1. CENTRAL AND WEST AFRICA

 Fuel shortages now the issue
Operators in Southern Congo and Gabon are struggling to maintain production due to heavy rain. In contrast, in Cameroon and the RCA it is the dry period which is expected to run to the end of June.

Operators in the RCA and Cameroon continue to suffer shortages of fuel which is affecting road transportation. In Gabon there is no fuel problem however, operators have to pay CFA1,050 per litre while at gas stations the price is CFA675 per litre.

Trucking is especially tough at present where the rain is heavy and because of the long distances to the ports, shipments can be delayed. Some operators in Congo are trucking about 1,400KM to Pointe Noire or by river to Maloukou and from there by train to Pointe Noire.

Independent operators suffer even when rail service resumes
The disruption of the rail service in Gabon has created a major problem for the independent operators. When the rail service resumes priority will be given to the mining companies and millers in the GSEZ, other operators, if they cannot secure rail wagons, are faced with trucking logs to Owendo Port, which sometimes means trucking for 650 km.

Substantial okoume business with the Philippines
Mills in the Philippines are major buyers of sawn okoume and their purchases are substantial and the flow of orders is steady. Buyers for the Chinese market are slow to return in force but there continues to be a steady flow of orders for ovangkol, beli and okan sawwood but demand for okoume is weak. Importers in Vietnam are still buying tali but the volumes requested have been declining.

Pre-ban log stocks almost shipped out
The authorities in Congo allowed the export of logs cut before 1 January under tight supervision but the expectation is that around June there will be no more log stocks to ship. Equatorial Guinee continues to allow the export of logs and sawnwood through Port Bata.

Concession termination report now official
Reuters has reported on, what is now, an official DRC ministerial commission report which recommended terminating several forest concession contracts. The commission report recommends the termination of 30 out of 82 logged forest concessions. Of these, 22 are contracts for logging and eight are conservation contracts.

Another 36 contractors were given three months to regularise their business after the commission found certain taxes had not been paid.

See:https://www.reuters.com/world/africa/congo-commission-recommends-terminating-30-forest-concessions-2023-04-11/

Through the eyes of industry
The latest GTI report lists the challenges identified by the private sector in Congo and Gabon.

Seehttps://www.itto-ggsc.org/static/upload/file/20230414/1681442042214477.pdf 

2. GHANA

 Port activity slow - import volumes down
The Executive Secretary of the Importers and Exporters Association of Ghana (IEAG), Samson Asaki Awingobit, has expressed concern over the recent low volume of traffic at the country’s ports. According to port agents, they have little business at present and that there has been a decline of activities at the ports since mid-last year.

The IEAG attributed this to the new policies of the Ministry of Finance and the Ghana Revenue Authourity (GRA) which included the revisions of the benchmark policy in March 2022, increased value added taxes in the 2023 budget statement, the introduction of new taxes and the increased shipping costs.

Data from the port authority showed that container traffic dropped by 20% to 1.24 million 20-foot equivalent units (TEUs) in 2022 from the 1.56 million TEUs recorded in 2021.

See: https://thebftonline.com/2023/04/19/ports-traffic-drop-is-affecting-our-businesses-freight-forwarders/

Economy expanded but manufacturing contracted
Provisional estimates from the Ghana Statistical Service (GSS) indicate that Ghana’s economy expanded by 3.1% in 2022, lower than the 3.7% forecast by government. This is below Ghana’s average GDP growth of 5.0% pre-Covid-19. In 2021, during the Covid-19 pandemic the economy grew by 0.9%.

In 2022 the manufacturing sub-sector contracted (-2.5%), while the Agriculture sub-sector expanded by 4.2% with Forestry recording the lowest growth at 1.7%.

The Director at the Institute of Statistical, Social and Economic Research, (ISSER) Professor Peter Quartey, attributed the poor performance of the industrial sector to high inflation and the high cost of doing business in the country in 2022. Industries in Ghana face high interest rate, high utilities tariffs and these undermine -competitiveness.

See: https://www.myjoyonline.com/poor-industry-performance-in-2022-due-to-high-cost-of-doing-business-prof-quartey/ & https://www.myjoyonline.com/economy-expands-by-3-1-in-2022-gss/

Secondary wood products export climb
According to the Timber Industry Development Division (TIDD) wood product exports in the first two months of 2023 totalled 45,312 cu.m compared to the 44,238 cu.m over the same period in 2022. Export earnings in the first two months of this year were Eur19.92 million compared to Eur19.26 million over the same period in 2022.

The data showed that the contribution of primary products, secondary products and tertiary wood products in the first two months of the year were 8.3%, 87.1% and 4.6% respectively.

Primary Products, comprising billets and teak logs earned Eur1.23 million from exports of 3,766cu.m in the first two months of 2023. This was a decline of almost 30% in value and a drop of 35% in volume.

Secondary wood products which comprised sawnwood, plywood, veneer, boules and briquettes formed the bulk of the country’s wood export generating Eur17.60 million from a volume of 39,482 cu.m in the first two months of this year. There was a 7.4% increase in the value of exports and a 7% increase in volumes.

Tertiary wood products such as mouldings and dowels earned Eur1.08 million from a volume of 2,064 cu.m in the period reviewed. This represented a growth of 27% in volume but a drop of almost 4% in volume.

The leading exporters in early 2023 included Samartex Wood and Plywood, Multimodal Freight Services, Logs and Lumber, Benediction Company and Miro Forestry Ghana.
The top export markets were India, United Arab Emirates, United States, Belgium and Egypt.

Ghana’s Carbon market ripe for investment
Ghana became the second country in Africa after Mozambique to receive payments (US$4,8 mil.) from the World Bank’s Forest Carbon Partnership Facility (FCPF) for reducing 972,456 tonnes of carbon emissions from deforestation and forest degradation.

This followed a successful study in 2020 after which the country has started operating a Carbon Market Office (CMO) to trade. Dr. Daniel Tutu Benefoh, Ghana’s Focal Point at the United Nations Framework Convention on Climate Change, made this known to the media.

He said the mandate of the CMO is to ensure that public and private project developers are provided the regulatory support and guidance on the rules and requirement of the business.

The CMO Secretariat was established to provide administrative and technical services to the public and support the implementation of the Ghana international carbon market and non-market approaches framework.

See: https://gna.org.gh/2023/04/ghanas-carbon-market-ripe-for-investment/

3. MALAYSIA

 Positive oulook for economy
Malaysia’s trade surplus will continue to support the country’s growth this year despite the expectations of softening exports in the months ahead according to Nazmi Idrus at CGS-CIMB Securities a research firm. Idrus said his company remained positive on Malaysia’s 2023 full-year trade balance outlook in the months ahead. CGS-CIMB maintained its 4.4% year-on-year GDP growth forecast for 2023.

See: https://www.pressreader.com/malaysia/the-borneo-post/20230424/282497187971386

Sustainable Timber Towards 2030 and Beyond
An international conference was organised by the Malaysian Timber Certification Council (MTCC) and the Institute for Environment and Development (LESTARI), Universiti Kebangsaan themed “Exploring future frontiers as platforms to share research outcomes on timber certification”. The Conference focused on three main themes:

(i) Mainstreaming Timber Certification for Sustainable Forest Management, Industry and Trade

(ii) Initiative for Sustainable Future with Timber Certification focused on other initiatives that support meeting the requirements for certification of forest management and chain of custody as well as to ensure the effectiveness of sustainable practices in the forestry and timber industry in Malaysia.

(iii) Complementarity in Certification for Sustainable Timber Towards 2030 and Beyond

See: https://www.responsiblewood.org.au/highlights-from-the-international-conference-on-timber-certification-in-malaysia/

EU withdrawing from the global marketplace - Minister
After the EU member states voted to approve the negotiated deal on the EU’s Deforestation Regulation, Fadillah Yusof, the Malaysian Plantation and Commodities Minister, said it is disappointing to witness the EU withdrawing from the global marketplace and erecting protectionist barriers.

He is reported as saying “This move is woefully misguided, especially as the Asean and Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) groupings are gaining in influence and attracting new partners from around the world”.

See: https://www.theedgemarkets.com/node/664210

In addition to the exports reported above, in the first quarter 2023 there were exports of furniture and parts, 429,000 units compared to 626,000 units in 2022.

4.  INDONESIA

 Contribution from forestry to GDP can be increased
The Minister for the Economy, Airlangga Hartarto, has stated that the forestry sector's contribution to GDP at 0.66% in 2022 should be increased and the carbon trade may offer opportunities. He added that Indonesia’s forestry development policies are aimed at maximising benefits for people while maintaining forest functions.

He said the government continues to implement its Social Forestry policy that opens up opportunities for communities living around the forest to apply for forest area management rights.

In related news, Airlangga met with German Minister for Economic Affairs and Climate Action, Robert Habeck, to discuss a ‘green economy’ sector. Airlangga said Indonesia and Germany had sealed business agreements in various sectors such as energy transition, downstream industries and accelerating the completion of the Indonesia-EU Comprehensive Economic Partnership Agreement (IEU-CEPA) especially related to flexibility in sustainability issues.

One of the issues discussed with Minister Habeck was related to the European Union's deforestation regulation.

According to Airlangga this will make it more difficult for Indonesia to export commodities such as palm oil, cocoa, coffee and timber to the EU. Airlangga asked Germany to help encourage cooperation in recognising standards that have been implemented in Indonesia.

In terms of industrial downistreaming, especially mining, Airlangga emphasised that Indonesia is open to foreign investment in order to increase added value.

See: https://en.antaranews.com/news/278475/contribution-from-forestry-sector-to-gdp-can-be-increased-minister

and
https://www.msn.com/id-id/ekonomi/ekonomi/menko-airlangga-temui-menteri-iklim-jerman-bahas-aturan-deforestasi-ue/ar-AA19ZCDF#image=1

Philippines and Indonesia partnership on reforestation
Indonesia and the Philippines are working on a bilateral partnership for a major reforestation project which may catalyze net zero and carbon market development in the ASEAN region.

Indonesian Chamber of Commerce and Industry (Kadin) chairman and ASEAN-BAC 2023 chairman, Arsjad Rasjid, said the reforestation partnership was among the projects being pushed by the ASEAN Business Advisory Council (ASEAN-BAC) this year.

Indonesia has 91.2 million hectares of forest while the Philippines has 23.3 million hectares. With the growing demand for carbon credits globally the reforestation partnership presents an opportunity for both countries.

See: https://dinsights.katadata.co.id/read/2023/04/13/indonesia-philippines-work-on-large-scale-reforestation-project

Exports topped US$23 bil. in March
The value of Indonesia's exports in March 2023 reached US$23.50 billion, up 10% month-on-month according to Statistics Indonesia (BPS).

At a press conference Deputy for Methodology and Statistical Information at BPS, Imam Machdi, reported that in each of the past three years month-to-month export growth in March has always increased. However, the increase in March this year was not as high as in 2022 and 2021. The growth in March was supported by an increase in the exports of raw minerals as well as the iron and steel industry.

See: https://swa.co.id/swa/trends/economic-issues/ekspor-indonesia-maret-2023-capai-us2350-miliar

Economic growth below 5% in first quarter
The Executive Director of the Center of Reform on Economics (CORE) Indonesia, Mohammad Faisal, forecast that Indonesia's economy will record less than 5% growth in the first quarter of 2023.

According to CORE the projected growth will be supported by household consumption and investment. Household consumption is estimated to still account for half of the economic growth while investment is projected to contribute more to economic growth this year.

See: https://en.antaranews.com/news/278559/see-economic-growth-dipping-below-5-in-q1-core

Through the eyes of industry
The latest GTI report lists the challenges identified by the private sector in Indonesia.

See: https://www.itto-ggsc.org/static/upload/file/20230414/1681442042214477.pdf

5. MYANMAR

 Efforts to de-escalate violence
24 April marked the second anniversary since ASEAN agreed on a Five Point Consensus in response to the military coup in Myanmar, sadly the Myanmar military has ignored this opportunity for peace in the country. Amnesty International has assessed ASEAN’s five point consensus and its conclusions have been published;
“Myanmar: ASEAN needs to address its failing approach to the crisis in Myanmar following the military coup”

In relate news, the Bangkok Post has reported that government representatives from Myanmar and its neighbours met recently in New Delhi in an effort de-escalate the violence in the country. The New Delhi talks were a follow-up to an earlier meeting held in Thailand, the so-called Track 1.5 dialogue.

See: https://reliefweb.int/report/myanmar/myanmar-asean-needs-address-its-failing-approach-crisis-myanmar-following-military-coup

and
See: https://www.bangkokpost.com/world/2557711/secretive-talks-on-myanmar-held-in-india

Power supply a challenge
Prime Minister, General Min Aung Hlaing, has been reported as saying that securing an adequate electricity supply is a major challenge

An editorial in the state run newspaper lays the blame on those who have destroyed power plants and power lines. All sectors, including the timber industries are facing a serious power shortage and operating generators for industial production is far too expensive.

Most of the industries in Yangon area are supplied only four hours in a day. The residential areas in Yangon are faced with interrupted power supplies sometimes for eight to twelve hours daily.

The long term power issue in Myanmar has now become problematic as the Swedish/Finnish engineering services supplier AFRY has withdrawn from Myanmar’s hydropower projects. AFRY was working on 13 hydropower projects.

See: https://www.irrawaddy.com/news/burma/european-dam-specialists-withdraw-from-myanmar-amid-rights-concerns.html

Trade deficit
According to the Ministry of Economy and Commerce the trade deficit was over US$774 million at the end of the fiscal year despite the target of having a trade surplus of US$1,500 million dollars in the 2022-2023 fiscal year.

In the 2022-2023 fiscal year (April to March) exports were valued at US$16.575 billion. The value of imports was US$17.349 billion. Myanmar exports agricultural products, animal products, fishery products, mining equipment, forest products and industrial goods.

6. INDIA

 Surge in Covid infections
India recorded over 18,450 new Covid cases in the period 26 March to 1 April, a doubling of the number in the previous seven days and the number of cases continues to rise. A new variant of Covid-19 named “Arcturus” is said to be behind the surge of infections. But an Omicron sub-variant strain is on the verge of devastating the country as cases have soared 13-fold in the last month.

India's health ministry launched drills this week in an attempt to see if hospitals are prepared to deal with a possible influx of patients following the rise in cases.

See:https://www.independent.co.uk/news/health/arcturus-new-covid-variant-india-uk-b2319005.html

Timber price indices trend up
The annual rate of inflation based on all India Wholesale Price Index (WPI) in March was 1.34% compared to 3.85% recorded in February 2023. The decline in the rate of inflation in March was due to a fall in prices of basic metals, food products, textiles, non-food articles, minerals, rubber and plastic products, crude petroleum and natural gas and paper and paper products.

Out of the 22 NIC two-digit groups for manufactured products 12 groups saw increased prices while 9 saw a decline and one group remained unchanged.

The increase in prices was mainly contributed by machinery and equipment, other transport equipment, leather and related products, electrical equipment; fabricated metal products and other manufacturing.

The indices for wood panels, sawnwood and veneer sheets all rose in March.

See: https://eaindustry.nic.in/pdf_files/cmonthly.pdf

Growing demand for US hardwoods
US hardwood exports to India were at an all-time high in 2022 with the value of hardwood sawnwood and veneer exports totalling US$8.62 million according to the American Hardwood Export Council (AHEC).

The value of sawn hardwoods shipped from the US to India increased by 13% US$6.902 million (up from US$6.120 million in 2021) but were down by around 4% in volume compared to 2021. Direct exports of US hardwood veneers to India were worth US$ 1.716 million. India has seen a growing demand for US hardwoods in recent years. AHEC participated at Delhiwood hich included 12 US based sawn hardwood exporters.

The top six American hardwood species exported to India last year were Hickory (2,581cu.m), White Oak (3,173cu.m), Red Oak (2,334 cu.m), Ash (514 cu.m), Walnut (214 cu.m) and Maple (428 cu.m). Significant increases were seen in the value and volume of exports of Red Oak, Maple, White Oak and Walnut.

Roderick Wiles, AHEC Regional Director, is quoted by Miller Wood Trade as saying “Increasing certification requirements and the restricted and deteriorating quality of supply of domestic species is driving Indian furniture manufacturers to look at viable alternative hardwood species not only for the domestic furniture and interiors market but also for re-exports of value-added product.“

See: https://millerwoodtradepub.com/u-s-hardwood-exports-to-india-reach-all-time-high/

Plywood sales steady despite weakening housing market
Despite weakened demand for plywood new construction is sustaining production by door and film faced shuttering plywood factories. PlyReporter says demand has improved in all product categories including LVL, H beams, non-densified and densified plywood.

Since the end of 2022 construction work slowed in many cities with 37 districts in the Indo-Gangetic Plain (IGP) being identified as air pollution ‘hotspots’, including nine districts in Delhi and those of Noida, Gurgaon, Faridabad and Ghaziabad and there was a considerable drop in orders placed with plywood manufacturers. PlyReporter says as the air quality has improved construction work has resumed helping lift demand for plywood.

In other news, PlyReporter has said the 2023 government budget will boost demand for plywood in the construction sector as plywood has been accepted for use tier 3 and rural markets as traditional shuttering wood has become more expensive.

See: https://www.plyreporter.com/article/123486/booming-real-estate-helping-film-faced-plywood-demand

Urban housing shortage
According to a report from the Ministry of Housing and Urban Poverty Alleviation (MHUPA), the urban housing shortage in India is currently estimated at around 19 million. This gap is expected to further widen to an estimated 38 million homes by 2030, largely due to the rising population and increased urbanisation.

India built 5.28 million houses through the ural housing scheme in fiscal 2023, up 25% from a year earlier. The country proposes to build 5.73 million houses under the Pradhan Mantri Awas Yojana (PMAY-G) in order to meet the overall target of building 29.5 million houses under the scheme. Under the PMAY-G, the central government bears 60% of the construction cost in most states. However, this contribution goes up to 90% for north-eastern and hilly states and to 100% for Union territories.
See: https://economictimes.indiatimes.com/industry/services/property-/-cstruction/rural-housing-under-flagship-scheme-rises-25-in-fy23/articleshow/99648976.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

India-made containers
The Covid pandemic disrupted global trade and also impacted the supply of shipping containers. Because there were only a few companies manufacturing containers and because global output dropped demand exceeded supply. India, as other countries, faced problems securing containers and exports were delayed.

In response a decision was made by the government to help Indian container manufacturers by providing them with advance orders channelled through the Container Corporation of India (COCOR) which previously relied on China for most of its containers. Now, CONCOR will be sourcing 8,000 containers from domestic companies.

See: https://www.oneindia.com/india/india-made-containers-a-success-story-3510171.html?story=3

Import cost driven up by weak rupee
The Indian rupee ended 2022 as the worst-performing Asian currency having fallen 11% against the US dollar, its biggest annual decline since 2013. The rupee is anticipated to weaken against the US dollar in the first half of 2023 because of concerns about global inflation and the risk to the Indian economy. However, recovery prospects appear brighter in the second half as crude oil and other commodity prices should fall.

See: https://www.compareremit.com/money-transfer-tips/usd-to-inr-forecast-2023/

Falling productivity caused by high temperatures
Extreme heat as well air pollution are a health hazards and a recent study from the University of Cambridge warns that heatwaves were weakening India’s efforts to meet its Social Development Goals as extreme heat could lead to a 15% decline in outdoor working capacity, reduce the quality of life for up to 480 million people and cost 2.8% of GDP by 2050.

Falling productivity caused by extremely high temperatures could already be costing India 5.4% of its GDP according to the Climate Transparency Report.

See:https://www.aljazeera.com/news/2023/4/20/indias-heat-putting-economy-development-goals-at-risk-study

and
https://www.climate-transparency.org/

7. VIETNAM

 Wood and Wood Product (W&WP) trade highlights
 Over the first 4 months of 2023 W&WP exports were valued at US$4 billion, down 28.5% against the same period in 2022. In particular, WP exports contributed at US$2.6 billion, down 36.7% over the same period in 2022.

 Vietnam's imports of wood raw material (logs and sawn-wood) in April 2023 is estimated at 432,300 cu.m worth US$155.6 million, up 15.4% in volume and 15.0% in value compared to March 2023.

 However, compared to April 2022 imports are down 16% in value and down 22% in value.

 In the first 4 months of 2023, imports of wood raw material reached 1,309 million cu.m, worth US$474 million, down 25.4% in value and down 29% in value over the same period in 2022.

 Vietnam's exports of NTFPs in March 2023 earned US$62.53 million, up 10.4% compared to February 2023 but down 30% compared to March 2022.

Overall, in the first quarter of 2023 Vietnam's exports of NTFPs amounted to US$164.95 million, down 37.7% over the same period in 2022.

W&WP exports declining
W&WP exports during April 2023 are forecast to reach US$1.2 billion, up 5.5% compared to March 2023 but down 24.5% compared to April 2022.

WP exports, in particular, are estimated at US$820 million, up 6% compared to March 2023 but down 28% compared to April 2022. Over the first 4 months of 2023 W&WP exports are estimated at US$4.0 billion, down 28.5% against the same period in 2022. Of this, WP exports are estimated at US$2.6 billion, down 36.7% over the same period in 2022.

With the current growth rate W&WP exports in the first half of 2023 are predicted to drop around 30% compared to the same period in 2022.

Export categories
In the first 3 months of 2023 wooden frame chairs were the leading export product, contributing US$593.3 million, year-on-year down 36%; followed by wood chips reaching US$526.3 million, up 14.6%; living and dining room furniture US$446.2 million, down 46%; wood-based panels and flooring US$359.8 million, down 28%; bedroom furniture US$330.6 million, down 43.4%.

Amongst product categories exported in the first 3 months of 2023, only wood chips and wood pellets had a positive growth rate.

Export growth of these types of wooden products is due to the increased demand. However, the expansion of wood chip and pellet exports cannot compensate for the downturn in the entire sector.

US imports down - Japanese imports up
Since W&WP exports to the US account for around half of the total W&WP exports the decline in demand in this market led to the serious drop of total exports in the first 3 months of 2023. Statistics show that in the first 3 months of 2023 W&WP exports to US were valued at US$1.4 billion, down 42.3% year-on-year.

The second largest market, Japan, imported W&WPs worth US$428.5 million in the first quarter of 2023, up 8,8% compared to the same period in 2022. Against the background of a sharp decline in global demand growth in the Japanese market is highly appreciated.

However, to boost further the exports to the Japanese market Vietnamese companies have been advised to create links with Japanese partners to diversify furniture designs and strengthen trade promotion. W&WP produced in Vietnam are exported to a number of other markets including China (US$374.2 million, up 6% over the same period in 2022), South Korea (US$207.7 million, down 17%), EU (US$121.1 million, down 40%); UK (US$41.7 million, down 42%).

Wood sources in the first quarter 2023

Domestic sourcing
In the first 3 months of 2023 the area of newly planted forest plantations is estimated at 38,700 hectares, up 5% over the same period last year. Harvested wood volumes reached 3,349,200 cu.m, up 4%.

Imports
According to preliminary statistics, Vietnam's imports of logs and sawnwood) in April 2023 are forecast at 432,200 cu.m worth US$155.6 million, up 15.4% in volume and 15.0% in value compared to March 2023;

However, compared to April 2022 imports are forecast to be down by 16% in volume and 22% in value.

In the first 3 months of 2023 the volume of wood imported from major sources including the EU, China, USA, Thailand, Laos, Chile and New Zealand declined year on year while imports of tropical hardwoods from Cambodia, Congo, Malaysia, Angola and Indonesia increased.

Wood imported from the EU accounted for 14.4% of total wood imports reaching 134,300 cu.m, worth US$40.8 million, down 18% in volume and 20% in value over the same period in 2022.

Imports of wood from China decreased by 31% in volume and 36% in value over the same period in 2022, reaching 105,900 cu.m, worth US$51.7 million and accounted for 11% of total wood imports.

Imports of wood from other markets fell compared to the same period in 2022: from the US decreased by 7%; Thailand decreased by 25%; Laos decreased by 12%; Chile decreased by 22.7%; New Zealand fell 21%.

In contrast, imports of tropical hardwood from Cameroon increased by 6% in volume and 10% in value over the same period in 2022, reaching 144,600 cu.m, worth US$62.6 million and accounting for 16% of total wood imports.

Imports from Congo were up 3%; Malaysia increased by 89%; imports from Angola increased by 26%; Indonesia increased by 67% and imports from Canada increased by 17%.

Imported species
In the first 3 months of 2023 the volume of major species imported into Vietnam, such as tali, pine, ash, oak, rubberwood, teak birch, doussie and padouk declined compared to the same period in 2022.

Tali dominated imports with a 13% share of total imported wood in the first 3 months of 2023 reaching 121,300 cu.m, worth US$49.6 million, down 7.3% in volume and 6.7% in value over the same period in 2022.

Pine imports decreased by 51% in volume and 61% in value over the same period in 2022 (101,300 cu.m, worth US$22.7 million), accounting for 11% of the total wood imports.

Ash imports decreased by 1% in volume and 12% in value over the same period in 2022, reaching 86,600 cu.m, worth US$22.3 million.

In addition imports of some other species dropped in the first quarter of this year (birch decreased by 26%, doussie by 22%, padouk by 8%, eucalypt by 74%, spruce decreased by 35%).

In contrast, oak imports in the first 3 months of 2023 increased by 1% in volume but decreased by 7% in value over the same period in 2022, reaching 51,800 cu.m, worth US$29.0 million or 5.5% of total imports.

Exporters faced a severe challenge in the first quarter 2023
Vietnam's exports of wood and wood products are faced severe challenge in the first 3 months of the year with a year-on-year drop of 30%.

To promote W&WP exports, wood businesses have been advised to look for new customers available in various markets, such as Japan, China, South Korea, the Middle East rather than just focus on the US and EU markets.

In this recessionary time Vietnamese wood product manufacturers have been recommended to re-structure production lines, invest in new equipment and technology to reduce labour costs. They have been advised to increase the use of supplementary materials, including metal, stone, glass, fabric etc. to diversify their raw material inputs and increase product aesthetics towards meeting customer demands.

Fortunately, freight and logistic rates have been significantly reduced which could help the wood industry in Vietnam regain export momentum from the third quarter of 2023.

Preparing for the EUDR
The United Nations Development Programme (UNDP) and the Vietnam Forestry Development Department under the Ministry of Agriculture and Rural Development, jointly organised an event on deforestation-free agricultural production and trade.

The workshop was a part of the fourth Global Conference of the One Planet Network's Sustainable Food Systems Programme. A side event brought together the experience and expertise of various institutions as well as introduced case studies of emerging good practice interventions to adapt to the requirements of deforestation free commodity production and trade.

See: https://vir.com.vn/deforestation-free-agricultural-production-and-trade-101434.html

8. BRAZIL

 Teak in Brazil
Teak (Tectona grandis) plantations have become profitable in the State of Mato Grosso due to the favorable soil and climatic conditions. Brazil is the largest teak producer in South America with 88,000 ha. according to the Brazilian Tree Industry (IBÁ).

Of this total, 77% of the teak plantations are in Mato Grosso State. A survey carried out by the Mato Grosso Institute of Agricultural Economics (IMEA) shows that the area of teak forests in the state is around 68,000 ha.

According to a Brazilian company, Teak Resources Co. (TRC) plantation technology has advanced considerably since the first afforestation efforts. Productivity has risen and the form of the bole has improved. TRC reports it has a traceability system and the products are FSC certified.

See: https://www.canalrural.com.br/mato-grosso/reflorestamento-com-madeira-nobre-e-visto-como-solucao-sustentavel/

African mahogany in Brazil
African mahogany (Khaya Grandifoliola) wood, currently traded mainly in the domestic market, comes from thinnings. Rough sawn timber is classified into A+, A, B+ and B according to quality and size.

The measurement of A+ class is over 15 cm in width without defects and trades at R$4,500.00/cu.m, The A class wood is between 11 cm and 15 cm wide without defects and is traded at R$ ,800.00/cu.m.

The B+ class wood is over 15 cm in width with defined defects and is traded at R$2,800.00/cu.m. B class is between 11 cm and 15 cm in width with defects and traded at R$2,100.00/cu.m. All graded timber is sawn to order and kiln-dried.

See: https://abpma.org.br/jornais-abpma-2023/

Export update
In March 2023 Brazilian exports of wood-based products (except pulp and paper) decreased 19% in value compared to March 2022, from US$423.2 million to US$341.9 million.

Pine sawnwood exports decreased 19% in value between March 2022 (US$73.9 million) and March 2023 (US$60.1 million). In volume, exports decreased 6% over the same period, from 275,000 cu.m to 258,900 cu.m.

Tropical sawnwood exports fell 38% in volume, from 43,400 cu.m in March 2022 to 27,000 cu.m in March 2023. In value, exports decreased 18% from US$17.9 million to US$14.6 million over the same period.

Pine plywood exports experienced a 22% deline in value in March 2023 compared to March 2022, from US$86.6 million to US$67.5 million.

In volume, exports dropped 0.4% over the same period, from 214,300 cu.m to 213,500 cu.m.

As for tropical plywood, exports decreased in volume by 45% and in value by 44%, from 6,200 cu.m and US$3.2 million in March 2022 to 3,400 cu.m and US$1.8 million in March 2023.

As for wooden furniture the export value fell from US$59.5 million in March 2022 to US$54.4 million in March 2023, an almost 9% drop.

IBAMA -CITES regulations on ipe and cumaru to be implemented from 2024
Two timber species from the Brazilian Amazon ipê (Handroanthus spp.) and cumaru (Dipteryx odorata) were included in Appendix II of CITES (Convention on International Trade in Endangered Species of Wild Flora and Fauna) in November 2022. IBAMA (Brazilian Institute of Environment and Renewable Natural Resources) has set November 2024 as the date for implementing the CITES requirement for the export of these timber species, thus applying the maximum timeframe allowed by CITES.

Ipê is used to for decks, flooring, furniture and construction and is in great demand. According to CITES, 469,600 cu.m of ipê from the Amazon were legally exported between 2017 and 2021, of which 96% from Brazil. During this period the international consumption of ipê from Brazil grew 126%, according to IBAMA. The United States is the largest market for ipê accounting for 36% of exports.

Pará State is the largest exporter of timber from natural forests in Brazil according to IBGE (Brazilian Institute of Geography and Statistics); 212,000 cu.m of timber were exported between 2020 and 2021, of which 4% was ipê.

For Imaflora (Institute of Agricultural and Forest Management and Certification), the inclusion of the two species in CITES Appendix II is important to lower the risk of these species becoming endangered.

See: https://noticias.uol.com.br/politica/ultimas-noticias/2023/04/08/sob-governo-do-pt-ibama-adia-restricao-a-exportacao-de-madeira-nativa.htm

Furniture exports dropped at the beginning of 2023
Brazilian furniture exports started 2023 with a 25% decline in January compared to a month earlier. The US$45 million in January 2023 exports were sharply down on the US$68 million exported in January 2022.

The US continues to be the main international market for Brazilian furniture, US$14.4 million in January 2023 or 32% of all January exports. Exports to Uruguay, second placed in the ranking of the main importing countries, grew in 2023.

There are four major export categories in the sector, wooden furniture, upholstered furniture, metal furniture and mattresses. Wooden furniture represented 81%, upholstered furniture (12%), mattresses (4%) and metal furniture (3%). In January this year wooden furniture exports were down 3% year on year.

See: https://emobile.com.br/site/industria/exportacoes-de-moveis-e-colchoes-abrem-2023-em-queda/

Through the eyes of industry
The latest GTI report lists the challenges identified by the private sector in Brazil.

See: https://www.itto-ggsc.org/static/upload/file/20230414/1681442042214477.pdf

9. PERU

 Export shipments of sawnwood up slightly
Exports of sawnwood in the first two months of this year were worth US$6.3 million, a slight increase (1.2%) year on year. Sawnwood accounted for 35% of the value of wood product exports according to the Association of Exporters (ADEX).

This was the highest amount (January - February period) since 2014 when exports reached US$10.6 million. In the past five years export shipments have not been stable, in 2019 they totalled US$3.1 million, in 2020 US$6.1 million, in 2021 US$4.0 million and in 2022 US$6.2 million.

Despite a 26% decline in the value of imports the Dominican Republic was the top buyer of Peruvian sawnwood importing US$1.9 million in the first two months of 2023. China was the second destination at US$1.5 million but for China there was an over 80% increase in the value of shipments year on year.

The other markets were Mexico (US$1.1 million), Ecuador (US$0.61 million), USA (US$0.30 million), Vietnam (US$0.19 million), South Korea (US$0.15 million), Jamaica (US$0.11 million), Canada (US$0.10 million) and Australia (US$0.07 million).

In the first two months of the year the main regions from which sawnwood was exported were Lima (US$2.8 million) and Ucayali (US$2.3 million). These two regions had a share of 81% of the total shipments. Other exporting regions were San Martín (US$0.54 million), Madre de Dios (US$0.23 million), Loreto (US$0.18 million), Junín (US$0.16 million) and Huánuco (US$0.06 million).

New communication tool - the ‘Electronic Box’
A Regulation on the Electronic Box Notification System published on 25 April this year by the Forestry and Wildlife Resources Supervision Agency (OSINFOR) provided that holders of forest titles will have an individual account in the ‘Electronic Box’ that will be provided by OSINFOR to facilitate communications, the sending of alerts and notifications in order to improve the exchange of documentation and enhance coordination.

According to OSINFOR the ‘Electronic Box’ is a digital tool that will guarantee the efficiency, confidentiality, authenticity, integrity and availability of the information sent and received between holders, entities, the general public and OSINFOR. In addition, it will contribute to saving time in procedures and other administrative actions both for OSINFOR and for forest owners and agent as well as other entities related to the sector.

SERFOR works with regional governments to verify the legality
With the technical assistance of the National Forestry and Wildlife Service (SERFOR) the regional governments of Madre de Dios, Loreto, Ucayali San Martín and the Central Forestry and Wildlife Technical Administration have developed digital tools that will help verify the legal origin of wood.

There are three applications that are part of the Control Module of the National Forest and Wildlife Information System (MC-SNIFFS), the Issuance and Registration of Forest Transport Guide, the Electronic Operations Books of Authorising Titles and the Electronic Operations Books of Primary Transformation Centers.

The new tools provide a means for recording information on the traceability of the wood from its origin, tracking the location and movement of forest products throughout the production chain in order to be able to corroborate the legal origin and promote competitiveness.