Indonesia denies charges of slashing plywood prices
Indonesia denies charges of slashing plywood prices
JAKARTA (JP): A war of words has erupted between the
Indonesian and the Malaysian plywood exporters following sharp
allegations that Indonesian producers had slashed prices to
undercut their Malaysian counterparts in international markets.
A. Tjipto Wignjoprajitno, the executive president of the
Association of Indonesian Wood Panel Producers (Apkindo), told
The Jakarta Post here yesterday that the Malaysian allegation is
baseless on the grounds that Indonesia had never sold plywood
cheaper than Malaysia.
On the contrary, Malaysian plywood exporters had earlier
started price competitions in the United States and European
countries by selling cheaper plywood products, he said.
"The difference between the prices of our 32-millimeter
plywood and Malaysia's similar products was between US$30 and $40
per cubic meter, which had forced us to abandon the markets," he
said. However, he added that Indonesian exporters had accepted
the move.
"We do not care because our delivery time, product quality and
grade is better than theirs," he added.
The Malaysian Panel Products Manufacturers Association (MPMA)
charged on Wednesday that Apkindo, after breaching a regional
pact not to undercut prices, did not bother to follow the
requirement.
Chai Fook Loong, the president of MPMA, was quoted by the
Singapore-based Business Times as saying: "After dropping the
bombshell, Apkindo is turning a deaf ear to the MPMA's call for a
roundtable meeting."
Chai said that Apkindo did not explain why it breached the
ASEAN pact and had ignored all agreements made by the MPMA and
the Philippine Plywood Association about the issue.
He alleged that Apkindo unilaterally chopped plywood prices on
July 4, after agreeing at the ASEAN Panel Products Federation
(APPF) meeting in Kuala Lumpur on June 30 not to resort to such
an action in the spirit of cooperation and solidarity.
ASEAN (the Association of Southeast Asian Nations) groups
Brunei, Indonesia, Malaysia, the Philippines, Singapore and
Thailand.
No talks
Indonesian timber baron Muhammad (Bob) Hasan, however, said
that participants of the APPF did not discuss the plywood price
thoroughly, adding that Indonesian plywood exporters always sell
its products at higher prices than Malaysia.
Hasan was quoted by the Jakarta-based Bisnis Indonesia daily
as saying that Indonesian wood panel exporters had fulfilled a
number of strict requirements, such as the Japan Agriculture
Standard and the Indonesian Plywood Standard, which cause the
Indonesian plywood to be better in quality and dearer in price
than Malaysian products.
"We don't want to sell cheaper than Malaysia," Tjipto
reiterated yesterday.
Hasan is a former chairman of APPF before handing in his two-
year-term chairmanship to Chai in June.
Tjipto yesterday showed a two-page communique of the Kuala
Lumpur APPF meeting, noting that it does not govern anything
about pricing.
The communique, however, aired APPF's concern over, "the
recent erosion of global plywood prices which was not caused by
an oversupply but the disruptive pricing policies of new
producers who are seeking a foothold in the international
markets."
Chai said that Apkindo's price cut was unkindest to Malaysia
as prices of plywood had plunged in China and the European
countries, two of Kuala Lumpur's main markets, by 27 percent and
16 percent respectively.
"Plywood importers, distributors and merchants regard these
price reductions as unnecessary," he said.
In a bid to find a solution, he added that MPMA would continue
with efforts to contact Apkindo "for another week or two" before
seeking government intervention.
As if knowing the proposal of Chai, Tjipto said that Apkindo
was also ready to discuss the issue with both the Malaysian and
the Philippine associations in what he called "the ASEAN
cooperative spirit." (09)