SLVK Timber Legality Verification Sistem Verifikasi Legalitas Kayu (SVLK) Indonesian Timber Legality Assurance System (INDO-TLAS)

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1 SLVK Timber Legality Verification Sistem Verifikasi Legalitas Kayu (SVLK) Indonesian Timber Legality Assurance System (INDO-TLAS) Community Plantation Partnership Hutan Rakyat Kemitraan 8/12/2016 PT Pundi Uniwood Industry 1 Agenda Introduction PT Pundi Uniwood Industry Company profile Certifications Product range Wood species Commitments Community Plantation Partnership What is Hutan Tanaman Rakyat (HTR) or Peoples Plantation? Rationalization to promote replantation through strategic partnership with local communities PT PUI partnership program: Phases of development & result SVLK Timber Legality Verification Means & purpose of SVLK Implementation of SVLK 8/12/2016 PT Pundi Uniwood Industry 2 PT Pundi Uniwood Industry 1

2 PT Pundi Uniwood Industry Established in the year 2000 as a locally funded private firm A premier in manufacturing wood products: Bare Core, Block Board & Plywood Total production capacity: 100,000m3/year Total employees: 1,800 Sales market ratio Export: 80% (Middle East, South-East Asia, South Korea & China) Local: 20% 8/12/2016 PT Pundi Uniwood Industry 3 Vision To provide substantial benefit for Indonesia through manufacturing of wood-based products in an environmentally friendly and sustainable way. Mission Utilize local resources for production to boost economic growth. Creates jobs to increase livelihood and welfare for the local society. Foster a strategic & beneficial partnership for replantation between local communities, government and manufacturers to create a sustainable supply of logs. 8/12/2016 PT Pundi Uniwood Industry 4 PT Pundi Uniwood Industry 2

3 Certifications 1. SVLK No. 0010/MHI-VLK Issuer: PT Mutu Hijau Indonesia Valid since 23 May SVLK No. 007/MHI-VLKH Issuer: PT Mutu Hijau Indonesia Valid since 14 November 2013 For Hutan Rakyat Kemitraan / Community Replantation Partnership 3. CoCFSC No. TT-COC Issuer: PT Mutu Agung Lestari Valid since March Medal of appreciation from Indonesian Ministry of Forestry Bronze Medal Gold Medal 2014 Gold Medal Platinum Medal Medal of appreciation for the effort of establishing & nurturing Woodbased Industries through Hutan Rakyat / Peoples Plantation 8/12/2016 PT Pundi Uniwood Industry 5 Product Ranges Bare Core Block Board Plywood Specifications L x W 1220mm x 2440mm Thickness 13mm Specifications L x W 1220mm x 2440mm Thickness 15mm & 18mm Specifications L x W 1220mm x 2440mm Thickness 2.7mm, 3.6mm, 5mm, 9mm, 12mm, 15mm & 18mm 8/12/2016 PT Pundi Uniwood Industry 6 PT Pundi Uniwood Industry 3

4 Wood Species Fast growth rate Anthocephalus Cadamba Local name: Jabon Softwood Time of harvest: 7 10 Years Albasia Falcata Local name: Albasia Softwood Time of harvest: 5 7 Years 8/12/2016 PT Pundi Uniwood Industry 7 Commitments We are committed to utilizing locally sourced raw materials to produce woodbased products with an excellent quality while still competitively priced. Manufacturing wood-based products which has a major proportion of Jabon/Albasia in order to boost demand for the following wood species. 95% of our logs supplies are sourced from sustainable plantations through strategic partnerships ever since In order to established a sustainable resources, we are committed in planting 500,000 trees yearly. To date, our collaborations with local communities have planted 3,200,000 trees in a total area of 4,900Ha. Increases farmland productivity. Contributes in raising awareness of climate change, taking action & apply measurements to reduce greenhouse gases. 8/12/2016 PT Pundi Uniwood Industry 8 PT Pundi Uniwood Industry 4

5 People Plantation or Hutan Tanaman Rakyat? 8/12/2016 PT Pundi Uniwood Industry 9 Why People Plantations? 1. Provide a sense of belonging for the communities Establish responsibilities Potential growth for investment Promotes better land management Ease of access & protection 2. Easier documentation and application for the usage of plantation harvested logs compared to natural harvested logs. 3. Promised a better outlook for the revitalization of sustainable logging and reviving wood-processing industries. 4. Inaccessibility to state forest lands Difficulties in accessibility, management & security. May result in higher cost 8/12/2016 PT Pundi Uniwood Industry 10 PT Pundi Uniwood Industry 5

6 Community Plantation Partnership 8/12/2016 PT Pundi Uniwood Industry 11 Birth of Strategic Partnership Reasons for establishment 1. Substantial amount of lands that are not being managed properly and left unproductive. 2. Difficulties to obtain constant supply of logs. 3. Local village communities are still living in poverty. 4. Increasing need to improvise to better compete with foreign competitors. 5. Unsustainable and bleak future for the wood-based industries. 6. Increasing evidence of impact due to climate change. Benefits & advantages 1. Close, reliable and constant supply of logs. 2. Huge demand for logs for local industry. 3. Competitively priced raw materials. 4. Increase productivity of wood-based industries & unused lands. 5. Improved livelihood of surrounding communities. 6. Poverty reduction & rural economic growth. 7. Plays a crucial part in combating climate change. 8. Moving towards a sustainable industrialization. 8/12/2016 PT Pundi Uniwood Industry 12 PT Pundi Uniwood Industry 6

7 Involvement & Participation Through research & collaboration with community of farmers, PT PUI cultured a seedbed of superior breed of Albasia & Jabon seedling. Seeds are distributed throughout freely to members of our Community Plantation Partnership program. Basic facilities for plantation are provided for the community. Technical knowledge for cultivating, nurturing and logging process in every phase of plantation are taught and implemented under supervision. Provide assurance that supply of logs will be bought at present market value. Facilitate the process for members to adhere SLVK requirements. 8/12/2016 PT Pundi Uniwood Industry 13 Joint Community Plantation Locations 8/12/2016 PT Pundi Uniwood Industry 14 PT Pundi Uniwood Industry 7

8 Plantation Process 8/12/2016 PT Pundi Uniwood Industry 15 Germination Ready for plantation Land preparation Plantation (2 months old) 8/12/2016 PT Pundi Uniwood Industry 16 PT Pundi Uniwood Industry 8

9 Plantation (6 months old) Plantation (1 year old) Plantation (1.5 years old) Plantation (2 years old) 8/12/2016 PT Pundi Uniwood Industry 17 Monitoring activities done periodically 8/12/2016 PT Pundi Uniwood Industry 18 PT Pundi Uniwood Industry 9

10 Effective since 1 st January /12/2016 PT Pundi Uniwood Industry 19 4 Basis of Foundation Essential components that forms the basis of SVLK 1. Legality definition: The legality definition clearly states the aspects of Indonesia law for which the timber legality assurance system will systematically seek evidence of compliance. Indonesia has different legality definitions for different kinds of rights and permit holdings 2. Supply chain control: The purpose of supply chain control is to ensure that unverified products do not enter the supply chain. 8/12/2016 PT Pundi Uniwood Industry 20 PT Pundi Uniwood Industry 10

11 4 Basis of Foundation (Continued) 3. Verification of compliance: This detects whether timber products comply with the SVLK legality definition and supply chain controls and are therefore legal. In Indonesia, independent private companies called Conformity Assessment Bodies (mandated by the Government of Indonesia and controlled by the national accreditation body, KAN) verify compliance with the legality definition. Some exemptions for small scale operators exist. Overall oversight remains the responsibility of the government. 4. Periodic evaluation: In Indonesia, independent audit is termed periodic evaluation to distinguish it from the independent Conformity Assessment Body audits mentioned above. The purpose of periodic evaluation is to regularly check that all aspects of a legality assurance system are working properly. Evaluations must take place no more than 12 months apart. The evaluator will produce reports for the Joint Implementation Committee and a public report. 8/12/2016 PT Pundi Uniwood Industry 21 Documentation DKP/Nota Official timber documentation SVLK-certified supplier are required to produce DKP/NOTA for sales of certified timber. SVLK-certified buyers are prohibited to purchase/process/sell timber without DKP/NOTA documentation. V-Legal Document V-Legal Documents are Indonesian export licenses attesting legality. Companies that comply with the timber legality assurance system (SVLK) need to attach a V-Legal Document to their consignments for export to any international market. The V-Legal Document specifies that the timber products being shipped comply with the legality and/or sustainability standard and the supply chain control requirements as stipulated in Indonesian regulations and the VPA. Thus the V-Legal Document provides assurance that timber or timber products are legal. V-Legal Documents are issued by bodies authorized by the Indonesian government to act as licensing authorities. 8/12/2016 PT Pundi Uniwood Industry 22 PT Pundi Uniwood Industry 11

12 PT PUI & Community Partnerships Certified by an Independent Conformity Assessment Bodies: PT Mutu Hijau Indonesia License for utilization of timber in the community forest. Certified since November 2013 License for primary process of forest timber. Certified since November /12/2016 PT Pundi Uniwood Industry 23 SVLK Implementation License for utilization of timber in the community forest. Community Partnership allow members to utilize our SVLK Certification for harvesting & selling of certified timbers. Make documentation Produce DKP/NOTA Issue DKP/NOTA to Buyer 8/12/2016 PT Pundi Uniwood Industry 24 PT Pundi Uniwood Industry 12

13 SVLK Implementation License for primary process of forest timber. SVLK Certification needed for export Obtain DKP/NOTA Files documentation Production process for export Submit proforma invoice & packing list to CAB Process complete Submit documents to custom authority Produce transportation documents CAB issue V- Legal Document 8/12/2016 PT Pundi Uniwood Industry 25 Thank you 8/12/2016 PT Pundi Uniwood Industry 26 PT Pundi Uniwood Industry 13