Wood exports projected to increase to $10 billion
JAKARTA (JP): Minister of Forestry Djamaludin Suryohadikusumo is optimistic that annual exports of wood products can net at least US$10 billion in the next 10 years without having to rely on plywood.
Speaking to reporters after a meeting with Daijiro Hashimoto, the governor of Japan's Kochi province, the minister said that importer countries, such as Japan, would have to adjust in the future to Indonesia's changing forest conditions and sustainable development policy, which may call for cutbacks in the timber supply used for plywood production.
According to the Central Bureau of Statistics, Indonesia's exports of wood products declined to $5.19 billion in 1994 from $5.5 billion in 1993. Of last year's revenues from wood exports, $3.71 billion came from the sale of plywood, $509.6 million from sawn timber and $964.5 from other wood products.
Djamaludin said that, in the future, earnings are expected to come mainly from medium-density fiber (MDF) boards and laminated vinyl lumber (LVL) boards.
"Over the next 10 to 25 years, the sizes of large timber areas will decrease and many of them will be used mainly as protected forests and national parks," he said.
Panel boards would no longer be made from large trees but from smaller, faster-growing types of trees cultivated by concessionaires, which would first be made into pulp before being processed into boards, he said.
Impact
Djamaludin said he was optimistic that the substitution of plywood by other forms of wood panels would not have a negative impact on exports, which he predicted would continue to grow.
Indonesia, which currently produces 10 million cubic meters of plywood per year, supplies about 80 percent of the world plywood market.
According to the Central Bureau of Statistics, exports from wood products, which mostly consist of plywood, currently account for 13 percent of Indonesia's overall annual export earnings.
Plywood export prices, which were recorded in February as ranging between $370 and $1,200 per cubic meter, reached an average of $474 in 1993 but dropped to $457 in 1994.
Revenues from plywood exports also dropped by nearly 12 percent from $4.22 billion in 1993 to $3.71 billion last year.
While the Indonesian Forestry Society (MPI) blames the export decline on the economic recession of importer countries -- which also include South Korea and the United States -- a number of analysts and buyers consider it to be due to the trade policies practiced by the Indonesian Association of Wood Panel Producers (Apkindo).
Apkindo officials have denied this.
Under current regulations, all international transactions involving Indonesian plywood must be conducted through Apkindo, its trading arms and its appointed distributors.
Despite Djamaludin's statement, Apkindo chairman Mohamad Hasan insisted yesterday that plywood would continue to play a major role in exports in the future because, he said, plywood and MDF were incomparable materials.
During a separate meeting with Governor Hashimoto later yesterday, Hasan said that Indonesia's timber production could still be increased. "It is even possible to make (timber) planting more rapid than felling," he said.
The MPI, also chaired by Hasan, predicted earlier this year that plywood export prices would climb again after exporters recovered from an economic recession and could reach a record high of $8 billion this year.(pwn)