Greenpeace activists are famous for their headline-grabbing campaigns and the latest to hit the timber industry was the NGO’s demonstration outside a government office in October.
Wielding a “ban illegal timber” banner, activists chained themselves to a tonne of plywood at the entrance to Defra to protest against the UK’s trade in Chinese plywood allegedly manufactured from illegally sourced timber. The protest coincided with Greenpeace’s publication of the Partners in Crime report, which implicated a number of UK importers and merchants.
The Timber Trade Federation (TTF) responded immediately by calling a meeting with Greenpeace, the results of which will be the subject of a report to be issued shortly. Meanwhile, the TTF had already planned a special seminar, “Chinese timber: challenges and opportunities”, which was attended by 85 TTF members, consultants and market analysts.
Log imports
In his opening remarks, Peter Latham, chairman of Forests Forever, said the seminar was long overdue, if only because of the scale of Chinese imports into the UK. China is the largest importer of logs in the world and the second largest importer of forest products; in turn, it is the largest plywood producer in the world, turning out 21 million m3 in 2003 from about 6,000 plywood mills. It accounts for 20% of the UK’s tropical hardwood market – up from 8% last year and, with its fast-growing poplar plantations and high yield production, it shows no signs of slowing down.
Of course, the China factor is not peculiar to the UK: Kerstin Canby of Forest Trends, which has analysed the Chinese forest products industry for a number of years, told delegates that international demand for Chinese forest products is up 285% by volume (36.2 million m3) from 1997-2004 and 364% by value (US$13.1bn).
At present, a third of the volume of all forest products and two-thirds of the volume of timber products being imported by China are then exported. Furniture exports have risen by 400% from 1997-2004 while panel product exports have risen by a staggering 1,000%.
China’s key export markets are the US (accounting for 36%), Japan (15%), Hong Kong and the EU (both 14%).
As Ms Canby reported, since China imposed a logging ban on its forests in 1998, domestic production is currently unable to match domestic consumption. While the country’s ambitious plantation programme means it expects to lift its logging ban in 2015, imports into China are bound to continue, at least until then.
This avalanche of Chinese timber products has thrown up a whole range of challenges. “How do we ensure that timber products supplied from China are legally logged and traded and from well-managed forests when China is a major importer of logs and timber from forest rich areas of Asia Pacific, Africa and Russia, where governance is weak?” said Peter Latham.
Checking provenance
The key, as all the speakers at the seminar agreed, is for buyers to check the provenance of their imports thoroughly. Sam Lawson of the Environment Investigation Agency, which often operates under cover, said EIA believes China to be the largest buyer of stolen timber in the world.
“UK buyers should insist on FSC wherever possible, including chain of custody and third-party certification,” he said. “Take responsibility for your knowing your supply chains and don’t trust to the assurances of suppliers. Ask for documentation to prove that timber is legal and from a sustainable source and check the documentation with knowledgeable experts.”
The Tropical Forest Trust (TFT), an organisation that links businesses with responsible forest management, certainly comes into that category. And, encouragingly, TFT believes that the challenges emanating from China are not insurmountable.
As Scott Poynton explained, TFT’s optimism is based on its experiences with Vietnam which was trading in illegally sourced timber from Cambodia.
In Vietnam, through its “Good Wood, Good Business” policy, TFT helped its clients secure legal and sustainable supply – and improved forest management, to boot.
“You shouldn’t stop buying from these countries but should take responsibility for the products you are buying because you can’t rely on the systems in place in these countries,” said Mr Poynton. “The critical thing is to know with absolute confidence where your wood comes from – which stump in which forest.
“TFT members are increasingly buying from China and face the same serious issues as existed in Vietnam in 1999. TFT is opening an office in China in early 2006 and the key focus will be to implement Good Wood, Good Business. We have no doubt that China can be sorted – it’s about UK buyers taking responsibility for what’s in their product and using their leverage with Chinese suppliers. You have power as buyers – no factory wants to lose an order – but offer them help and training, just as TFT did in Vietnam.”
As Andy Roby, the TTF’s head of environment and corporate social responsibility (CSR), advised delegates, the UK timber industry does have the tools to deal with the challenges arising from trade with China. And it has the necessary incentives too, such as the UK government’s concentration on its sustainable procurement policy, the increasing focus on CSR by construction companies and their shareholders and international legislation such as CITES and FLEGT.
NGO campaigns also provide an impetus – welcome or not. “We want to establish timber as the sustainable building material… but every time a campaign strikes, we lose ground,” he said.
Code of Conduct
The trade’s response to negative publicity had been the TTF’s Code of Conduct, the Indonesian Action Plan, the Timber Trade Action Plan (verified legal timber from 147 mills in Indonesia, Malaysia, Gabon, Congo-Brazzaville and Cameroon) and the Responsible Purchasing Policy (RPP).
In trading with China, Mr Roby advised individual companies to assess all their suppliers and to link the risk assessment to their purchasing decision – “don’t just ignore it”.
“Build in independent auditing for credibility, find alternative evidence of legality and sustainability, provide feedback to your suppliers and give yourself enough time to search for alternative log sources,” he continued.
Echoing Scott Poynton’s message, Mr Roby said the next steps are to raise more awareness of the issues with Chinese suppliers and establish a purchasing policy for Chinese importers. A Timber Trade Action Plan for Latin America and China is in the pipeline.
“China is an opportunity,” he concluded.
