Exports of forest products estimated at $8.25b this year
Exports of forest products estimated at $8.25b this year
JAKARTA (JP): The Indonesian Forestry Society (MPI) estimates
that foreign exchange earnings from exports of wood and other
forest-related products will reach US$8.25 billion this year
despite sluggish sales in this year's first quarter.
MPI's chairman Abbas Adhar said yesterday that MPI was
optimistic that the export target could be achieved because the
overseas demand for Indonesia's forest-related products would
likely increase in the second quarter.
"Overseas demand for Indonesian wood and wood-related products
has been improving since April, especially for plywood, pulp and
final wood products. According to Apkindo, plywood producers will
be unable to take new orders because their production output is
fully booked," Abbas said after MPI's national meeting yesterday.
Abbas said that overseas demand for Indonesian plywood had
picked up again due to the recovery of some major Asian buyers,
such as Japan, and better prospects in the United States and
European countries.
Abbas said the export value of wood and wood-products
(excluding the log exports and flora and fauna exports) is
targeted to reach $7.7 billion, up by 4 percent compared to $7.4
billion in 1997.
He said that the amount comprises of pulp and paper exports
worth $3 billion, wood panel exports worth $3 billion, furniture
and handicraft exports of $500 million, sawn timber exports of $1
million, rattan and rattan product exports worth $200 million,
and export of processed wood worth $1 billion.
If exports of logs and flora and fauna are included, the total
foreign exchange earnings will reach $8.25 billion this year, he
said.
This year, he added, MPI members planned to export 3 million
cubic meters of logs worth $300 million and flora and fauna worth
$250 million.
Last year, pulp and paper exports stood at $1.93 billion, wood
panel exports at $3.89 billion, processed wood exports at $879
million, sawn timber exports at 126 million, furniture and
handicraft exports at $527.2 million and rattan and rattan-
product exports at $195 million.
Abbas said that the sharp increase in the export value of pulp
and paper was due to the 62.5 percent increase in pulp price to
the current $650 per ton up from $400 per ton last year.
"The decline in the export value of wood panel products was
due to lower plywood prices caused by a lessened demand from
Indonesia's two main buyers, Japan and South Korea, which are
experiencing economic downturns," he said.
Plywood, a wood panel product, is Indonesia's second largest
non-oil and non-gas foreign exchange earner after textiles and
textile products.
MPI, the federation of nine forestry-related organizations,
was led by timber tycoon Mohammad "Bob" Hasan for 12 years before
he resigned in March.
The organization has been widely criticized for their crony-
capitalism and rent-seeking practices.
Abbas said that MPI has been implementing its reform program
since February by abolishing several levies considered burdensome
to forestry companies and gradually revising its statutes and
management system.
He said that there would be a major reshuffle in MPI's
management which was decided on at the national meeting in order
to restore MPI's image, which is still considered to be under
Hasan's power.
"Pak Bob has pledged that he will no longer interfere in MPI's
business," he said.
Abbas added that MPI would remain in existence despite the
establishment of a rival forestry society advocating reforms,
called MPI Reformasi in the sector.
"It is a free competition. Businesspeople will look and choose
to join the better association and they are free to do it. So,
let's see," he said. (gis)