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Snapshot of China and the Mekong:
Timber Trade and Governance
Kerstin Canby, Forest TrendsMay, 2011
China timber product imports (million m3 RWE)
0
10
20
30
40
50
60
70
80
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Volu
me
(mill
ion
m3
RWE)
Russia Canada New Zealand United States
Vietnam Thailand Africa Papua New Guinea
Australia European Union Indonesia Others
China timber product exports (million m3 RWE)
0
10
20
30
40
50
60
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Volu
me
(mill
ion
m3
RWE)
Plywood Furniture Fiberboard
Floorings & Moldings Sawn wood Joinery
Veneer Wood chips Other wood
2009: China only major market show demand growth
China US Canada EU Japan M. East
Softwood lumber +20% -23% -15% -15% -14% +15%
Plywood +5 -16 -16 -29 -17 +16
Particle board +2 -5 -7 -13 -12 +3
MDF +5 -3 -20 -20 -19 +46
Pulp +21 -9 -19 -16 -21
Paper +7 -5 -2 -6 -14
Packaging & Tissue
+2 -21 -2 -16 -13
China’s domestic markets responsible for a large part of global recovery
• Strong economy & rise of large middle class• Stimulus package > infrastructure & construction• Increased acceptance of lumber construction
Green economy or procurement programs mainly focus on resource efficiency, not sourcing issues. This may change with recent food scandals.
China, Thailand and Vietnam Forest Product Imports
China, Thailand and Vietnam Exports (US$ billion)
Vietnam Forest Product Imports (million m3)
0
1
2
3
4
5
6
7
8
9
10
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Volu
me
(mill
ion
m3
RW
E)
Thailand Indonesia Malaysia China Taiwan United States
New Zealand Brazil European Union South Korea Laos Japan
Chile Philippines Singapore Australia Cambodia Others
Vietnam• Like China, stopped harvesting own natural forests
• Demonstrated “leakage” effect on neighboring countries (implications for REDD+)
• Plantations plantations plantations
• 0 land certified; many CoC certifications
• Industry very concerned about Lacey and EU TR
• VPA discussions on-going, with preliminary studies being undertaken w/ strong government – industry collaboration
Vietnam Forest Product Exports (US$ billion)
~75%
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
US$
Bill
ion
United States European Union Japan China Taiwan South Korea Australia Canada Others
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Volu
me
(mill
ion
m3
RWE)
Malaysia Laos Chile China United States MyanmarNew Zealand European Union Others
Thailand Timber Product Imports (million m3)
Thailand• Like CN, like VN, stopped harvesting own natural forests• Existing control systems to track domestic wood• Plantations plantations plantations• 7,000 ha certified (FSC)• History of land conflict, and a highly controversial policy process related to community forest management / enterprises• Industry very concerned about Lacey and EU TR
Thailand Forest Product Exports (US$ billion)
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
US$
Bill
ion
China European Union Japan United States Vietnam Malaysia South Korea Taiwan Others
Lao Forest Product Exports (US$ million)
0
20
40
60
80
100
120
140
160
180
200
2000 2001 2002 2003 2004 2005 2006 2007
US$
Mill
ions
Vietnam Thailand China Japan
Taiwan South Korea European Union Others
Laos• “Conversion timber” predominant source of exported timber
• Questions about due process in land allocation process• Land use conflicts increasing• Means to justify harvesting timber outside quota system?
• Significiant challeges defining “legal”• Many legal loopholes• Difficult to find out why there are apparent
exceptions to a log export ban
Cambodia Forest Product Exports (US$ million)
0
10
20
30
40
50
60
70
80
90
100
110
2000 2001 2002 2003 2004 2005 2006 2007 2008
US$
Mill
ion
Vietnam China Thailand Taiwan Japan Malaysia European Union Others
Cambodia• No industrial scale forest concessions since early 2000s• “conversion timber” likely dominant export source
• Land use permits not following legal procedures• Land use conflicts increasing• Importance of Vietnamese & Chinese investment
• Plantations plantations plantations
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Volu
me
( mill
ion
m3
RWE)
India China Thailand Vietnam Bangladesh South Korea
Myanmar timber product exports (million m3 RWE)
Summary of main issues:1. Garden variety issues:
• Capacity, political and financial means for effective forest governance (including lack of domestic experts / civil society with practical experience with legality verification processes
• Confusing laws & regulations• Lack of good data….
2. “Conversion timber”• All countries pursuing large-scale agribusiness or
infrastructure development programs which will require land clearance (rubber, sugarcane, hydropower, roads)
3. Many of these programs are associated with irregularities in process and land use conflict• If they proceed according to law, these developmental
projects are within sovereign rights of each individual country – thus legal.
• However, land allocations not proceeding according to law, even in China (recent RRI report on Stora Enso plantations)
• Underlying this is insecure land tenure, rights of access, etc.
4. Are these legitimate development projects, or just fronts to gain permits to clear-cut the forest (and then never proceed with the investment project)?
55
4. How do legal verification programs handle conversion timber?• Will it be accepted by markets?• Are verification / certification programs designed to
handle this type of timber?
5. Potential for REDD / FLEGT mutual benefit huge,• VN, Cambodia, Laos engaged in UNREDD, FCPF, FIP….• Lao P-RR – majority of “REDD implementation” activities
are basic forest governance: inventories, monitoring, etc. • VN plans to spend $80m (4 yrs) on performance based
payments presumably to households – land rights will be important to both REDD and forest legality processes.
Thank you for your time
kcanby@forest-trends.orgwww.forest-trends.org
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