ACIAR project FST/2008/039
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1 Click to edit Master title style ACIAR project FST/2008/039 Global Markets for Plantation Teak: Implications for Lao PDR Stephen Midgley
2 Overview An understanding of the nature of global teak markets will offer a basis for improving opportunities for smallholder growers in northern Lao PDR Midgley, S. J., Mounlamai, K, Flanagan, A. and Phengsopha, K. (2015). Global Markets for Plantation Teak; Implications for Growers in Lao PDR. Study completed for ACIAR Project FST/2012/012 Enhancing Key Elements of the Value Chains for Plantation-Grown Wood in Lao PDR. 74pp. Available at:
3 Methods Literature Review: published and grey Previous professional studies on teak (India, Solomon Islands, Indonesia, PNG and Lao PDR) Use of Databases: Customs Departments of Thailand, Vietnam, Lao PDR, China, DGCIS (India) and the Global Trade Atlas Industry interviews: Confidential (India, Lao PDR, China) Use of data from ACIAR/ PARDI: Midgley S., Somaiya R.T., Stevens P.R., Brown A., Nguyen Duc Kien and Laity R Planted teak: global production and markets, with reference to Solomon Islands. ACIAR Technical Reports No. 85. Australian Centre for International Agricultural Research: Canberra. 92 pp. (available at: )
4 Who grows? Who sells? Global: Est. production: 30M m 3 Est. harvest: 2.5 M m 3 Est. traded: 1.2 M m 3 Lao PDR Est Production: 0.1M m 3 Est. Traded: m 3 Lao PDR is a small player in global markets
5 Who are the buyers?
6 India Expanding trade with Central and South America
7 China
8 Vietnam
9 Thailand
10 Who buys Lao Teak
11 Considerations for efficient trade Log measurement Logistics/shipping (break bulk and containers) Wood quality Colour International regulations and Certification Competition
12 Measurement and Shipment Expensive/small consignments/ regular Different shipping systems Containers Vs Break Bulk Cheap/ Large consignments Photo courtesy Richard Laity Different measuring systems. (JAS, Brereton, Hoppus? Is this shipment 13 m 3 or 11 m 3?
13 Size matters! 12+yrs 60+yrs US$3000/m 3 US$200/m 3
14 International Influences European Union Timber Regulation (EUTR) and Voluntary Partnership Agreements (VPA) The Lacey Act (USA) Japan s Law Promotion of the Procurement of Eco-Friendly Goods and Services by the State and Other Entities Australian Illegal Logging Prohibition Bill Certification Chain of Custody Impacts Control access to markets Can enhance market opportunities All add costs who pays? BUT Major markets of India and China are unwilling to pay premiums for certified wood (nor is Europe) Legality is the major issue
15 Challenges Data Discrepancies Data (Lao DIMEX) Data (China Customs; GTA) Data (Lao DIMEX) Data (Thai Customs)
16 Challenges Changing Market Landscape since 2014 Log export ban in place in Lao PDR (2016) Log export ban in place in Myanmar (2014)
17 Conclusions Generic The global resource of planted teak is maturing and substantial. Increasing amounts of plantation grown teak will become available on global markets Teak consumption by global market leaders is increasing For Lao PDR: China, Thailand and Vietnam are the dominant markets Demand from China is strong and expanding Demand from India is strong and offers opportunities for expansion Vietnam and Thailand need legal wood to meet EUTR and Lacey Act requirements Opportunities for local processing (new regulations) Lao PDR faces competition Confident about the future
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