Covid-19 crisis has multiple timber trade impacts

Members of the STTC Technical Committee report the Covid-19 pandemic resulting in radically reduced timber trading across Europe. Many companies are temporarily closing or curtailing operations, pushing back orders and asking for longer payment terms. Impacts of the health crisis are also reported from China and African supplier countries.

The STTC Technical Committee, which comprises the European Timber Trade Federation, national trade associations, the FSC, PEFC and ATIBT, held a remote meeting to address the crisis and share experience.

The UK TTF said it was busy with member enquiries, particularly on government grants to enable companies to pay furloughed personnel during temporary shutdown. Some importers, distributors and merchants have suspended business. Others are operating at much reduced levels. Some demand continues from the UK building sector, with work on construction sites allowed within new health and safety rules. DIY sales are also holding up, which is attributed to consumers undertaking repair and refurbishment projects while off work. Importers say they have asked overseas suppliers to push back orders by 30 to 60 days but there is still concern about the build-up of landed stocks at ports, with companies unable to accept cargoes as their own storage is full.

German trade federation GD Holz said wholesalers had not at the time been significantly affected. How long this would last depended on continuing construction activity. However, for small to medium sized timber enterprises the situation was described as ‘catastrophic’. It was suggested that, to provide some relief, they might adopt the strategy of the electronics sector, allowing consumers to pre-order and pick up goods. Many German retail and other consumer-facing businesses were at a full stop, but DIY outlets were allowed to open in some parts of the country and hardware stores continued to serve B2B customers.

An earlier report on the Fair&Precious (F&P) website stated that Netherlands importers had sufficient stocks for the short term and ports and road transport had been designated key sectors and continued to operate.  The Netherlands Timber Trade Association also reported the DIY sector continuing to trade well. Overall timber trade sales, however, are expected to be down through the summer. The NTTA also told the STTC Newsletter that as of April 15, the Dutch building sector was still working subject to health and safety restrictions. However the number of construction projects was decreasing, with forecasts of a 50% fall in new home building. At the same time, activity in the renovation sector has reduced by 80%. The pandemic was disrupting timber supplies to the Netherlands from the rest of Europe and Malaysia and, while imports from Africa were ‘reasonably normal’, they were also expected to decrease. Plywood and other panel products were in increasingly short supply.

French trade body Le Commerce du Bois said the picture was mixed in France. Merchants were impacted first as construction and manufacturing customers shut down, importers followed. Subsequently, however, most merchants are reported to have reopened with much reduced personnel. Timber end user industries and importers largely remained closed.

The situation in Spain was described by trade association AEIM as disastrous. Members had postponed contracts and shipments, with construction and other customer sectors in shutdown. Some suppliers to parts of the joinery sector, however, were still active. And according to the F&P Covid-19 report, wood was still coming into ports as normal, although there were ‘difficulties for companies withdrawing goods’.

The latest Market Report from the International Tropical Timber Organisation includes a supplier country survey showing widespread disruption of the tropical wood sector by Covid-19. The industry was being affeced by both national measures to curb spread of disease and a drop in export demand. At the time of the report, Ghana was not in total lockdown, but regional controls were impacting timber businesses. Mills in Cameroon were not operating. In Malaysia movement control orders had resulted in a ‘drastic slowdown’ in forestry and timber sectors, while 76% of respondents to a timber business survey by Vietnamese trade body Viforest said they had suffered ‘pandemic damage’.  In Indonesia fall-off in demand had led to 280,000 furniture industry job losses.

According to a 15 April report from the China Timber and Wood Product Distribuion Association (CTWPDA), Chinese timber imports are set to decline 10-20% due to contraction in export demand. Already some imported material destined for re-export as finished wood products has been diverted to domestic consumption. However, the latter has also been hit by the pandemic, particularly in the ‘homes and living sector’. The CTWPDA reported disruption in timber supply from a range of sources, but said that the country had sufficient imported material to last two months.

The Fair&Precious website has a special report giving further information on the effects of the Covid-19 pandemic on the timber sectors of Europe, Africa and China.

As is the case in many regions where tropical timber is produced, Northern Congo lacks coordinated and federal support. In the fight against COVID-19, forest company INTERHOLCO is currently fundraising to buy essential, life-saving medical equipment to upgrade the capacity of the hospital that the company manages. This is located in the remote village of Ngombé (in the heart of the forest, as shown here on Google), where employees live with their families forming a community of 10.000 people, 1.000 km away from the capital Brazzaville. To learn more and to support – every bit matters! – see INTERHOLCO’s fundraising campaign here, and for regular updates follow the company on Linked-In or check out their news page.

Pressure mounts against Indonesian legality assurance move

Lobbying against a proposal for Indonesia to abandon obligatory legality assurance licensing for timber exports is increasing in intensity. Pressure is growing both inside and outside the country for the move, which was conceived  by the Indonesian Ministry of Trade, to be abandoned.

Under the Ministry of Trade ruling, due to be implemented on May 27, timber exporters would no longer have to provide SVLK legality assurance documentation with export shipments, although could continue to do so if foreign customers require them. As things currently stand, Indonesian exporters are obliged to provide such documentation in the form of V-legal licences to non-EU export customers, and FLEGT Licences to those in the EU.

As the EU requires Indonesian imports to be backed by FLEGT Licences, they will continue to be supplied. The concern, however, is that abandoning the obligation on companies to provide V-Legal documentation to exports elsewhere could still impact Indonesia’s FLEGT Voluntary Partnership Agreement with the EU, as it requires that an equal standard of legality assurance is applied to all exports.

The Indonesian Ministry of Trade said its proposed change to the rules was part of a Covid-19 pandemic trade stimulation package. However, NGOs and trade media maintain that long-term lobbying by furniture and craft trade association HIMKI for the legality assurance obligation to be lifted is also involved.

Latest news at the time of publication was that the Indonesian Minister of Environment and Forestry Siti Nurbaya Bakar had sent a letter to the president, copying all other related ministers. She strongly defended the current Indonesian SVLK timber legality assurance system and urged others in government to follow the spirit of the presidential regulation that ratified the FLEGT VPA in 2014. She also asked permission for related ministries to engage formally with the EU to find a solution.

The STTC and European woodworking industries federation CEI-Bois have both written to the Indonesian embassy to Brussels urging his government to maintain timber legality assurance standards. Similar letters have also been sent to their respective embassies by eight national EU timber trade federations, plus trade bodies in Australia and the USA.

Some leading European importers have also already said they will reconsider buying from Indonesia if the new Ministry of Trade regulation goes through. One described it as a ‘watering down of Indonesia’s commitment to combat illegal timber’.

In his letter to the Indonesian embassy to the UK, David Hopkins, Chief Executive of the UK Timber Trade Federation, wrote: “The TTF is a strong ally of Indonesian timber trade and we do hope this will continue, but the UK trade will need reassurance that the robust SVLK measures you currently have in place will be upheld.”

Read the European STTC letter to Indonesian Embassy

Debate on FSC intact forest landscape protection continues

Comments from FSC and forestry operators and their representative bodies, including the ATIBT, indicate that there is still work to do to achieve consensus on intact forest landscape (IFL) protection in certified natural forests, and the issue promises to be central to discussions at the next FSC General Assembly. All agree on the need to ensure preservation of IFLs and the biodiversity and habitats they support, while at the same time maintaining the commercial viability of forest and timber businesses and the livelihoods they provide. But differences of opinion persist on what that balance between business and environmental interests looks like.

At the heart of the discussion is FSC Motion 65. This was approved in 2014 and stipulates that 80% of designated IFLs in certified natural forest concessions are protected. It became a so-called interim FSC rule in 2017, for subsequent adaptation and transposing into each country’s FSC national standard, but has been a subject of continued debate. The reason it is back in the news now, it is reported, is because stakeholders want to make it high on the agenda at the next FSC General Assembly (GA), slated for October this year, but now postponed to 2021 due to Covid 19.

ATIBT Managing Director Benoît Jobbé-Duval said that the issue had also become more urgent because ‘companies are arriving at the limits of their IFLs and beginning their exploitation’. It is in the spotlight again too because of the imminent release of several reports, into the social environmental and economic impacts of Motion 65 in the primary areas affected, the Amazon, Canada, Congo Basin and Russia. These were commissioned as the result of FSC Motion 34, which was backed by the ATIBT and passed at the 2017 FSC GA.

The first study, by Form International into the impacts of Motion 65 in the Congo Basin, which is due out shortly, “must assess whether conservation of IFLs (at 80%) endangers the logging companies, and their future commitment to certification, with, of course, the social and environmental consequences,” said Mr Jobbé-Duval. The outcome, he added, will be proposal of an IFL ‘conservation percentage acceptable to companies’. ATIBT backs last year’s proposal from the Congo Basin FSC regional working group (RWG). This recommends that 20% of IFLs within certified concessions should be conserved rather than 80%.

“We agree on protecting IFLs in general, but it must be at the commercially viable level,”  said Mr Jobbé-Duval. “It’s important to note that certified companies already put 20% of concessions under conservation through their own procedures, so additional protection of 20% of IFLs is significant.” He also highlighted that only 1.5% of IFLs in the Congo lie within concessions. “Our aim is to find solutions for better protection of external IFLs as well,” he said.

In an interview with the STTC/Fair&Precious Newsletter, FSC Executive Director Kim Carstensen said he recognised Congo Basin concession operators’ concerns. “FSC certified companies are already doing a lot for the environment and their social performance is top class. At the same time,  they are operating in a very difficult business environment. European markets are weak and also impose [due diligence] requirements, there’s competition from Chinese companies, port blockages, poor access to capital, and increasing pressure on supply of more popular commercial species and difficulties in moving to other harvestable species,” he said. “So it’s already difficult to maintain a viable forest business in the Congo, then the FSC puts what are seen as another set of restrictions on the way companies operate, so their concerns are understandable.” However, he added, while not yet the perfect solution, Motion 65 should be viewed as ‘a route into the future’. “It’s crucially important that forest operators understand the mindset shift happening in the world and find a way of working that is acceptable in a time where climate and biodiversity crises and other environmental crises have resulted in a different set of expectations on use of natural forests,” he said. “Businesses must be seen to be part of the solution, rather than part of the problem.”

He recognised that Motion 65 ‘does not have all the answers’, but said it ‘pointed in the direction we need to look’. “Of course we need these forests to maintain an economic relevance. If they don’t  they will be taken by some other interest; converted into agriculture or just used for wildlife poaching,” he said. “But at the same time businesses need to be seen to have environmental viability as well. Finding that balance is the real challenge.” Mr Carstensen said ATIBT, Congo concession holders and other FSC members had ‘every right’ to put forward new proposals on Motion 65 and FSC IFL policy and that the impact study resulting from Motion 34 should provide valuable information for taking the issue forward. “It will create a new basis for discussion of how we [protect IFLs] in a fashion that works for the countries, for the concessions and for the environmental interests of the forests,” he said, adding that Congo operators concerns about FSC IFL rules were also shared by those in the Amazon.

FSC also underlines that there is ‘country specificity’ in the way that interim rules, such as those on IFL protection, are implemented in FSC national standards. “The national standard for the Republic of the Congo allows concession operators to work 50% of IFLs,” said Mr Carstensen. ‘’Other standards are being developed for Gabon and Cameroon, and there is also the prospect of one for the Democratic Republic of the Congo.”

He assured FSC members that Motion 65 and IFLs would be a ‘top tier’ topic of discussion at the next General Assembly, which is still slated for Bali, with the date in 2021 to be announced early June at the latest. “It can’t be business as usual as that won’t be accepted in today’s world. And we believe that FSC certification, including measures to protect IFLs and other high conservation value areas, is the way forward for businesses in the Congo Basin and elsewhere,” said Mr Carstensen. “But our message is that we hear and understand the concerns of concession holders. We need to find ways together to work through this;  [ensuring] sustainable forest management is both viable and part of the solution to climate and biodiversity crises, and I think we can.”

IFLs in the Congo and Amazon

In the Congo Basin, 1.3% of all IFLs are situated in FSC-certified forest management units (FMU) and around 25% are located in protected areas. In total, 15% to 20% of all IFLs are present in managed forests and more than 50% areas are found outside protected areas or managed forests.[1]

The situation in over 300 million hectares of natural forest in the Brazilian Amazon is similar. In 2017, 0.5% of natural forest and 0.25% of the IFL area was located in FSC-certified FMUs. [2]

Given protection of a minimum of 50% of the IFLs within a certified FMU, the FSC would be employing its systems to address effectively 0.7% of the IFLs in the Congo Basin and 0.13% of the natural forest in the Brazilian Amazon (status 2017).

[1] FORM, 2020, DRAFT and, Calculated from Global Forest Watch data 
[2] FSC Brazil, 10 Oct 2017, IFL Update 

ATIBT cautiously optimistic on China illegal timber ban impacts

The International Tropical Timber Technical Association (ATIBT) is in weekly dialogue with Chinese trade bodies to follow implementation of China’s new illegal timber regulation and assess its potential impact on Congo Basin forestry and wood sectors. It is optimistic that the outcomes will be positive in terms of combating illegal timber trade, but agrees with NGOs that work is needed to ensure effective implementation and enforcement of the new regulation. It is also key, says the ATIBT, that supplier country governments work with China in tackling illegality.

The prohibition on Chinese companies ‘purchasing, processing and transporting’ timber known to be illegally sourced forms part of revision of the country’s Forest Law.  It comes into effect on July 1.

ATIBT Managing Director Benoît Jobbé-Duval said the Chinese trade as a whole should not be labelled as trading illegally. “We are talking about specific Chinese actors who continue to operate totally illegally,” he said.  “But they are in significant numbers.”

The ATIBT is developing its relationships with the Chinese Timber and Wood Products Distribution Association and Global Green Supply Chain networks to better understand the consequences of the new forest law and its impacts on the natural forests of the Congo Basin. “We must remain optimistic about the effective implementation of the illegal timber ban, but [government] announcements must be followed by very clear evidence and demonstrations of strong action on imports into China,” said Mr Jobbé-Duval. “We raised this in discussion with the Chinese organisations and their response was that enforcement will require resources that are not yet mobilised. So we’ll have to wait for these to be put in place before we can properly gauge whether regulations are being properly applied.”

Action on the ground in supplier countries to back up new Chinese measures was also essential, he said. “Their governments must also take responsibility and act in a concerted manner with the Chinese authorities to track down illegal timber traffickers,” he said.

A report on China’s Forest Law revision has been published by Cameroon NGO FLAG, but, other than this, it does not seem to have received much coverage in the Congo Basin. More communication in the region is needed, said Mr Jobbé-Duval. ATIBT says it will continue to interact with Chinese and ‘other organisations familiar with China to continue pushing it in the right direction’.

“What is certain is that Chinese, and non-Chinese players, operating illegally are causing enormous damage to the industry, discrediting it and competing unfairly with players engaged in good practices,” said Mr Jobbé-Duval.

Xiufang Sun, China-based Senior Analyst, Forest Policy, Trade and Finance of NGO Forest Trends, told the STTC that there remained ‘much to be done’ in terms of implementation of the illegal logging prohibition. “China’s State Forestry and Grasslands Administration (SFGA) has a list of tasks, such as setting standards and supervising measures as stated in the law,” she said. “By common practice, the Forestry Law Implementation Regulations will then be promulgated at least one year after the law takes force, so no earlier than July 2021.”

Importers share views on growing sustainable tropical timber market

Growing the European market for verified sustainable tropical timber demands more coordinated, cohesive industry-wide promotion. This should particularly target specifiers and consumers to convince them of the benefits of buying sustainable tropical timber, notably in incentivizing uptake of sustainable tropical forest management. NGOs and government must also be persuaded to actively encourage its use. These are among recommendations from timber importers in six of the leading European tropical timber importing countries, responding to a Sustainable Tropical Timber Coalition survey.

The aim of the survey is to ensure the market relevance of STTC’s communications and promotional activities. A total of 38 companies across Belgium, France, Germany, Italy, the Netherlands and UK took part.

Except for those in the Netherlands, the majority of survey respondents think that, while sales share of certified timber is rising, the overall market in their country for tropical timber is decreasing.

Some respondents have heard of the STTC, ATIBT and the Fair&Precious sustainable tropical timber promotional campaign. Overall, however, they expressed limited awareness of existing tropical timber marketing tools and information. The effectiveness of marketing and communications efforts, felt some, is also limited by there being too many, so diluting their impact. They maintain that a coordinated approach is needed to have any hope of success and UK respondents called for one single sustainable tropical timber promotional body.

Respondents also think that existing sustainable tropical timber marketing is addressing the wrong audience, the timber trade. Instead, it needs to be directed at consumers and key market influencers, such as architects, say French, Dutch and UK respondents.

Belgian, German and UK importers all stress the need to get NGOs behind sustainable tropical timber promotion. Their campaigning to combat deforestation, say Belgian respondents, has created the impression that they oppose the tropical timber sector. The trade needs to undertake a programme of communication and education to convince NGOs not just to support, but participate in and initiate verified sustainable tropical timber promotion and convince the public that buying it ‘is the right thing to do’.

Government procurement policy is also seen as vital in shaping the timber market place, and Netherlands respondents say their government’s policy has been a strong driver for sustainable tropical timber. Other nationalities feel their governments should be pressed to follow the Dutch example.

Promotion of sustainable tropical timber by respondents themselves is in general limited, with the view expressed that this is primarily the role of their national federations. Other to-dos to grow the sustainable tropical timber market, say respondents, are to reduce the price differential between certified and non-certified timber, increase trust in certification and improve availability and reliability of supply.

Survey recommendations:

  • Timber trade federations should support members in trading solely in timber  from responsibly managed forests and in formulating sustainable  purchasing policies
  • Governments should continue to implement and improve timber procurement policies
  • STTC could initiate more coordinated European level tropical timber promotion and link with other timber sectors in promoting use of sustainable tropical timber to end customers
  • Companies could do more to promote sustainable tropical timber products and advertise that they contribute to sustainable forest management
  • NGOs should be persuaded to promote the values of sustainable tropical timber
  • VAT and other tax measures could be used to make verified sustainable tropical timber more competitive versus non-certified.

Round tables to inform deforestation-free supply chain policy

A series of multi-industry remote round tables is being held to discuss European Commission (EC) action to curb import of commodities implicated in deforestation. Timber companies are among those invited to take part to share their experience and insights, including on the operation and impacts of the EU Timber Regulation in their industry and how similar regulation might operate in other import sectors.

The initiative has been launched by the Tropical Forest Alliance (TFA) and is being facilitated by natural resources sustainability consultancy EFECA.

The roundtables form part of the TFA’s Collective Action Agenda, which encourages industry stakeholders to engage in ‘action and collaboration needed to achieve the goal of zero-deforestation associated with commodity supply chains’. The round tables were originally intended to be held face to face around Europe, but due to the Covid-19 pandemic will now be online. They are running through April to June, with the next being held on April 30. Outcomes will include discussion papers, which will be shared with the TFA and the EC.

EFECA says the objective is to ‘develop a collective input from the private sector’ and other TFA partners across Europe on the objectives laid out in the European Commissions’ July 2019 ‘Communication on Stepping up EU action to protect and restore the world’s forests’. Each Roundtable will explore ways of achieving one of the five Communication priorities. These are to:

  • Reduce the EU consumption footprint on land and encourage consumption of products from deforestation-free supply chains in the EU
  • Work in partnership with producing countries to reduce pressures on forests and to ‘deforestation–proof’ EU development cooperation
  • Strengthen international cooperation to halt deforestation and forest degradation and encourage forest restoration
  • Redirect finance to support more sustainable land-use practices
  • Support the availability and quality of and access to information on forests and commodity supply chains and support research and innovation.

 

“We will also be exploring how to integrate and use lessons from the EUTR throughout this process” said EFECA Senior Consultant Rose McCulloch. “The EC are about to begin their Fitness Check of the EUTR, which includes a review of the options for forest risk commodities and stakeholder consultation. The aim is that the roundtables will run in parallel to that work and the EC’s official multi-stakeholder consultation, feeding in and supporting where appropriate.”

For details of round table dates, times and how to participate contact rose.mcculoch@efeca.com.

Take action now to combat tropical deforestation, urges report

Photo CIFOR

Government, business and consumers worldwide need to step up efforts now to combat loss of tropical forest, states a new report from IDH – The Sustainable Trade Initiative. It calls for radical and urgent change in patterns of consumption to support deforestation-free supply of key agricultural commodities, including tropical timber. In particular it urges governments and the private sector to increase the demand for certified sustainable products and materials.

The report, Urgency of Action to Tackle Tropical Deforestation, is billed as the first of its kind. It is blunt in its assessment of the current situation, describing the continuing rapid rate at which forest is disappearing as ‘alarming’. From 2010 to 2015, it states, around 122.29 million ha (Mha) of tropical tree cover was lost, 5% of the area of natural forests in 2010. The attrition also shows no sign of slowing down, with a further 12 Mha lost in 2018, the fourth-highest total since 2001.

“This destruction results in decreased livelihoods, loss of ecosystem services, and massive greenhouse gas (GHG) emissions,” says IDH. “Deforestation and other land use changes are considered the second biggest anthropogenic source of GHG emissions, and a major contributor to climate change.”

Forest degradation in tropical countries, states the report, is largely caused by demand for and production of soy, palm oil, beef, tropical timber, cocoa, coffee, wood pulp, and rubber.

The top five producers of each of these commodities account for the bulk of global production, but new sources of supply, and consequently deforestation hotspots are constantly emerging. While Brazil and Indonesia accounted for 71% of primary tropical forest loss in 2002, largely due to conversion of land to beef and soy and palm oil production, in 2018 this was down to less than half due to the rise in deforestation elsewhere. Paraguay, Argentina, and Bolivia saw forest cleared for soy and beef,

Malaysia for palm oil, while in the Democratic Republic of the Congo it has been converted to smallholder farming. Deforestation has also accelerated in Colombia, Côte d’Ivoire, and Ghana.

The report says European demand drives a significant part of this forest loss. Five European countries are among the top-10 with greatest deforestation risk in Brazil and  European soy imports alone correspond with over 175,000 ha of deforestation and 2.3 Mt CO2 of linked greenhouse gas emissions.  In 2016, Europe was also responsible for over 60% of global cocoa imports, about 50% of coffee and 30% of beef and wood pulp imports.

The majority of European direct imports of these commodities are accounted for by Belgium, Denmark, France, Germany, Italy, the Netherlands, Norway, Poland, Portugal, Spain, Switzerland, and the United Kingdom and this concentration, says IDH, is ‘a call to action for them to respond to deforestation linked to their imports’.

So far it describes European import of certified forest commodities (a proxy for deforestation-free imports) as mixed. While 74% of the palm oil imported for food into Europe is certified under the Roundtable for Sustainable Palm Oil (RSPO) scheme, only 25-32% of all EU tropical timber imports and a third of cocoa imports are certified.

IDH acknowledges that to achieve the goal of deforestation-free imports will require ‘immense efforts to drive demand and accountability in European consumer countries and to shift governance and agricultural practices in producer countries’. Certification is a key tool for achieving this, but must also be ‘bolstered by other interventions’.

“We need to continue efforts to increase governance, enforcement, and support effective policy in producer countries and scale jurisdictional approaches to create regional sustainability commitments,” says the report. “Financing must follow these best practices and large importers and governments have a role to play in fostering [supply chain] transparency.”

Consumer country governments, it adds, must also “catalyze adoption of sustainable sourcing” through consumer awareness campaigns, public procurement policy and support for import and processing industries.

“The bottom line is that overall demand for responsible, certified, and/or sustainable commodities remains far too low (less than a third for most commodities)… and the private sector can [also] contribute greatly to improving sustainability by increasing the demand for these commodities,” states the report. “The potential benefits of action are monumental – by just sourcing 100% verified sustainable tropical timber, the EU28 could positively impact (reduce degradation) in approximately 11.7 to 13.4 million hectares of tropical forest.”

It adds, in fact, that the timber sector could be a model for action to drive sustainable forest product sourcing more widely.

“EU-level action, including FLEGT and EUTR, could provide a roadmap for other commodities,” it says.

Read the full report here: https://www.idhsustainabletrade.com/tacklingdeforestation/

Potential and provisos for China’s ‘anti-illegal timber’ forest law

Photo timquijano

NGOs and other forest and timber sector stakeholders have welcomed China’s addition of a prohibition on buying illegal timber in its forest law. There are question marks about enforcement of the new provision, but it is being seen as potentially influencing the forest and timber sector practices of suppliers to China and dealing a blow against the international illegal wood trade. It would mean that over 80% of current total international tropical timber trade would be destined for countries with regulatory measures to eliminate illegal trade.

The final version of the revised forest law is expected to be introduced before China hosts the UN Conference on Biological Diversity in Kunming in October, but a draft was put out for review in October 2019.

A large part of the changes focus on China’s domestic forestry and timber industries. It includes provisions on forest tenure and lays down the objective of management of ‘public-welfare’ and commercial forest as being a healthy, high quality and effective forestry ecology system. It strengthens protection of China’s forest resources and bars cutting of natural forest. Its aim is also to promote an increase in Chinese forest cover and it imposes new controls on cutting volumes, licenses and timber transport.

It is article 65 of the law that focuses on illegal timber. It states that: “Timber trading and processing enterprises shall establish ledgers to record input and output of raw materials. Purchasing, processing, or transporting timber that is known to derive from illegal sources, such as illegally or indiscriminately logged forest, by any work units or individuals, are prohibited”.

“It’s potentially huge, a real game-changer for both the future of the planet’s forests and the battle against dangerous climate change,” said Faith Doherty, Forests Campaign Leader at NGO the Environmental Investigation Agency. “China is the world’s biggest timber importer and, for almost 20 years, its demand for raw materials for its vast wood-processing industry has been a massive driver of illegal logging around the world, especially in South-East Asia and Africa.”

Other commentators said that effective implementation of this new provision would require  closer coordination between Chinese customs and other government agencies than currently operates. “In general the prohibition carries potential risks of difficult enforcement, including not applying to traders, and low penalties,” said Jo Blackman, Head of Forests Policy at natural resources NGO Global Witness. She also said that the burden of proof in cases of alleged illegal timber would be on government departments, making it more difficult to secure prosecutions. The law also did not go far enough in establishing a legal framework requiring due diligence on the part of timber importers and traders, such as those operating in other markets, including the US, the EU and Australia.

Others, however, see it as a significant move in the right direction. China and the EU have been liaising on timber legality and market requirements for 11 years via their Bilateral Co-ordination Mechanism initiative, with the clear ambition from the EU perspective to bring China’s enormous trading muscle to bear in the war on illegal timber. “In all the discussions, it has been clear the Chinese authorities are aware that mandatory rules on legality of timber imports are the missing link,” said Dr Zhang Junzuo, Team Leader of the UK-China Collaboration on Forest Investment and Trade programme (InFIT).

The International Tropical Timber Technical Association (ATIBT) also responded positively to the forest law revision. “We’ve made great efforts to build a dialogue with Chinese operators working in Central Africa on the future of the sector and the need for sustainable management of the Congo Basin forests,” said ATIBT Managing Director Benoît Jobbé-Duval. “Our Chinese partners said development of the forestry law was important, even if means required to implement it would perhaps take a little time to mobilise it. We hope its implementation can be carried out effectively and within a reasonable timeframe. In the meantime, we will continue cooperation with our partners.”

ATIBT and STTC founder and funder IDH – The Sustainable Trade Initiative said that they would also closely monitor implementation of the forest law revisions.

According to the 2018 Annual Report of the EU FLEGT Independent Market Monitor, 62% (US$25.6 billion) of the total value (US$41.2 billion) of recorded tropical wood exports worldwide were destined for countries with regulatory measures to eliminate illegal trade, including the EU, Australia, Indonesia, Japan, Malaysia and the Republic of Korea, the USA and Viet Nam. The value going to unregulated markets was $15.6 billion, with 55%, or $8.6 billion, imported by China.

If China could be included among them, markets regulated for legality would account for over 80% of total international tropical timber trade.

Dutch broaden hardwood LCA horizons

Photo GWW Houtimport

Netherlands timber market development body Centrum Hout has posted latest hardwood Environmental Product Declarations (EPDs) and associated life cycle assessment (LCA) data online. The organisation is also discussing strategies for LCA work on African hardwoods with the International Tropical Timber Technical Association (ATIBT), a collaboration established at the STTC annual conference in Berlin last November.

The new EPDs for hardwoods used in civil engineering projects were put together by the Dutch Institute for Building Biology and Ecology (NIBE), which was commissioned by the Ministry of Infrastructure and Water Management in a joint programme with Centrum Hout for circular economic development and greater use of wood as a bio-based material.

Available for download at www.europeansttc.com/marketing and www.houtindegww.nl/LCA, they provide information on the timber, product and manufacturing process, with summaries of LCA outcomes, giving sustainability scores for comparison with different materials. Extended versions are available by contacting the Centrum Hout helpdesk, helpdesk@centrum-hout.nl.

The product categories comprise various dimensions of pile planking, road safety barriers, roadway signage portals or arches, and decking.

The timbers selected are the species with highest market share in the particular application from a specific source, so for pile planking Angelim vermelho representing South American hardwood, Robinia representing European hardwoods and Azobé representing African hardwoods.

For safety barriers, the EPD is for Azobé and Angelim vermelho, using steel connectors, and, for roadway signage portals, laminated Larch beams and columns.

Decking LCAs are for Angelim vermelho, representing South American hardwoods, Oak, representing European hardwoods and Azobé representing African.

The EPDs will feed into the Hout in de GWW project, which Centrum Hout has been involved in for four years with leading Dutch hardwood suppliers to promote use of hardwoods in civil engineering applications (read more here: https://www.europeansttc.com/blueprint-for-a-promotional-highway/). Efforts in the Netherlands to further develop use of timber continue.

And efforts in the Netherlands to further develop use of timber continue. On February 3 the Ministry of Infrastructure and Water Management, Centrum Hout and 11 of its members signed a ‘letter of intent’, with the aim of using 10% more wood (and other biobased materials) in civil engineering projects by 2030.

In conversations with ATIBT, Centrum Hout also shared its experiences in organising, surveying and analysing data for LCA.  “We addressed potential pitfalls and opportunities as well as some ideas on making the process as effective as possible,” said Mr Munck.

Conference flags need for pulling together on forest policy

The goal of February’s EU International Conference on Forests for Biodiversity and Climate Change, according to the introduction from Frans Timmermans, was to engage a wide range of stakeholders in development of European forest policy. “We need your collective brain power to get our strategy right,” he told delegates. Various STTC partners were present at the conference.

Only with input from as wide a range of perspectives as possible  and by achieving synergies between different interests, said the EU’s Executive Vice President, who is also responsible for the European Green Deal, could its policy achieve its aims in maintaining forests to combat climate change and mass species extinction.

Delegates reported the event, hosted by the EC Directorate for Environment, hitting many of the targets it set itself. Discussion was broad ranging, and, while there was emphasis on Europe, it did encompass the needs and value of forests worldwide, temperate and tropical.  From the timber sector’s perspective there was also encouraging recognition of its achievements in sustainability and legality assurance. Speakers highlighted forests’ value as a source of low carbon raw material, notably for construction, and the role of sustainable management in forest maintenance.

At the same time, there was concern about the lack of private timber and forest sector input. The event also did not entirely allay questions over whether different levels of European government were aligned on forest policy and pulling in the same direction.

Mr Timmermans left the 550-strong audience at the Brussels Conference in no doubt about the importance and urgency of combating deforestation. It was, he said, a central element of the EU’s new Green Deal strategy, the headline target of which is countering global warming by making the EU a net-zero greenhouse gas emissions economy by 2050.

Forests and their maintenance, he maintained, have a core role to play in curbing emissions and combating climate change as ‘the most natural and affordable and most self-sustaining form of carbon sink we have on the planet’.

Consumers needed to be made equally aware that richly biodiverse forests are also the front line for preventing the ‘sixth mass extinction’ of species, which, as much as climate change, could ultimately put humankind’s existence at risk. “It’s not about saving the planet … it’s about saving humanity” said Mr Timmermans.

Part of the solution, he said, was to make more efficient use of agricultural land to disincentivise forest clearance and for Europe to help other countries find economic alternatives to converting forest land to other uses.

He also highlighted the potential value of increasing use of timber from sustainable sources.

“It’s an economic opportunity of incredible dimensions if you do it right,” he said. “Look at the speed wood is used in sustainable construction in EU: that is a huge opportunity.   We need to create a balance between all these interests.

Delegate Nienke Sleurink, Programme Manager Markets at IDH- the sustainable trade initiative noted the focus of the Conference on European forests. “But this also made it clear we don’t have it all figured out in Europe, with the carbon sink of its forests decreasing.  Something to keep in the back of our minds when discussing sustainable forest management in the tropics.”

However, said Ms Sleurink, the event also underlined that the tropical timber sector has much to offer in discussions on potential legislation against imported deforestation. “It can share lessons learned – positive and negative – from its experience of due diligence under the EU Timber Regulation,” she said.  “The Conference also addressed partnerships with producing countries. Here again the tropical sector has lessons to share from its experience with FLEGT and VPAs.  In a panel discussion, the Chair of the Centre for Sustainable Development in Vietnam said the VPA process was a model that can be implemented for other commodities – in fact, they plan on doing this.”

Ms Sleurink said that, while represented by associations and lobbyists, private sector input at the Conference was generally weak. However, its few participants ‘were able to give clear examples of how their sectors were already moving’ and that there are ‘front running companies involved in initiatives and pilot projects that can be used as best practice’.

George White of the Global Timber Forum took a similar view. “There are huge and welcome efforts to bring stakeholders together to develop cohesive strategies and policies, but this process once again shows no sign of really being inclusive of   smaller companies, the engine room of the forest industries. It was good to see  European trade federations involved, but the view from the SME sector in producer countries and Europe was almost entirely missing. Solutions have to work for people and businesses at all scales.”

Mr White also remained unconvinced that all stakeholders were aligned on forests, biodiversity and climate. “If they pull together, the EC and EU will be a powerful force for good, if they don’t they will waste the opportunity,” he said.

GD Holz Head of Foreign Trade Nils Olaf Petersen saw Mr Timmermans mention of the rapid uptake of timber in construction and the consequent environmental benefits as a positive. “That said, I’d hoped the Conference would focus more on both protection of forests AND using them to our benefit. It is a case of use it, or lose it,” he said.  “And the issue of sustainability wasn’t discussed at all in my view.”

It was a move in the right direction, however, that the value of plantations, which account for 40-50% of forest products, was highlighted. “It countered the one-sided argument that plantations are bad – they also reduce pressure on primary forests, if set-up properly,”  said Mr Olaf Petersen

Other constructive comments, he added, included those from EC Director General Environment Astrid Schomaker that ‘illegal logging isn’t the driver of deforestation anymore’ and from another participant that greater use must be made of timber derived from ‘calamities’, such as storms, tree disease and insect infestation.

Mr White saw the decade ahead as critical for building actionable knowledge-based  forest policy and he welcomed the pragmatism of delegates in this respect. “It was good to hear many agreeing that the search for perfection in forestry projects can be the enemy of the good – too much navel gazing only serves to help the global thermometer rise.”