important aspect of the coordinated work is linked to
the identification of opportunities for improvement within
the framework of their competences and the promotion of
the use and application of information technologies (ICT)
that strengthen and contribute to forest and wildlife
surveillance.
