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CTI broadly welcomes the Chancellor's Autumn Statement

The Confederation of Timber Industries (CTI), a representative body for the £10 billion timber supply chain in the UK broadly welcomed the Chancellor’s Autumn Statement today.

Speaking on behalf of the new umbrella body for the Timber Industries, David Hopkins, Managing Director of the Timber Trade Federation (TTF), stated: "The conditions next year are challenging, especially considering the continued uncertainty and the £122 billion loss that the OBR expects from Brexit. In light of this, we welcome the switch in focus from austerity to fiscal stimulus and opportunities in the real economy."

"Setting housing and infrastructure at the heart of our economic policy is good news and will have a positive effect on the timber sector. The Business Rates reduction package on the surface will give a boost, especially for our rural members though it may not adequately address the challenges that they face - we will be analysing the detail carefully."   

"The emphasis on productivity throughout is paramount and we very much welcome the National Productivity Investment Fund and initiatives to drive growth through LEPs and devolved administration and look forward to seeing more detail on how these plans will be enacted.” 

Iain McIlwee, CEO of the British Woodworking Federation (BWF) added: "The key word in the statement is Productivity and we need to drill into the detail here.The danger is that in the macro headline we lose some of the important micro drivers - we must remember that we are not always comparing apples with apples and I think herein the Chancellor has set a challenge to industries to do more to benchmark our own productivity."

"That aside, if we look at the key components of productivity, the Chancellor was quiet on Skills. Management Skills had some attention and we also heard heralded that there is a growing number of graduates - this is no doubt a good thing, but unfortunately used in this way we are reinforcing an emphasis on academic options. Part of the growth plan is to focus attention on quality apprentices and it is disappointing that this did not get highlighted in the same way." 

"The other notable omission was the whole natural capital agenda and given our recent pledges to the Paris Agreement we cannot let this take a back seat.  Resource efficiency goes hand in glove with productivity. We welcome the opportunity to work with the Chancellor and his team to demonstrate that effective carbon accounting can drive productivity and set the UK apart as a true global leader.” 


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CTI broadly welcomes the Chancellor's Autumn Statement

CTI broadly welcomes the Chancellor's Autumn Statement

The Confederation of Timber Industries (CTI), a representative body for the £10 billion timber supply chain in the UK broadly welcomed the Chancellor’s Autumn Statement.


Vietnam ready to ratify FLEGT VPA with the EU

On Friday 18th November 2016 EU Environment Commissioner Karmenu Vella and Vietnamese Agriculture and Rural Development Minister Nguyen Xuan Cuong reached an ‘agreement in principle’ on the start of a FLEGT VPA between the European Union and Hanoi.

The news was reported by the European Timber Trade Federation (ETTF) alongside an EU statement remarking that the ‘substance of the deal’ was agreed and pending ‘technical, consistency and legal checks’ ratification is expected to start next year. 

The Forest Law Enforcement Governance and Trade Voluntary Partnership Agreement (FLEGT VPA) will see the implementation of a comprehensive timber legality assurance system, greater stakeholder engagement in the Vietnamese timber and forestry industry, and establishment of a monitoring and auditing framework. Once these are complete and authorised by EU and Vietnamese authorities, the country will be able to FLEGT licence its exports to the EU, exempting them from further due diligence by operator importers.

The aim of the measure is to combat illegal logging and illegal timber trade out of Vietnam. The focus is not just on timber and wood products based on material from its own forests, but also the major volumes it imports from around 80 countries across the rest of Asia and further afield and then processes and re-exports as finished goods. 

The VPA covers all major timber and wood product groups exported to the EU and Vietnam will also undertake to apply its legality assurance standard and systems to domestic timber and wood product sales and exports to other markets.

Vietnam’s wood-based exports to the EU in 2014 were worth around $705 million dollars, or between a quarter and a fifth of its total. This puts it third after the US and China as the country’s most important timber export market, and its sales there in the first eight months of last year were reported at US$436 million.

"Vietnam and the EU today celebrate a milestone in their cooperation in the global fight to end illegal logging," said Commissioner Vella. "Now we must focus on implementation to ensure that the VPA delivers on its social, environmental and economic goals.”

He added that the VPA would require "credible and robust systems involving all stakeholders and including effective mechanisms to detect violations and ensure law enforcement."

“The EU will continue to support Vietnam's efforts in this regard,” he said, “and we will be monitoring closely how it works to implement the VPA.”

Vietnam is one of 15 countries currently negotiating or implementing FLEGT VPAS. On November 15 Indonesia became the first to complete implementation and start issuing FLEGT licences. Its first licensed shipments are en route and expected in the EU in coming weeks. 


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Wood pellet imports to the UK down 24% year-on-year

As reported by the North American Wood Fiber Review produced by Wood Resources International, wood pellet imports to the UK fell 24% year-over-year in August after record high imports during the first half of 2016.

The United Kingdom is by far the largest importer of wood pellets in the world followed by Denmark, South Korea and Belgium.

In the 2Q/16, the UK imported record volumes of just over two million tons, which was 11% higher than the previous quarter and 21% more than in the 2Q/15. Pellet producers in Southern US continue to be the major suppliers to the UK, accounting for about 50% of the total import volume in the 2Q/16. The other major supplying countries are Canada and Latvia.

Pellet manufacturers in the US South have been a reliable and steadily growing supplier to the UK over the past five years. In 2012, the UK imported less than half a million tons from the US and in 2016, shipments may reach more than eight times as much, according to the North American Wood Fiber Review. 

According to the North American Fiber Review, the surprising Brexit vote earlier this year to leave the EU is unlikely to impact near-term pellet exports from North America to the UK as supply contracts remain in place, and official negotiations regarding the EU exit process are yet to begin. However, in the longer term, the decision to stay outside the European Union could impact policy decisions regarding bioenergy incentives with subsequent market impacts.

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UK Wood products and Forestry sectors grew considerably in 2015, TTF Annual Review reports

According to the Statistical Review 2016 published today by the Timber Trade Federation (TTF), Timber Industry maintains its place among the larger UK manufacturing sectors and is listed in the top 10 fastest growing UK manufacturing sectors.

In details, 2015 saw a 11.4% growth in the value of wood products, compared on the previous year. Similarly, UK forestry and logging was shown to have grown by 20.4%.

"The growth rate in the wood and wood products sector also outperformed many related industries, such as furniture, plastics and the construction of buildings", the TTF Statistical Review reports. "Together, the forestry and wood products sector achieved a combined value of £9.5 billion in turnover."

However, these positive news are balanced by the "small contraction" suffered in 2015 by the timber market after two very strong years of growth. According to the TTF, the decline was mainly due to the general economic slowdown in the UK, Eurozone and across the globe.

"Having followed a general trend of growth from 2008 to 2014, domestic and imported wood consumption decreased in 2015 by 1.8%. This was predominantly due to changes in imported product consumption: Hardwood and MDF consumption decreased, whilst softwood remained stable and plywood and fibreboard consumption grew from 2014", the Review says.

"There were also decreases in UK exports, UK production and the share of UK produced timber consumption vs imported timber."

David Hopkins, TTF Managing Director, commented: “These statistics show the value and importance of the timber supply chain to the UK economy. This is a well-established supply chain, with great growth potential. However, like all other sectors we are dependent on a joined up economic policy approach across the country. The upheaval of Brexit may have caused uncertainty, but is also an opportunity for us to show our worth. If the Government is serious about creating an “industrial strategy” then we must put forward the case for the timber manufacturing sector providing skilled jobs in every constituency across the country. These statistics help us do just that.”

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