Trade restriction threatens ramin furniture producers

JAKARTA (JP): At least 40 furniture companies might have to close their operations following the government's recent decision to curb the sales of ramin (Gonystylus spp) wood in the country.

The Association of Indonesian Furniture and Handicraft Producers said here on Friday that the restriction would cause a a serious shortage in the supply of ramin, the main material used in the association's production of furniture.

"The restriction is really damaging the furniture industry, we might see some closures soon," the association executive director Sae Tanangga was quoted by Bisnis Indonesia daily as saying.

The government issued a decree on April 11 to ban exports of ramin wood and logs in an effort to curb illegal logging activities, which causes some Rp 6 billion (US$535,000) in losses to the state every month.

The sale of ramin in the domestic market is allowed but with a strict licensing procedure.

He said furniture companies could import ramin, such as those in Malaysia, Singapore, Taiwan and Hong Kong, but importing the wood for furniture production would be too expensive.

Ramin is one of the most popular types of wood in foreign markets due to its good quality. Logs can fetch US$1,000 a cubic meter. Furniture made from ramin is sold at between $2,500 and $3,500 a cubic meter.

Sae said about 90 percent of the furniture made from ramin was exported.

Indonesia's exports of furniture made from ramin reached about $350 million last year, which is about 20 percent of the country's total furniture exports.(05)