2011 Statistics - Netherlands

Transcription

1 2011 Statistics - Netherlands Timber trade monitoring in support of effective, efficient and equitable operation of the EU Timber Regulation (EUTR) Photo credit: American Hardwood Export Council

2 Introduction Background The EU Timber Regulation (EUTR), which comes into force in March 2013, raises important questions for the European wood trade. Will the regulation increase or decrease wood s competitiveness with other materials, or lead to discrimination against suppliers lacking technical or financial resources to provide assurances of legality? Might it discourage smaller operators from engaging in the wood sector at all and encourage retailers currently buying, say, wood furniture with long and complex supply chains from Asia to switch to European alternatives with shorter supply chains, or even to alternative materials? There s a question mark too over whether it will boost demand for certified sustainable forest products or favour alternative risk based legality verification systems. Will it divert wood imports from EU member states with tough enforcement regimes towards those where enforcement is weaker, or will implementation be so ineffectual that it has little impact? To help answer these questions, the European Timber Trade Federation (ETTF) has initiated a program of regular market monitoring to be undertaken by Forest Industries Intelligence Ltd (FII), with support from the UK Department for International Development (DFID). The reports, of which this is the first on the Netherlands, will deliver consistent analysis of EU import and production data derived from Eurostat and a range of UN agencies, combined with statistics on other key criteria; supplier countries forest type (boreal, temperate, and tropical), FLEGT VPA status, and coverage by forest certification scheme and other systems of risk mitigation. It will also focus on corruption and national income levels. Data coverage, sources and assumptions The report includes the following data and assumptions for the Netherlands: Import data: qcovering softwood and hardwood logs, softwood and hardwood sawn, softwood, hardwood and combi plywood, softwood & hardwood veneer, particleboard, fibreboard, softwood and hardwood joinery products (flooring, doors, glulam, windows), and wood furniture. qderived ultimately from Eurostat but validated using FII s trade database system. qreported in euro value and quantity unit (m3 for all products except fibreboard and flooring, which are reported in m2). Production data: qcovering softwood & hardwood saw and veneer logs, softwood and hardwood sawn, softwood & hardwood plywood, softwood and hardwood veneer, OSB, other particleboard, MDF, hardboard and insulating board. qin cubic meters (m3) between 2007 & qsourced from UNECE Timber Committee database Total supply of solid timber products : q solid timber products include all those assumed This report has been prepared with the support of the Department for International Development If you have any comments on this report please contact: Rachel Butler, Independent Technical Advisor to the European Timber Trade Federation Tel: +44 (0) ; Mob: + 44 (0) ; Skype: raichbutler The report has been prepared for the ETTF by: Rupert Oliver, Forest Industries Intelligence Limited, The Little House, 18 Church Street, Settle, North Yorkshire BD24 9JE, UK Mob: +44 (0) ; rjwoliver@btinternet.com; Skype: rupert.oliver to be derived from saw and veneer logs. Composite panels, such as MDF and OSB, and pulp and paper products are not included as these derive from small dimension logs or wood waste material. While imported wood joinery and wood furniture products contain composite panels, for this analysis it is assumed they are solid timber. It is also assumed that all wood joinery and furniture comprises wood material, so RWE volumes for these products are likely to be overestimates. qreported in m3 round wood equivalent (RWE) calculated from quantity data (m3, m2 or tonnage) using standard conversion factors. qdata provided for 2007 and 2011 as the latter is the most recent year for which full annual data is available and 2007 was immediately before global recession, so a useful indicator of the impact of recent economic trends. qsources of wood product supply to the Netherlands are summarised by: wood type (softwood, temperate hardwood, tropical hardwood and indeterminate); major product group (e.g. logs, sawnwood, plywood); and region (e.g. domestic, other EU, N. America, S. America, CIS). 2

3 Introduction Total supply of wood products (in RWE terms) to the EU-25 and individual ETTF countries is summarised against the range of criteria relevant to EUTR implementation. Exposure to verified negligible risk This is a rough measure to identify gaps in independent certification and verification systems intended to mitigate the risk of illegal wood entering supply chains. It is based on the percentage area of certified or legally verified commercial forest area in each individual supplier country. For example, if 40% of its forest area is known to be independently certified or legally verified, the level of exposure to verified negligible risk of a country s wood products is assumed to be 40%. The certified/ verified forest areas are calculated by comparing data from the various certification and verification systems with UN FAO figures for areas of productive forest land. Level of exposure data is broken down by verification system, including FSC, PEFC, or system of legality verification (such as SGS TLTV, Smartwood VLO, or OLB). For this exercise, wood from countries covered by FSC-endorsed National Controlled Wood Risk Assessment is also considered verified negligible risk. To avoid double counting, areas dual certified to FSC and PEFC are accounted separately. Adjustments are also made for a few countries, such as Brazil and the USA, where there is a big difference in the level of certification in hardwood and softwood forests. The verification systems covered are summarised in the report Annex on Programs delivering verified wood products. The list is not comprehensive for private sector initiatives, and does not imply endorsement of a system s reliability by the ETTF or sponsors of this report. It only identifies independent third-party systems that claim to offer legality assurance. The initiatives identified also do not include systems of state regulation that may be at least as effective in eliminating illegal supply risk. Corruption Perceptions Index Each year non-governmental anti-corruption organisation Transparency International (TI) publishes a Corruption Perceptions Index (CPI) ranking countries by perceived levels of corruption, as determined by expert assessments and opinion surveys. This currently ranks 178 countries on a scale from 10 (very clean) to 0 (highly corrupt). The index is not perfect as, for example, variability in a country s score can result from both changed perception of a country s performance, or a change in the sample and methodology of surveys used. However, separate studies have found significant correlation between the CPI and other proxies for corruption; black market activity and over-abundance of regulation. A 2004 study of global illegal logging for the American Forest and Paper Association also suggested a strong relationship between independent estimates of suspicious log supply in different countries and CPI scores. The CPI is also seen by the FSC and PEFC as a useful starting point for identifying whether timber suppliers are high or low risk on illegality. EUTR-specific measurements In this report, exposure to corruption is assessed for both domestically supplied and imported wood products and wood supply to the EU-25 and individual ETTF member countries is classified into three types; low exposure to corruption from supply countries with a CPI of 7 or above moderate exposure to corruption from countries with a CPI of between 4 and 6.9 high exposure to corruption with a CPI of less than 4. World Bank Income Group The report summarises wood supply to the EU and ETTF member countries using the World Bank Income Groups, which are based on calculations of gross national income (GNI) per capita. The World Bank classifies every national economy as follows; high income (GNI greater than $12,475) upper middle income (GNI of $4,036 to $12,475) lower middle income (GNI of $1,026 to $4,035) and low income (GNI less than $1,025). This measure is used here to assess whether significant changes are underway in the proportion of wood sourced from high and low income countries. In the interests of equity, it is important to monitor the impact of the EUTR on trade flows with the world s poorest nations. EUTR might encourage a reduction in EU imports from poorer countries as buyers seek to minimise potential risks. Studies by TI suggest a strong relationship between levels of corruption and national income, so it is likely that risk of illegal logging will be higher in poorer countries. Suppliers are also likely to lack resources for independent legality verification. FLEGT VPA Licensed Timber This report assesses the proportion of wood imports by the EU as a whole, and by individual ETTF member countries, derived from countries that are currently negotiating or implementing timber licensing systems through Forest Law Enforcement Governance and Trade Voluntary Partnership Agreements (FLEGT VPAs). Under the EU FLEGT Regulation (2008), controls are established for entry of timber to the EU from FLEGT VPA countries. Once agreed, VPAs include commitments from both parties to halt illegal timber trade, notably with a license scheme to verify legality of timber exported to the EU. Under the EUTR, VPA-licensed timber does not have to undergo due diligence illegality risk assessment by companies that first place it in the EU (termed operators ) and no further risk mitigation action is required. By November 2012, six countries had agreed VPAs with the EU; Cameroon, Central African Republic, Ghana, Indonesia, Liberia, and Republic of Congo. A further six are negotiating VPAs; Democratic Republic of Congo, Gabon, Guyana, Honduras, Malaysia, and Vietnam. Fifteen more from Africa, Asia and Latin America have expressed interest in VPAs.

4 netherlands supply trends Wood supply For its size the Netherlands is an important consumer of forest products. Per capita consumption of timber products derived from sawlogs is estimated to be 0.54 m3/year, significantly higher than the EU average of 0.4 m3/year. However with little productive forest, the Netherlands has always been dependent on timber imports. Although overall wood supply to the Netherlands dipped in 2009 at the height of the financial crises, it has remained relatively more stable than in many other EU countries over the last 5 years. In 2011, the roundwood equivalent (RWE) volume of supply of wood products based on saw and veneer logs was 11.9 million m3, an 8% decline compared to 12.8 million m3 in Over the last five years, the Netherlands has become increasingly dependent on imports from other EU countries. In 2011, supply comprised 65% intra-eu imports, 30% extra- EU imports and 5% domestic wood production. In the past, Netherlands has been a relatively large importer of tropical wood products. However, the proportion of tropical wood in overall supply declined from 13% in 2007 to 8% in Wood production In 2011, sawlog removals from forests in the Netherlands were 549,000 m3, a significant increase on the previous year s level of 385,000 m3, but still relatively small compared to the volume of imports into the Netherlands. The rise in sawlog production in 2011 was mainly due to an increase in hardwood harvest. In 2011, two thirds of sawlog production comprised softwoods and one third hardwoods. The rise in sawlog production is mirrored by an increase in sawn timber production, which is partially dependent on imported logs, from 245,000 m3 in 2010 to 324,000 m3 in There are no veneer or plywood manufacturers in the Netherlands and only one small panel manufacturer which produces insulating panels. Panel production increased from less than 20,000 m3 in 2007 to 45,000 m3 in Import overview In 2011, the Netherlands imported 7.74 million m3 (RWE) of solid timber products from inside the EU and 3.59 million m3 from outside the EU. Imports from inside the EU were 1.4% higher than in 2007 whereas imports from outside the EU were 25.5% less than five years before. Sawn softwood is by far the largest commodity imported from within the EU, accounting for over 2 million m3 in 2011, with much of the volume from Sweden, Germany, and Finland. Sawn timber also makes up around 50% of imports from outside the EU, the largest component being softwood from Russia, but also including significant volumes of tropical hardwood, both rough sawn and mouldings, notably from Malaysia, Brazil, Cameroon and Indonesia. Plywood makes up around 20% of imports from outside the EU, much comprising temperate hardwood plywood from Russia and China, but also including tropical hardwood plywood mainly from Malaysia and Gabon, and softwood plywood, notably from Brazil. The Netherlands also imports a large quantity of wood furniture from outside the EU, notably from China.

5 netherlands supply trends Imports by supply region The most significant trend in Netherlands imports from outside the EU is the increased role of China. This is mainly because import volumes from China have remained quite stable over the last five years while imports from other parts of the world - notably Africa and South America - have declined. Meanwhile share of import volume from CIS countries, mainly Russia and Ukraine, and South East Asia has remained stable overall. Imports & FLEGT VPAs Countries having signed or negotiating VPAs supplied the Netherlands with 900,000 m3 (RWE) of timber in 2011, 26% of imports from outside the EU. VPAs have strong potential to fill the gap in risk mitigation options for products supplied to the Netherlands from South East Asia and Africa. FLEGT VPAs and equivalent legality verification systems are lacking in China, Latin America and Russia, which may be a challenge to EUTR implementation. Imports by income group Between 2007 and 2011, Netherlands imports from low income countries fell from 230,000 m3 (RWE) to only 10,000 m3. This was partly due to a several low income countries moving to lower middle income status in the intervening period and partly to a big decline in imports from Congo DR. Imports from lower middle income countries also fell in the five year period, mainly due to China moving to higher middle income status. Exposure of imports to legality verification The level of exposure to verified negligible risk for Dutch timber imports from The decline was mainly due from 69% to 66% between 2007 and outside the EU increased from 12% to PEFC certified forests in Belgium to 18% between 2007 and This being temporarily removed from the was mainly due to rising certified forest PEFC register at the time when data area in Russia and South East Asia was compiled for this report. This area during the intervening period, together has now been reinstated so in practice with Dutch imports from Latin America Dutch total exposure to certified wood switching to Chile where most forest is inside the EU has probably increased. PEFC certified. The level of exposure for Dutch The level of exposure for Dutch imports domestic wood increased slightly from from within the EU apparently declined 54% in 2007 to nearly 58% in 2011, all due to FSC certification of Dutch forests. This level of exposure data may under-estimate actual proportion of timber imported into the Netherlands from certified forests. The country is well known to have one of the most well developed markets for certified timber products anywhere in the world, boosted by far-reaching timber procurement policies promoted by the VVNH timber importers federation, and by national and local governments. As a result, Dutch importers are very likely to be taking a disproportionately larger share of the certified volume available in supplier countries. According to data from VVNH, of the 2.5 million m3 of timber imported by members in 2010, 71% was either FSC or PEFC certified. Photo credit: AHEC Imports and corruption Much imported wood derives from regions with both high perceived levels of corruption and low levels of certification - notably in Russia, China, Latin America and SE Asia. In Latin America, Netherlands is a relatively large importer from Chile which has low perceived corruption (and widespread certification). Some Dutch imports from within the EU came from countries with high perceived corruption - the largest volume from Italy.

6 netherlands imports Dutch imports of wood products were valued at 3.29 billion euro in 2007, fell 24% to 2.5 billion euro in 2009, rebounded to 2.74 billion euro in 2010, before weakening again to 2.72 billion in Wood furniture is the single largest imported commodity, representing 40% of total import value over the last 5 years. China is the largest single supplier of wood furniture to the Netherlands, accounting for 19% of all import value in However, around 62% of Dutch wood furniture imports come from other EU countries. Dutch imports of wood furniture have remained stable over the last 5 years. Sawnwood is the second largest imported commodity, accounting for 30% of import value over the last 5 years. Dutch imports of sawnwood fell sharply between 2007 and 2009 and have only partially recovered since. Sawn softwood mainly comes from other EU countries, but much also comes from Russia. Sawn hardwood is mainly from the tropics, notably Malaysia, Brazil and Cameroon. Plywood accounts for 9% of Dutch import value. Tropical plywood imports have been declining. Plywood imports from China have been rising. Source: Forest Industries Intelligence Ltd analysis of trade data supplied by Business Trade Statistics Ltd

7 netherlands imports Source: Forest Industries Intelligence Ltd analysis of trade data supplied by Business Trade Statistics Ltd

8 netherlands imports Source: Forest Industries Intelligence Ltd analysis of trade data supplied by Business Trade Statistics Ltd

9 This report has been prepared with the support of the Department for International Development If you have any comments on this report please contact: Rachel Butler, Independent Technical Advisor to the European Timber Trade Federation Tel: +44 (0) ; Mob: + 44 (0) ; Skype: raichbutler The report has been prepared for the ETTF by: Rupert Oliver, Forest Industries Intelligence Limited, The Little House, 18 Church Street, Settle, North Yorkshire BD24 9JE, UK Mob: +44 (0) ; rjwoliver@btinternet.com; Skype: rupert.oliver