RI may lose share of Japanese plywood market
RI may lose share of Japanese plywood market
JAKARTA (JP): Indonesia may lose more of its share of the Japanese plywood market if appropriate measures are not taken to promote exports to Japan, an official says.
Koes Saparjadi, the attache for forestry affairs at the Indonesian embassy in Tokyo, said that Malaysia and Papua New Guinea, which have ambitious plans to boost their plywood industries, have the potential to grab the Japanese market away from Indonesia.
He said in his analysis, which was published by the Kompas daily yesterday, that Malaysia is expanding its plywood exports to Japan in line with its growing plywood industry.
The Malaysian government's decision in 1993 to ban log exports from Sabah, the country's major timber producing area, has improved the Malaysian plywood industry, he said.
PNG's ambitious 1993 plan to become one of major plywood exporters could also jeopardize Indonesian dominance.
Indonesia's share of the Japanese plywood market has been declining in the last five years despite an increase in export volume in 1993.
According to the data from the Japan Plywood Manufacturers Association, Indonesia's share steadily declined from a peak of 97 percent in 1989 to 96 percent in 1990, 95 percent in 1991, 93 percent in 1992, 84 percent in 1993 and 81 percent between January and October of 1994.
Marketing
Some analysts blame the decline on the Indonesian plywood producers' poor marketing strategy.
They said that the plywood producers' policy of maintaining high prices rather than high export volume made Indonesian plywood less competitive.
Saparjadi said Indonesian plywood manufacturers face a dilemma in maintaining their dominance of the Japanese market.
Increasing the export volume by lowering prices will not only cause financial losses but also environmental damage because an uncontrollable rise in exports could ruin forests.
On the other hand, raising export earnings by increasing prices will automatically reduce the supply, he said, adding that a supply shortage would encourage other plywood producers, like Malaysia and Papua New Guinea, to establish themselves in the Japanese market.
Indonesia's plywood exports, according to the Japanese Plywood Manufacturers Association's data, fell from three million cubic meters in 1989 to 2.76 million cubic meters in 1990. But it rose slightly to 2.87 million cubic meters in 1991 before dropping again to 2.77 million cubic meters in 1992. There was a surged to 3.44 million cubic meters in 1993. Plywood exports were only 2.80 million cubic meters in the January to October period of last year.
Saparjadi called on Indonesian plywood producers to revise their marketing strategy to benefit from the expected increased demand in Japan as the country rebuilds the earthquake damaged city of Kobe over the next two years.(hen)