Industry News

BVRIO report confirms widespread irregularities in timber from Amazon

The BVRio Institute (iBVRio) has published a new report about the legality status of tropical timber produced in the Brazilian Amazon.

According to the publication - available here - more than 40% of the forest management operations in the Pará e Mato Grosso states are likely to be involved in severe breaches of the law, including timber theft from conservation areas or indigenous reserves, use of slave labour, and/or laundering of stolen timber by defrauding the official control systems. Only 10% of the cases analysed by iBVRio did not show any indication of irregularity.

Theses findings were obtained through big data analysis conducted by BVRio's Due Diligence and Risk Assessment System, cross-checking a wide range of data bases of information gathered from 100% of the logging and timber processing operations in the Pará and Mato Grosso states (which together produce more than 70% of the tropical timber from Brazil) since 2007.

The report also contains a description of the regulatory process for companies operating in the Amazon, the main types of fraud practiced by illegal operators, a review of different approaches for detecting and preventing illegality and a review of the impact of illegal logging on reducing demand for tropical timber from the Amazon.


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Ghana and Indonesia close to get FLEGT green light, new study says

Ghana and Indonesia are almost ready to issue FLEGT licences to exports of verified legal timber products bound for the EU, says a new joined study by the University of Florida and University of Amsterdam.

The research authors, Christine Overdevest of the University of Florida and Jonathan Zeitlin of the University of Amsterdam, underline that, even before the start of FLEGT licensing, VPA (Voluntary Partnership Agreement) implementation has led to “substantially increased participation by civil society and other stakeholders in forest governance, greater transparency and accountability of forestry administration, and heightened recognition of community rights”.

As reported by, the benefits of VPA implementation to date include:

  • Support to small-scale producers: In both countries, the VPA process has focused attention on protecting the needs and livelihoods of small producers in the transition to the new timber legality regime – in Ghana through the domestic market policy and in Indonesia through subsidised group certification.
  • Improved capacity and control: The authors note that Ghana’s VPA timber legality assurance system has begun to transform the practice of the Forestry Commission, “enhancing its capacity for sustainable forest management through accelerated updating of plans and species maps, as well as for regulatory enforcement through the use of audit reports to detect and correct operational problems, including non-compliance with Social Responsibility Agreements.”
  • Closing doors to corruption: In both countries, the VPAs have helped improve administrative oversight in forest governance, including by curtailing the discretionary awards of concessions and harvesting permits, and have created new mechanisms for exposing corruption across the supply chain.

Zeitlin and Overdevest say the VPAs have gone far beyond their central aim of ensuring the legality of timber. In both countries, VPA processes have proven to be “remarkably incisive” frameworks for exposing and addressing broader issues through multistakeholder dialogue.

  • In Ghana, such issues include regulation of administrative permitting, payment of Timber Rights Fees by large concession holders, observance of Social Rights Agreements with local communities, and the construction of a legal small-scale milling sector to supply the domestic market.
  • In Indonesia, major issues addressed through the VPA process include integrated land use planning, reducing corruption in public administration and permit allocation, and recognition of indigenous peoples’ customary rights.

The researchers say the joint committees of EU and national representatives overseeing VPA implementation, with multistakeholder bodies reporting to them, have played crucial roles in addressing such issues by serving as “robust platforms for accountability, collective learning, and consensus formation”.

Overdevest and Zeitlin also highlight the ways VPAs have empowered civil society groups to expose gaps in VPA implementation, hold public authorities accountable for redressing them, and collaborate in developing mutually acceptable solutions.

“Civil society groups in turn have made an indispensable contribution to the effectiveness and legitimacy of the VPAs in both countries by feeding independent local knowledge about their on-the-ground operation into the joint review process with the EU on the one hand, while building domestic public and community support for their objectives on the other.”


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UK heavily reliant on softwood imports from EU, TTF Stats show

The latest Statistical Bulletin released by the Timber Trade Federation (TTF) shows how UK softwood imports heavily rely on trade with the EU.

Following on from 2015 trends, in the four months to April 2016, 92% of total UK softwood imports came from the EU. Sweden is by far the largest supplier of softwood to the UK market accounting nearly 50% of the trade with the EU. Other strong EU trade partners include Latvia and Finland.

Of non-EU countries, the great majority of softwood trade is with Russia which accounts for nearly 80% of the softwood imported into the UK from outside the European Union. Canada and Norway make up most of the remainder.

On a wider perspective, the volume of timber and panel imports to the UK was 5% higher compared to the same period of 2015, mainly due to an increase in the imports of panel products. Major growth sectors included Brazil - which saw a 31% growth in volume of softwood plywood exported to the UK compared to 2015 - and Indonesia which increased its export of hardwood plywood by 53% in volume.

However, the value of softwood imports declined over the same period in 2015 by around 7.5%: sawn goods were down by around 8%, while planed goods were 6.5% lower. This is linked to currency fluctuations during this period.

David Hopkins, Managing Director of the TTF, said: “These statistics show the continued reliance on trade with the EU for the softwood market, though other countries seem ready to increase their market share. We will be following these statistics up with an event in September looking at the potential impacts of the EU referendum vote on the UK timber trade and forecasts for the future.”


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State of UK Timber Market under lens in Tilhill Forestry Bulletin

Tilhill Forestry has published its new Timber Bulletin providing commentary and interpretation on key themes affecting the UK timber market.

The report explains that, while prices were down during 2015 for small roundwood, logs and standing timber, the first half of 2016 has seen a rebound driven mostly by the sawn fencing market and the weakened Sterling.

The vote to leave the EU and the potential impact of Brexit are also discussed in the Bulletin. The report states that the vote has created uncertainty in the market making timber imports more expensive. That could provide a boost for UK sawmilling compensating sector's vulnerability to economy and exchange rates.

Biomass and the panel sector seem to be less exposed to economic uncertainty although biomass will be hit hard by the reforms to the Renewable Heath Initiative (RHI) targeting residential and small commercial installations.

Another concern underlined in the Bulletin regards the insufficient tree plantation policy. Figures show that the private sector is dominating supply at more than double the state sectors combined. Even though the trend is set to continue, the forecast decline in availability of timber in the period 2027-31 is of concern to processors and growers alike.

Peter Whitfield, Timber Operations Director, commented: “The report clearly illustrates that the last year has been a turbulent one with many parts of our industry being negatively affected. However, it is not all doom and gloom; in the context of the global average, the UK has performed strongly and with exchange rates likely to be in our favour, it is forecast to continue to do so in comparison with other countries.”

To read and download a copy of the report click here.

Tilhill Forestry Ltd - a wholly owned subsidiary of the BSW Timber Group - is a national company providing a full range of consultancy and contracting services to UK forest owner and forestry investor.


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European sawlog prices down 9% since 2014

As reported by Wood Resources International, European sawlog prices have fallen over 9% in two years.

The biggest price declines since 2014, in Euro terms, have occurred in Austria, Germany and the Czech Republic.

Softwood sawlog prices in both Austria and Germany have been falling since early 2014, but in the 1Q/16 they reached their lowest level since the 2Q/10 (in Euro terms). In US dollar terms, the price decline has been more dramatic with current prices in the two countries being almost 30% below the average prices in the 1Q/14. Despite the substantial price reductions as of late, sawmills in Austria and Germany still have higher wood costs than lumber producers in the Nordic countries and in Eastern Europe.

The major European log supplying countries in 2015 and early 2016 have been the Czech Republic, Poland, Norway and Estonia. The average import price for spruce sawlogs has declined the past year and was about 10% lower in the 1Q/16 than in the same quarter last year.


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