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1.
CENTRAL/ WEST AFRICA
Marginal price changes in West Africa amid dull market
In the West African region, there were some minor
upward price adjustments for logs, while most prices
remained unchanged. European log purchases were very
small in volume as the majority of the log trade was to
Asian destinations. China, the largest buyer along with
India, was still quite active in the market. The European
sawn lumber market was also quiet although some
European traders reported that stocks of some species
were becoming very low leaving merchants with
fragmented specifications and limited ability to fulfill even
quite run-of-the-mill user orders. Even sapele was
mentioned in this context, although prices for exporters
were very low and had not yet shown any strengthening;
there were also very few enquiries for new contracts.
In continental Europe, some government financial
measures had started to make an impression on the level of
business in the building and construction industries. This
was expected to trickle down to help the timber trade,
though there were still reports of business closures in light
of the economic downturn. The situation in the UK had
not improved, as government announced initiatives had
not yet impacted on the construction industries even
though the housing market had reported more activity and
a larger number of housing sales than in the third and
fourth quarters of 2008.
2. GHANA
Export applications drop 21% in fourth quarter 2008
One thousand, seven hundred and thirty three (1,733)
export permits were vetted, processed, approved and
issued to exporters during the fourth quarter of 2008
covering shipments of various timber and wood products
through the ports of Takoradi and Tema as well as through
overland exports to neighboring ECOWAS countries,
according to the permit section of Timber Industry
Development Division (TIDD).
These export permits were issued by offices in Sunyani
(55 permits), Kumasi (117 permits), Tema (197 permits)
and Takoradi (1,364 permits) as well as the head office of
TIDD, representing 3.17%, 6.75%, 11.37% and 78.71% of
the total export permits, respectively. The corresponding
total export permits issued for the third quarter of 2008
was 2,196. This was a substantial decrease of 21% in the
number of permits issued for the exports of timber and
wood products compared to the fourth quarter of 2008.
The decline was largely attributed to the global economic
slowdown.
Lumber, both kiln-dried (KD) and air-dried (AD),
continued to register the highest number (792) of export
permit applications, representing nearly 46% of the total
number of export permits issued during the period under
review. This was followed by plywood, mouldings and
sliced veneer. There were substantial reductions in the
number of permits issued in the fourth quarter for the
export of lumber, block boards, floorings, teak
billets/poles/logs, plywood, curl veneer, sliced veneer and
rotary veneer. However, demand for the exports of lumber
(both KD and AD) was still higher than tertiary wood
products such as furniture parts, mouldings, floorings,
dowels, broomsticks and profile boards.
For free and special permits, four (4) free export permits
were issued solely in Takoradi to Mondial Veneer (Ghana)
Ltd. and Peewood Craft & Art Cottage for the shipment of
wooden carvings, lazy chairs, wood craft boxes, wooden
drums, bar stools, bar chairs, cane chairs and cane centre
table. These products were shipped to clients in the EU.
Five special export permits were issued solely in Takoradi
to Machined Wood Company Ltd. for the shipment of
okoume laminated strips/mouldings to Italy. These were
200.633 m³ by volume and EUR113,780 by value. These
laminated mouldings were made from okoume sawn
timber, which were imported from Gabon. In contrast,
only one special export permit was issued to Machined
Wood Company Ltd. in the previous quarter for the
shipment of sapele laminated strips to the UK.
With respect to overland exports, 295 export permits were
granted to a number of timber companies to export lumber
and plywood by road to Burkina Faso, Nigeria, Niger,
Benin and Togo. The total volume and value of permits
issued for overland exports during the fourth quarter of
last year were 31,801m³ and EUR10.16 million,
respectively. The total number of permits issued for
overland exports during the previous quarter was 338 and
these export permits were 32,937 m³ by volume and
EUR10.30 million by value. These figures represent
reductions of 12.72%, 3.45% and 1.27%, respectively in
the number, volume and value of permits issued for
overland exports in the fourth quarter of 2008 compared to
the previous quarter.
The drop in the number, volume and value of overland
exports, in comparison with global trends, indicates that
the global economic slowdown has not severely affected
trade amongst the ECOWAS member countries. This is
further indication of the importance of the ECOWAS subregional
market and reinforces the need for Ghana to
diversify its export markets.
3.
MALAYSIA
Dompok appointed new Minister of Plantation Industries
and Commodities
The Star reported Mr. Bernard Dompok had been
appointed the new Minister of Plantation Industries and
Commodities as of 10 April 2009. Mr. Dompok was born
and brought up in the timber resource rich state of Sabah,
and is familiar with many of the issues and challenges
affecting the local timber industry
Furniture manufacturers face threat of closure
Some furniture manufacturers could be forced to close
within six months as a result of the 50% increase of the
levy for foreign workers, indicated The Star. Mr. Desmond
Tan, president of the Malaysia Furniture Entrepreneurs
Association (MFEA), commented that the federal
government needed to address the problem quickly as it
would have an adverse effect on the operational costs of
furniture manufacturers. With declining orders, he added
that it could lead to further layoffs at the management and
executive levels. Furniture exports posted a 14.2% drop in
January 2009, to RM621.3 million, from RM724.2 million
compared to the same month in year 2008. Malaysia¡¯s
furniture exports registered 2% growth in year 2008 from
year 2007, and were worth RM8.7 billion. This translates
to only 2.6% of the world¡¯s market for furniture.
MTC to represent timber sector at MICCOS event in August 2009
The Malaysian agricultural commodity industry will be
holding a major exhibition for international buyers at the
Malaysia International Commodity Conference &
Showcase (MICCOS), which will be convened at the
Malaysia Agro Exposition Park Serdang (MAEPS) from
13 to 16 August 2009. The Malaysian timber sector will be
represented by the Malaysian Timber Council and the
Malaysian Timber Industry Board. For more information,
see: http://www.miccos.com.my/?page=welcome
Properties facing foreclosure on the rise in Malaysia
The number of properties facing foreclosure or
receivership had increased from between 10% to 20% as
more property owners fell victim to the recession in
Malaysia. Personal and business bankruptcy in Malaysia is
expected to increase significantly as well, reported The
Star.
Withdrawal of investment could impact timber sector
Many banks are reportedly to have started withdrawing
trade credit facilities from a wide range of exporters,
including those with low credit risk exposure in the timber
sector. Most Malaysian banks traditionally favor the
construction sector over the manufacturing and trading
sectors. This has contributed to the large number of
abandoned construction projects in Malaysia during a
recession, which in turn drives down prices of building
materials and timber products.
4.
INDONESIA
Pulp and paper market turns focus to Asia
The decline in the demand of paper and pulp in
Indonesia¡¯s traditional markets has shifted attention to
major consuming countries in Asia such as China, India
and South Korea, according to Mr. Muhammad Mansur,
chairman of the Indonesian Pulp and Paper Association
(APKI). This new focus is a result of new forest
concessions of 7 million ha and the issuance of new
permits to allow the collection of timber waste to be used
as raw material, reported The Jakarta Globe. APKI¡¯s
forecast stated that China¡¯s demand for pulp will reach 25
million per year eventually, from 2007 to 2010, and
India¡¯s demand will reach 14 million tons for the period.
Indonesia faces critical shortage of rattan
Indonesia, the world¡¯s largest exporter of rattan and rattan
products, is facing a critical shortage of the material.
Prices for rattan climbed from Rp. 4,000 per kg. in the
1990¡¯s to Rp. 28,000 per kg. at present. This is due largely
to producers¡¯ preference to export unprocessed rattan in
bulk than to sell to local craftsmen. Bulk export prices for
rattan range from a low of Rp 9,344 to a high of Rp 16,150
per kg. In addition, local buyers have to pay a 10% levy on
all local inter-island shipments. Kalimantan is the main
source for most of Indonesia¡¯s rattan.
5.
MYANMAR
Low trade seen during holiday period
Local experts in Myanmar observed low trading activity
during the Myanmar New Year holiday, which occurred
during 11-21 April. The next tender results will be
published during in the TTMR 14:9.
6. BRAZIL
State inspection results in sawmill closures and seized
illegal timber
According to Ascom MMA/Ascom IBAMA, the National
Military Force, the Brazilian Patrol Police, the
Environmental Military Police, the Brazilian Institute of
Environment and Renewable Natural Resources (IBAMA)
and the National Indian Foundation (FUNAI) have
recently started a mega-inspection operation to control
illegal forest activities in the Amazon region. Of particular
interest is the municipality of Nova Esperança do Piri¨¢, in
the Northern state of Par¨¢, which has a population of
32,000 and is reported as being a hot spot for
environmental crimes. To date, a total of thirteen sawmills
in the municipality have cleared 80,000 of 250,000
hectares of an indigenous reserve and held employees
captive as slave labor.
The recent inspection was led by the Minister of
Environment. Sawmill and/or forest land owners were not
detained, but computers and documents were seized
during the field inspection. The seized materials could
result in the indictment of at least ten people found
responsible for illegal operations and for acting as buyers
of illegal timber.
Seven sawmills were embargoed, which produce about
2,000 m³ of roundwood and 200 m³ of sawn wood, and
their materials were seized. In the coming weeks, other
sawmills will be closed. According to the Minister of
Environment, none of them had forest management plans,
a pre-requisite for obtaining environmental permits for
legal forest harvesting.
Part of the seized timber, including high value species
such as maçaranduba, will be sold in auctions, and the
remaining part will be donated to the municipality for
public use, such as construction of bridges, low-income
housing and schools. The money from the auction will be
used for environmental preservation projects of the federal
and state governments.
Par¨¢ faces further closure of solidwood companies
The export-oriented timber industry is the basis of the
economy of the Novo Progresso region, one of the highest
revenue generating municipalities in the state of Par¨¢.
However, such revenue has declined mostly due to the
difficulty for companies to obtain new permits for Forest
Products Transportation (ATPFs), since the federal
government¡¯s Curupira inspection operation started in
2008.
As a result, production of manufactured wood products
has fallen 50% and layoffs, collective holidays and even
closure of mills has already started throughout the state,
reported the Jornal Folha do Progresso/Madiera Total.
Over 10,000 people have lost their jobs in rural areas and
in timber-processing mills in West and Southwest regions
of Par¨¢.
Brazil¡¯s March 2009 exports continue downward trend
Brazil¡¯s wood products exports (except pulp and paper)
dropped 38% by value compared to the same period in
2008. The charts below show the volume and value of
Brazil¡¯s exports for March 2009 compared to the same
month a year earlier:
Brazil searching for ways to boost forest sector
According to Centro de Inteligencias em Florestas, Brazil
is seeking ways to overcome the effects of the financial
crisis. At the beginning of the financial crisis, the Brazilian
forest sector did not expect to be as affected as other
sectors. However, in the first two months of 2009, exports
declined and many investments and contracts were
reduced or cancelled.
As for the solidwood industry, the segments affected were
sawnwood, doors, plywood and high value-added products
that are export-oriented, mainly to the North American
market. For instance, from July 2008 to January 2009,
sawnwood and plywood exports plunged 20% and 48%
respectively.
To mitigate the effects of the crisis, Brazil has attempted
to diversify exports to foreign markets, expanding
participation in the domestic market and diversifying
products, as well as increasing manufacturing of valueadded
products. In addition, ABIMCI (National
Association of Mechanically-Processed Timber Products)
has requested the government to adopt economic measures
to benefit the sector, such as cost and tax reductions.
The charcoal market has also been affected by the crisis,
mainly due to the significant decrease in market demand
for pig-iron, which has affected the iron and steel industry
in Brazil. According to the Brazilian Institute of the Iron
and Steel Industry (IBS), in the first half of both January
and February 2009, the decrease in production exceeded
40% compared to the same period of 2008. Other
charcoal-related segments have reduced their consumption
and charcoal prices have continued to fall, negatively
impacting the sector.
7.
PERU
Exporters redirect trade to local markets
Wood exporters have been rerouting exports to the
national market as well as to non-traditional market
destinations overseas, as the international economic
downturn has negatively affected demand from traditional
market destinations for Peruvian exports. Currently the
countries importing most of Peru¡¯s wood products are
Mexico, China and the US, according to the Peruvian
Exporters Association (ADEX). ADEX Forestal
Committee President Santiago Echecopar explained that of
the USD222 million of 2008 Peruvian exports, three
countries accounted for 84% of Peru¡¯s total exports worth
USD185.9 million.
Mexican elections delay Peru¡¯s signature to NAFTA
Peru¡¯s signature of the North American Free Trade
Agreement (NAFTA) has been delayed due to political
uncertainties in Mexico. With upcoming elections in
Mexico on 5 July 2009, Peru cannot sign the Agreement
until there is a clearer political view in the country,
according to the Ministry of International Commerce and
Tourism. This delay could stall exports from several
productive sectors, as NAFTA is designed to facilitate
exports such as value-added wood products to signatories
to NAFTA. Mexico is currently the main buyer of Peru¡¯s
wood products.
Environment Ministry recommends revised export
quotas for mahogany
On 16 April 2009, the Environment Ministry issued a
recommendation to set limits on exports of mahogany,
with the Ministry allowing only 562 to 851 trees to be
harvested for export. The recommendation was drafted by
the Environment Ministry (as the authority on CITES),
with the support of the National Agricultural University of
La Molina. The new recommendation would also allow
the Agricultural Ministry to be a CITES administrative
authority in Peru. As part of the recommendation, the
Ministry can also approve tariffs on mahogany exports in
2009. Mahogany has high commercial value and is a
highly demanded commercial species in the international
market.
8. BOLIVIA
Preliminary estimates show 10% decline in forest
exports in 2008
Preliminary statistical reports indicate that forest products
exports from Bolivia during January to November 2008
dropped 10% compared with the same period in 2007. The
value of forest products exports fell from USD197.7
million to USD177.6 million, breaking the positive trend
in Bolivia¡¯s forest exports since 2002.
Exports of manufactured products accounted for 80.2% in
January to November 2008. Doors, plates, fiberboard,
boards, parquet, decking, furniture, shelled chestnut, and
palmito accounted for this total. The remaining 19.7%
consisted of semi-finished products, which include: sawn
timber; poles; tables; and cocoa beans. The cause of the
decline in export value was the international economic
downturn and other political events affecting the forest
sector.
Exports of wood products over the same period in 2008
represented 48.7% of the total or USD85.1 million. Nonwood
products were up 51.3% or equivalent to USD91.1
million, with shelled chestnuts representing the entire
value.
9. Mexico
US and Mexico sign historic agreement on climate
change
Xinhua news service reported on the historic agreement
signed by Mexican President Felipe Calderon and US
President Barack Obama on 16 April 2009, which will
provide a framework for bilateral work on energy and
climate change and allow for information exchange and
other technical cooperation. During a joint press
conference in Mexico City, President Obama explained
the agreement would focus on renewable energy, energy
efficiency, sustainable use of forests and carbon reduction
technology.
Both countries will work to reduce greenhouse gas
emissions, promote climate change adaptation measures
and fortify the sharing of energy resources between the
two nations. Other bilateral work will include the
establishment of organizations and information exchange
to maintain and establish greenhouse gas inventories and
design strategies for greenhouse gas reduction. It will also
promote development of renewable energy by undertaking
technical and economic viability studies and development
of projects in the border region between the two countries.
10.
Guyana
Prices surge over previous fortnight
Compared to the first half of March 2009, log and
sawnwood prices in April 2009 showed gains by value.
Plywood prices remained fairly stable compared to the
same period in 2008. Splitwood prices were more
favorable in 2008 compared to 2009 prices.
Value-added products such as indoor furniture have shown
significant export value earnings compared to the first half
of April 2008. The Caribbean market remains the main
destination for this product. High export value earnings
were also recorded for outdoor garden furniture over the
same period, with the UK being the main export
destination.
Guyana¡¯s local forest-based communities benefit from
training in forest management
Forest-based communities in Guyana have traditionally
received forest management training through initiatives of
the Guyana Forestry Commission (GFC) and the World
Wildlife Fund. However, the emergence of the Forestry
Training Centre Incorporated (FTCI), established with
support from ITTO, has served as the catalyst to provide
forest management training to a large number of
communities. FTCI¡¯s forest management training has been
designed to be applicable to community forest
management and community forestry needs.
Communities benefit from forest management training in
three main ways. Firstly, forest management training
enables communities to manage their forest resources with
basic knowledge of forestry and other basic management
tools (e.g. maps). Secondly, it allows communities to
develop a shared understanding of their situation, which in
turn enables communities to better source and utilize
technical assistance in forestry provided by donors;
further, communities become more active during
consultations because they have more information on
which to take decisions. Thirdly, trained members of the
communities are able to take up job opportunities with
logging enterprises and at the GFC¡¯s forest stations near
their communities, leading to cash inflows for the
development of schools, medical centers and community
businesses.
Since FTCI started its forest management training in 2007
through ITTO Project PD 333/05 Rev.2 (I), many younger
community members have been seeking support to
participate in the one-year forestry certificate course at the
Guyana School of Agriculture. The GFC itself offers full
scholarships for up to five persons per year.
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