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Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Global Forest Products Market and Resource Trends
Ed Pepke, Ph.D.Forest Products Marketing SpecialistFood and Agricultural Organization
UN Economic Commission for EuropeGeneva, Switzerland
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Contents
I. Forest products markets• Production, consumption & trade• Global• Regional (N. America, Europe, Asia)• Market sectors (logs, lumber, panels)
II. Forest resourcesIII. Certification and certified forest productsIV. Growing the market
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Major info sources
• UNECE/FAO TIMBER database on forest products• FAOSTAT database on forest products• UNECE/FAO Temperate & Boreal Forest Resources
Assessment• FAO Global Forest Resources Assessment• UNECE Timber Committee market forecasts• UNECE/FAO Timber Bulletin “Forest products
annual market review, 2003-2004”• Global Forest Products Model, by Buongiorno, et
al.• UNECE/FAO European Forest Sector Outlook Study• FAO State of the World’s Forests, 2005
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
I. Forest products markets
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Sectoral analysis: Logs
UNECE/FAO definitions:• “Roundwood” is industrial roundwood + fuelwood• “Industrial roundwood” as sawlogs, veneer logs, pulp logs and other industrial roundwood
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
World production of roundwood, 1961-2003
Source: FAOSTAT
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
1961
1963
1965
1967
1969
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
Bil
lio
n m
3
Industrial roundwood Fuelwood
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
World roundwood utilization as fuel
• Over half used as fuel– Domestic heating– Cooking
• Mostly in developing countries
• Low value• Modern wood energy
– Small international trade– Growing market– Policy push in Europe
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Regional production of industrial roundwood, 1961-2010
0
200
400
600
800
1000
1200
1400
1600
1800
2000
1961
1964
1967
1970
1973
1976
1979
1982
1985
1988
1991
1994
1997
2000
2010
Bil
lio
n m
3
Africa Asia America Europe
Source: FAOSTAT and FAO Global Forest Products Outlook Study
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
American industrial roundwood consumption and production to 2010
0
100
200
300
400
500
600
700
800
900
1000
1980 1994 2000 2005 2010
Mil
lio
n m
3
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
American industrial roundwood trade to 2010
0
5
10
15
20
25
30
35
1980 1994 2000 2005 2010
Mil
lio
n m
3
ExportsImports
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Factors affecting models and markets
• Gross domestic product (GDP)• Population• Costs and prices (labor, raw material, etc.)• Technological change• Government policies• Socio-economic trends
Source: FAO Global Forest Products Consumption, Production, Trade and Prices: Global Forest Products Model Projections to 2010. By Zhu, S; Tomberlin, D; Buongiorno, J., 1998
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
European industrial roundwood consumption and production to 2010
0
100
200
300
400
500
600
1980 1994 2000 2005 2010
Mil
lio
n m
3
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
European industrial roundwood trade to 2010
0
10
20
30
40
50
60
70
80
1980 1994 2000 2005 2010
Mil
lio
n m
3
ExportsImports
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Asian industrial roundwood consumption & production to 2010
0
100
200
300
400
500
600
1980 1994 2000 2005 2010
Mil
lio
n m
3
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Asian industrial roundwood trade to 2010
0
10
20
30
40
50
60
70
80
1980 1994 2000 2005 2010
Mil
lio
n m
3
ExportsImports
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Regional trade, all primary forest products, 2003
Source: FAOSTAT
0
10
20
30
40
50
60
70
80
$ B
illi
on
Exports Imports
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
North American trade, all primary forest products, 1994-2003
Source: FAOSTAT
0
5
10
15
20
25
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Bill
ion
$
Canadian imports USA imports Canadian exports USA exports
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
European primary wood products demand, 1980-2020
0
200
400
600
800
1000
1200
1980 1985 1990 1995 2000 2005 2010 2015 2020
Mill
ion
m3
, RW
E
RWE=RoundWood Equivalent. Source: European Forest Sector Outlook Study, 2005.
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Major influences on current European forest sector
• Expanding markets, but resources outgrowing markets• Intensifying trade• Recovery from transition to market economies• Non-wood forest products increasing demand, value• Renewable energy policy of EU and member countries• Globalization of forest products trade• Innovation of products and processing• Recycling of paper, use of byproducts
Source: UNECE/FAO European Forest Sector Outlook Study, 2005
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Sectoral analysis: Lumber
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
N. American softwood lumber market, 1996-2005
Source: UNECE Timber Committee forecasts, 10.2004
90 000
100 000
110 000
120 000
130 000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
1000
m3
Production Consumption
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
N. American softwood lumber trade, 1996-2005
0
10 000
20 000
30 000
40 000
50 000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
1000
m3
Imports Exports
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
N. American hardwood lumber market, 1996-2005
20 000
23 000
26 000
29 000
32 000
35 000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
1000
m3
Production Consumption
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
N. American hardwood lumber trade, 1996-2005
0
1 000
2 000
3 000
4 000
5 000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
1000
m3
Imports Exports
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
American lumber consumption & production to 2010
0
50
100
150
200
250
300
1980 1994 2000 2005 2010
Mil
lio
n m
3
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
American lumber trade to 2010
Source: Global Forest Products Model, 2003
0
10
20
30
40
50
60
70
80
1980 1994 2000 2005 2010
Mil
lio
n m
3
ExportsImports
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
US lumber imports: Europe & S. Hemisphere
Sources: USDA-Foreign Ag. Svc. and Wood Markets Monthly, 2005
0
0.5
1
1.5
2
2.5
3
3.5
1996 1997 1998 1999 2000 2001 2002 2003 2004
Mil
lio
n m
3
EuropeS. Hemisphere
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
• Excludes Canadian imports– 98% of US imports in ’96, but 87% 2004– Canadian-sourced imports up 8% 2004
• Aided by Softwood Lumber Agreement duties• Imports of dimension softwood, some EWPs• European-sourced imports
– Increased 52% in 2004– Despite 45% rise in euro value vs. $– “Semi-natural forests” vs. plantation
US lumber imports: Europe & S. Hemisphere
Sources: USDA-Foreign Ag. Svc. and Wood Markets Monthly, 2005
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
• Northern hemisphere sources in 20041. Germany (up 73%)2. Austria (up 75%)3. Sweden (down 2%)4. Czech Rep., Lithuania, Russia, Finland, Estonia
• Southern hemisphere sources in 20041. Brazil (up 37%)2. Chile (up 35%)3. New Zealand (down 3%)4. Argentina, Mexico, other
US lumber imports: Europe & S. Hemisphere
Sources: USDA-Foreign Ag. Svc. and Wood Markets Monthly, 2005
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
European softwood lumber market, 1996-2005
60 000
70 000
80 000
90 000
100 000
110 000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
1000
m3
Production Consumption
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
European softwood lumber trade, 1996-2005
0
10 000
20 000
30 000
40 000
50 000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
1000
m3
Imports Exports
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
European hardwood lumber market, 1995-2004
10
12
14
16
18
20
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Mill
ion
m3
Production Consumption
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
European hardwood lumber trade, 1995-2004
0
2
4
6
8
10
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Mill
ion
m3
Imports Exports
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Europe lumber consumption and production
to 2010
0
20
40
60
80
100
120
140
1980 1994 2000 2005 2010
Mil
lio
n m
3
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Europe lumber trade to 2010
Source: Global Forest Products Model, 2003
0
5
10
15
20
25
30
35
40
45
50
1980 1994 2000 2005 2010
Mil
lio
n m
3
ExportsImports
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Russian softwood lumber market, 1996-2005
0
5 000
10 000
15 000
20 000
25 000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
1000
m3
Production Consumption
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Russian softwood lumber trade, 1996-2005
0
2 000
4 000
6 000
8 000
10 000
12 000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
1000 m
3
Imports Exports
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Asia lumber production and consumption to 2010
0
20
40
60
80
100
120
140
160
180
1980 1994 2000 2005 2010
Mill
ion
m3
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Asia lumber trade to 2010
0
5
10
15
20
25
30
1980 1994 2000 2005 2010
Mil
lio
n m
3
ExportsImports
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Sectoral analysis: Panels
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
North America structural panel production,
1996-2005
0
5 000
10 000
15 000
20 000
25 000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
10
00
m3
OSB Plywood
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
European OSB market, 1996-2005
0
1 000
2 000
3 000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
10
00
m3
Production Imports Exports
Source: UNECE Timber Committee forecasts, 10.2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
America panel consumption & production to 2010
0
10
20
30
40
50
60
70
80
90
1980 1994 2000 2005 2010
Mil
lio
n m
3
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
America panel trade to 2010
0
2
4
6
8
10
12
14
16
18
1980 1994 2000 2005 2010
Mil
lio
n m
3
ExportsImports
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Europe panel consumption & production to 2010
0
10
20
30
40
50
60
70
1980 1994 2000 2005 2010
Mil
lio
n m
3
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Increasing small log demand
• For increasing panels production• Lumber production rising slower• For growing paper demand• For rising packaging demand
– Cardboard (paperboard)– Pallets
• Wood-based energy
Main source: European Forest Sector Outlook Study, 2005.
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Europe panel trade to 2010
0
5
10
15
20
25
30
1980 1994 2000 2005 2010
Mil
lio
n m
3
ExportsImports
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Asia panel consumption & production to 2010
0
10
20
30
40
50
60
70
80
90
1980 1994 2000 2005 2010
Mil
lio
n m
3
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Asia panel trade to 2010
0
5
10
15
20
25
30
35
1980 1994 2000 2005 2010
Mil
lio
n m
3
ExportsImports
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
An aside on theChinese market
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
China’s expanding trade
• Total export value 2003: $390 billion, +36%• Total import value 2003: 371 billion, +39%• Trade surplus: $20 billion• China & Japan 2003 trade: $120 billion, +31%• China & US 2003 trade: $114 billion, +29%• China & Europe 2003 trade: $112 billion,
+43%• “Sudden growth” of primary product imports:
timber, steel, oil, soybeans
Source: “China Forest Products Market Information”, December 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
China’s booming timber imports
• Housing construction– Only minority wood-based– Green and healthy communities– Affordable
• Renovation market for houses and municipal• Infrastructure development• Interior woodwork and furnishings• Olympic-related construction (2008 Beijing)
Source: “China Forest Products Market Information”, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Sectoral analysis: Paper
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
N. American paper & paperboard consumption and production to 2010
0
20
40
60
80
100
120
140
160
180
200
1980 1994 2000 2005 2010
Mil
lio
n M
etr
ic T
on
s
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
N. America paper & paperboard trade to 2010
0
5
10
15
20
25
30
35
40
45
1980 1994 2000 2005 2010
Mil
lio
n M
etr
ic T
on
s
ExportsImports
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
European paper & paperboard consumption and production to 2010
0
20
40
60
80
100
120
140
160
1980 1994 2000 2005 2010
Mil
lio
n M
etr
ic T
on
s
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Europe paper & paperboard trade to 2010
0
10
20
30
40
50
60
70
1980 1994 2000 2005 2010
Mil
lio
n M
etr
ic T
on
s
ExportsImports
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Asia paper & paperboard consumption and production to 2010
0
20
40
60
80
100
120
140
160
180
1980 1994 2000 2005 2010
Mil
lio
n M
etr
ic T
on
s
ConsumptionProduction
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Asia paper & paperboard trade to 2010
0
5
10
15
20
25
30
35
40
1980 1994 2000 2005 2010
Mil
lio
n M
etr
ic T
on
s
ExportsImports
Source: Global Forest Products Model, 2003
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
New EFSOS market conclusions
• Collapse in CIS and eastern Europe, 1990s
• Partial recovery• Increased small log demand• Increased recovered
materials• Intensifying trade• Declining log prices• Renewable energy
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Productivity in wood industry by region
Source: FAO Trends and current status of the contribution of the forestry sector to national economies, 2004
0
10
20
30
40
50
60
70
80
90
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000
$1
00
0 p
er
em
plo
ye
e
North America Developed Asia-PacificWestern Europe Latin AmericaWest and Central Asia Eastern Europe
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Summary: Key market issues (1 of 2)
• Illegal logging and trade of illegally-sourced wood
• Certification of sustainable forest management, markets for certified forest products
• Policies for promotion of sound use of wood• Research and development policies• Industry competitiveness and investment
policy
Source: Forest Products Annual Market Review, 2003-2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Summary: Key market issues (2 of 2)
• Global competition Increased efficiency in manufacturing, new marketing strategies
• Climate change policy, carbon trading
• Wood energy promotion policies
• Trade policy, tariff and non-tariff barriers
Source: Forest Products Annual Market Review, 2003-2004
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
III. Forest resources
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Where are the forests?
Source: FAO State of the World’s Forests 2005
N&C America14%
S. America23%
Europe27%
Asia14%
Africa17%
Oceania5%
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Where are the plantations?
Source: FAO State of the World’s Forests 2005
Note: Plantation areanot good indicator of supply.
Europe17%
Asia62%
Africa4%
Oceania2%
S. America6%
N&C America9%
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Where’s the wood?
Source: FAO State of the World’s Forests 2005
N&C America17%
S. America29%
Europe30%
Asia9%
Africa12%
Oceania3%
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Wood volume (m3) per hectare
72
112
63
55
123
125
N&C America
S. America
Oceania
Africa
Asia
Europe
• N&C America– US 135 m3– Canada 120 m3– Guatemala 350 m3
• Oceania: NZ 125 m3• S. America: Chile 160• Europe
– Switzerland 340 m3– Germany 270 m3– France 190 m3– Russia 105 m3
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Big logs in Switzerland
• 2nd highest wood volume per forest– 340 m3 per hectare– Only Guatemala higher at 355 m3
• 1/3 forested, mostly on higher ground• Why? Centuries of big log forest management• Not only lumber and beams, also protection• But…1999 windstorms
– Took tall, old, large diameter– 2 years’ harvest in 3 days in Switzerland– 1 year’s in all of Europe in 3 days.
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Small logs in Switzerland?
• Climate change more windstorms, more storm damage and windthrow
• Large logs cost more energy and time for– Transportation and handling– Conversion
• Reduced consumption of solid beams and wide lumber
• Increased composite panels, edge-glued panels, glulam and other EWPs
• European foresters changing “big log” mentality
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Annual change in forest area, 1990-2000, (million hectares)
Deforestation
Increase in forest area
Net change in forest area
Tropics -14.2 +1.9 -12.3Non-tropics -0.4 +3.3 +2.9
World -14.6 +5.2 -9.4
Source: FAO Global Forest Resources Assessment 2000
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Global deforestation of 14
million hectares/year > ½ of Idaho deforested
every year.
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Annual change in forest area, 1990-2000
-6
-5
-4
-3
-2
-1
0
1
2
3
Mill
ion
Hec
tare
s
Natural Plantation Total
N & CAmeric
a
SouthAmerica
Europe
Asia
Africa
Oceania
Source: FAO Global Forest Resources Assessment 2000
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Reasons behind deforestation
• Conversion to other land uses (0.4% of worlds’ forests annually in the ’90s)– Agricultural, including grazing– Urbanization
• Unsustainable silvicultural practices– Unmanaged harvesting– Poor regeneration– Fire, insects and diseases– Overharvesting fuelwood
• Poverty and overpopulation
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Forest resources in N. America
• 80% of net annual increment harvested• Forest volume increases ~3 million m3 daily • Forest area 1990 to 2000
– USA +0.2%– Canada, no significant change
Sources: State of the World’s Forests 2001; Global Forest Resources Assessment 2000; Temperate and Boreal Forest Resources Assessment 2000
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
Forest resources in Europe
• Only 60% of wood grown is harvested• Forest volume increases ~2 million m3 daily • Forestland increases by 500,000 hectares
per year
Sources: State of the World’s Forests 2001; Global Forest Resources Assessment 2000; Temperate and Boreal Forest Resources Assessment 2000
Small Log Conference – Creating Capacity to Compete
Coeur d’Alene, Idaho, USA, 1 April 2005F
AO
State of Europe’s Forests
• Resources and area increasing• Forest health and vitality are critical• Productive functions maintained• Biodiversity is a focus• Plantations are only 3%• Protective forests are 12%• Socio-economic functions important
Source: Ministerial Conference on the Protection of Forests in Europe, 2003
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New EFSOS forest conclusions
• Harvests < growth• Growing stock rising• Increased trade local
forest problem• Problems in economic
viability with falling prices
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Forest resources in Russian Federation
• Only 16% of wood grown is harvested• Forest volume increases ~3 million m3 daily • Forest area 1990 to 2000: no significant
change
Sources: State of the World’s Forests 2001; Global Forest Resources Assessment 2000; Temperate and Boreal Forest Resources Assessment 2000
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Forest resources: growing stock
Source:Temperate and Boreal Forest Resources Assessment 2000
0
10
20
30
40
50
60
70
Europe (41) North America CIS
Growing stock Net annual increment Fellings
sMillion
m
3
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Forest resources: NAI vs. fellings
Million
m
3
Source:Temperate and Boreal Forest Resources Assessment 2000
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
Europe (41) N. America CIS
Net annual increment Fellings
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Forest resources: NAI vs. fellings
Fellings as% of NAI
North America 80%
Europe-41 60%
Western Europe 64%
Nordic countries 72%
Baltic countries 50%
Central & eastern Europe
56%
Russia 16%
Source:Temperate and Boreal Forest Resources Assessment 2000
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Regional forest resource utilization
Note: Not all “forest available for wood supply”Roundwood does not include chips. Therefore, %ages are gross. Sources: State of the World’s Forests 2003, FAO Stat.
Wood in forest (billion
m3)
Roundwoodharvest
2002 (million m3)
Roundwood
harvest 2002 (%)
S & C America
117 439 0.4 %
Russia 89 192 0.2 %
N. America 60 678 1.1 %
Africa 46 613 1.3 %
Asia 35 1,005 2.9 %
Europe 28 395 1.4 %
Oceania 11 63 0.6 %
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• Removals considerably below growth• Wide variance in utilization rates of NAI • Growing stock increasing in Europe• Southern hemisphere plantations expanding• Oversupply compared to demand for wood• Increasing alternative demands on forests
Forest resources summary
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III. Certified forest products markets
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Certification of sustainable forest management
• Over 200 million hectares worldwide (5%)• Over half of world’s certified area in N.
America• Another 40% in Europe
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Area of certified forests, 1996-2004
Source: Forest Products Annual Market Review, 2003-2004
0
20
40
60
80
100
120
140
160
180
200
Mil
lio
n h
ec
tare
s
SFIPEFCFSCCSAATFS
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Top 8 countries certified forest area,2003 and 2004
0
10
20
30
40
50
60
70
PEFC
FSC
SFI
CSA
ATFS
Mill
ion
hec
tare
s
Source: Forest Products Annual Market Review, 2003-2004
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Certification schemes’ market share
Source: Forest Products Annual Market Review, 2003-2004
PEFC30%
FSC25%
SFI23%
CSA15%
ATFS5%
Other2%
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Certified forests by ownership type
Source: Savcore Indufor, 2005
Industry50%
State24%
NIPFO23%
Communal2%
Other1%
Three quarters of the world's certified forests are privately owned or managed
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Certified forest products markets
• Growing demand via wholesalers & retailers• Demand boost by government procurement• Private consumer demand remains minor• Chain-of-custody key current development• Most certified timber sold without label
– Potential over 300 million m3 (20% world roundwood production)
– Lost opportunities for market promotion and PR
Source: Forest Products Annual Market Review, 2003-2004
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Certified forest products markets
• Certification system conflicts discredit forest products in the marketplace
• Variety of schemes necessary for different stakeholders’ interests
• Impacts of forest certification locally significant• Difficulties in certifying natural tropical forests,
but less so for tropical plantations• Markets developing slower than forest
certification
Source: Savcor Indufor, 2005
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Certification
• Introduced to combat deforestation in tropics• Most certified forests are temperate & boreal• Therefore, not an instrument to combat
deforestation, but to promote sustainable forest management
• Mutual recognition between schemes an issue• Potential additional roles
– Verification mechanism in Kyoto Protocol– Indication of source, but not proof of legality
Sources: Savcor Indufor, and UNECE/FAO, 2005
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IV. Growing the market
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Growing too much wood?
Not enough wood products demand?
What are the solutions?
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Grow the wood markets !
• Guarantee that today’s wood products meet consumers’ needs
• Develop new products to meet evolving needs
• Develop new markets for wood products: substitute for non-renewable materials
• Promote wood culture outside N. America and Nordic Countries
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How can we grow the wood markets?
• Build coordinated, international promotion programs
• Enlarge existing networks and coalitions• Create favorable policy environments• Promote public awareness of key issues
and messages
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Market effects of wood promotion policies
• Multi-country wood promotion essential to enlarge wood’s market share
• Promotion must be cost justified• Identify and know target markets: cultural
and technical dimensions• Fund raising a problem in fragmented
industry• Key elements: competence, neutrality,
credibility, resources
Source: UNECE/FAO Forest Products Annual Market Review, 2001-2002
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UNECE Timber Committee recommendations
• Develop new products to expand existing markets
• Establish new markets to meet consumers’ needs
• Build international cooperation in promoting environmental advantages of sustainable wood production
• Promote wood culture
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Discussion and Questions
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Ed PepkeForest Products Marketing Specialist
UNECE/FAO Timber Branch448 Palais des Nations
CH-1211 Geneva 10, Switzerland
Telephone +41 22 917 2872Fax +41 22 917 [email protected]
www.unece.org/trade/timber