Two plywood companies have had their licences revoked by the Indonesian government for using illegal logs and for breaking production capacity limits.

The action against PT Wana Rimba Kencana in East Kalimantan and PT Benua Indah in West Kalimantan follows inspections by a new forestry watchdog called the Revitalisation of Forestry Sector Industries Task Force.

Wana Rimba was suspected of using illegal logs while Benua Indah was accused of increasing production capacity without permission from the Ministry of Forestry. Both companies are now being investigated by the police and attorney-general.

The ministry expects to take action against more companies once inspections are completed. By the end of February the task force will have inspected another five forestry companies in Kalimantan and Sumatra.