ETTFNews Winter 2015/16
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ETTF opens international trade gateway “Supporting growth, transparency and diversification of the international timber trade.” That’s the opening line of the Gateway to International Timber Trade, the ETTF’s new online timber sector legislation and industry information website. Launched on January 7, www.timbertradeportal.com is a ‘onestop information point’ for timber industry regulation and trade data in selected countries. The aim is to help international traders do business with suppliers worldwide and ensure that trade is legal.
André de Boer
Ghana is one of first Gateway profiles
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industry organisation and government contacts, and links to further information. The Gateway is supported by the International Tropical Timber Organisation (ITTO) and EU Sustainable Tropical Timber Coalition (STTC) and the site was developed by Dutch forestry and certification consultancy Form international. It draws on ITTO, FAO, ITC/ Tradecom and other databases, with a an ‘extensive network of experts providing input’. There’s a Review facility for visitor comment and countries can apply to be profiled. “It’s the first time timber sector information exchange has been organised and centralised on this scale,” said Mr de Boer. “It should ultimately lead to greater supply chain transparency.” The site currently has country profiles of Ghana, Ivory Coast, Indonesia and Guyana. Another 19, all expert reviewed, will be added this year. Pending support, the aim is to grow from there. “As the data builds, it will become an ever more useful timber trade resource,” said Mr de Boer, who presented on the Gateway at the last ITTO meeting in Japan. “We welcome comment and input for further development.”
Norway prepares for 2017 EUTR enforcement Norwegian timber businesses have held talks with their Environment Ministry on preparations for enforcement of the country’s equivalent to the EU Timber Regulation (EUTR) in 2017. According to Hans Thomas Blom of ETTF Norwegian Associate Member importer HF Blom, companies were told at the December meeting they had a year to get due diligence systems in place for the Regulation. “Officials also said they’re working closely with the Swedish government and that our EUTR approaches Hans Thomas Blom will be very similar” he said. “We understand company compliance inspections will be done by the Environment Agency.” He added that many importing companies were already implementing due diligence procedures. Norway says it is imposing its ‘EUTR’ to combat illegal trade, but also to facilitate timber business with EU countries by operating to similar standards. “With time it will be seen to be positive for serious importers,” said Mr Blom. “And I guess it should be an advance for exporters too.” Compliance should not be complex for the latter, he said.“Exports are mostly Norwegian-grown softwood, with nearly 99% of the forest harvested certified.” 02 Dutch Green Deal makes its mark 03 STTC website launches with ETTFmanaged procurement funding 04
French DDS gains momentum
05 EU importers back FLEGT-licensing 06 Young Greek architects show wood building talent
Contents
Against a background of increasingly strict rules to curb illegal timber trade, notably the EU Timber Regulation, US Lacey Act, Australian Illegal Logging Prohibition and Japan’s Goho system, ETTF members decided they needed a current, easy-reference tool on producer country legislation, particularly for tropical supplier states, where legality is most under scrutiny. The goal is to support importing companies in their illegality risk assessment due diligence and due care procedures under these new import rules, and help create a level playing field between small and large companies. “To meet their requirements, importers must obtain documentary evidence that suppliers are operating in accordance with national laws and regulations,” said ETTF Secretary General André de Boer. “So it’s essential they can readily access current information on those laws; how they’re translated at practical level and procedures they require. With the Gateway they can.” At the same time, the new site is designed as a versatile business tool, so users can source a range of useful data in one location. This includes industry figures, business,
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07 All change at UK federation 08 Danes head for new building heights 09 Italy making progress, says Fedecomlegno's Stefano Dezzutto 10 Back us on FLEGT, urges Indonesia's new generation 11-12 The viewpoints of Dirk Vennix of the UK's new Confederation of Timber Industries, Penny Bienz of the Soil Association and Confor's Bob Iwami 13-14 International Softwood Conference in focus and updated
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Green Deal does good – now the sequel The Green Deal initiative, aimed at making certified sustainable timber the Netherlands’ market mainstream norm, has gone a good way to achieving its goal in its three-year life. So said Paul van den Heuvel, Director of the Royal Netherlands Timber Trade Federation (VVNH) and Green Deal steering committee President, summing up the programme’s achievement as it ended in December. With the underlying aim of promoting sustainable forest management, it brought together 27 organizations across the Dutch timber sector, plus government and other organisations. "Our Green Deal impact study shows we’re well on our way,” said Mr van den Heuvel. “Participants have done a good job promoting sustainably produced timber and raised awareness across the timber sector, resulting in government and organisations becoming more open to using it.” But he acknowledged more needs to be done, notably to raise the certified proportion of Dutch tropical timber sales, which was just 40.4%, against 75% for other wood types last year. Consequently work is underway on the Green Deal sequel.
Danish Building Centre (Danske Byggecentre) is gearing up for the Byggerimessen, its major biannual event and Scandinavia’s leading construction products trade fair.
Paul van den Heuvel hands over Green Deal Impact Study to Cor von Meijenfeldt of the Economic Affairs Ministry
“We’ve worked closely with market partners, mapping the sector's strengths and problem areas in driving the sustainable timber market,” said Mr van den Heuvel. “Now it’s time to involve more parties, such as NGOs and local authorities. We hope to be a sustainable timber example throughout Europe!”
Italian style sets out for Shanghai As part of a ‘Made in Italy’ global sales drive, Fedecomlegno’s parent federation Federlegno Arredo is launching a satellite of its Salone del Mobile furniture fair in Shanghai. Salone del Mobile. Shanghai takes place from November 19 to 21 and aims to build on the status of the original worldrenowned Milan show. “It will promote the quality of ‘Made in Italy’, so huge effort is going in to create a high level event," said Fedecomlegno Chief Executive Stefano Dezzutto. Salone del Mobile.Milan President Roberto Snaidero said the trade fair was the culmination of a two-year research and development programme in the Chinese market. “I’ve always been convinced a trade fair would be a fundamental step in developing this market,” said Mr Snaidero. “We expect it to be as successful as our Saloni WorldWide Moscow event.” From January to September last year Italy’s Chinese exports rose 19%. By 2019 annual Roberto Snaidero growth is forecast to hit 40% .
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Europe meets at Danish building show
About 30,000 guests and 300 exhibitors are expected to converge from across Europe on the Fredericia fair complex for the March 1-4 show. “Byggerimessen is unique in bringing the Palle Thomsen entire industry together; from engineers and carpenters, to manufacturers,” said Danske Byggecentre Managing Director Palle Thomsen. He added that the exhibition has bucked the business trend to abandon face-to-face live events for remote, online communications. Byggerimessen continues to attract an ever-wider audience and the feedback from participants was that this is due to its ability to connect exhibitors and customers in a ‘personal, professional, hands-on way’. “It allows people space to learn about products, browse and make relevant contacts they can revisit later," he said.
For more: www.byggerimessen.dk
Finnish wood building on the rise The increasing prominence of high rise timber construction in Finland was acknowledged with the announcement that its first eight-storey wood building had won the country’s Wood Prize 2015, announced late last year. The Puukuokka apartment building in Jyväskylä was designed by Anssi Lassila of OOPEAA architects . The block fully exploits the potential of its pre-fabricated solid wood panel structure to create airy interior spaces, with large room spans. Wood modules were from Stora Enso, and timber façades Siparila Oy. Other multi-storey entries praised by the judges were Eskolantie in Helsinki and PuuMERA in Kivistö, Vantaa. The Public’s Choice Award went to House Åkerudden, by architect Mathias Nyström, a softwood-based eco-efficient country home. Meanwhile Helsinki Deputy Mayor Anni
Puukuokka building
House Åkerudde
Sinnemäki says she wants Helsinki to be in the vanguard of wood building, notably multistorey, welcoming a recent Finnish Supreme Administrative Court's decision enabling municipalities to zone areas for timber.
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New STTC website launches with funding programme
The STTC site features tropical timber application case studies PHOTO: Natrufied Architecture
Mark van Benthem
The European Sustainable Tropical Timber Coalition (STTC) is launching a new website in conjunction with the rollout of its initiative with the ETTF to distribute funding for sustainable procurement strategies to European companies, federations and local authorities. The STTC launched late 2013 with the aim of reversing the long-term decline in European tropical timber sales. Besides depriving Europe of a valuable raw material, it maintains, the contraction of this environmentally oriented market disincentivises spread of sustainable forest management in the tropics. It may even trigger forest land conversion to other uses. Late last year the STTC announced with ETTF it was moving to the next phase of its programme; directly supporting sustainable procurement action plans. “Concrete [procurement] commitment from companies is what creates real impact,” said ETTF Secretary General André de Boer, announcing the new initiative. Companies can receive match funding for projects in the framework of an STTC action plan for up to 30% of the cost or €15,000. Federations are eligible for up to €30,000 for developing a responsible sourcing policy or code of conduct. STTC partners can also submit other project proposals supporting STTC goals. Further details are on the new website,
www.europeansttc.com
The site also includes contacts, information on the STTC and its goals, and the overall environmental, commercial and technical case for growing the certified, sustainably
sourced tropical timber market. It features tropical timber case studies, from manufacturing to construction, comment from STTC supporters and links for further information. It also has STTC contacts and a feedback facility, details of current participants and information on how to become one. To date the STTC has gathered support from companies, federations, NGOs and government. It has set up working groups and supported projects focused on communications, business links, legality, sustainability and technical issues, including LCA study support. It also launched a website – www.houtdatabase.nl – on lesser-known certified tropical species. STTC attributes Europe’s declining tropical market partly to poor environmental image and a lack of awareness of its availability sustainably and legally verified. Its aim is to boost certified timber’s share to a ‘tipping point’ of 50% of EU tropical sales by 2020. “There’s increasing awareness that avoiding tropical timber does not ensure forests are conserved,” said Mark van Benthem, Probos Senior Advisor and STTC Consultant. “With verified sustainably sourced material we have a great story to tell, backed with impact studies and LCAs, showing timber is often the environmentally right choice.”
Swiss beech boost A pavilion in Swiss beech was a star attraction at the Swissbau construction fair in Basle, and highlighted options for using the hardwood in construction.
According to the Swiss Timber Industry Federation, around 18% of standing timber in Swiss forests is beech (fagus jura), but little is processed to lumber by Swiss mills. In 2014 95,000m3 of the raw wood sold abroad, half to Italy. Much is used for fuel. But while most Swiss timber building uses coniferous wood, the message from Swiss beech producers and promoters is that it now presents new possibilities in construction, notably for high rise. “It’s denser and stronger than coniferous wood, making it a prime choice for load bearing structures in lower floors, with potential to substitute concrete and steel,” said Federation Director Jörg Reimer. “It's plentiful and its backers say it’s time to exploit its potential.” Swissbau beech pavilion
Dutch, ETTF talk EUTR in Japan Dutch ministers, MPs and the ETTF urged Japanese politicians to implement similar anti-illegal timber regulations to the EU, USA and Australia during a seminar at the National Diet in Tokyo. The event was opened by Dutch Economic Affairs Minister Henk Kamp and addressed by Meriam Wortel of the Netherlands EU Timber Regulation Competent Authority and ETTF Secretary General André de Boer. “We argued that it was important for Japan, as a big tropical timber market in
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particular, to follow others and close its market to illegally produced material,” said Mr de Boer. “We also said the EUTR shows legisalation implementation costs are bearable and can be internalised in price.” The Dutch delegation also held talks with Japanese counterparts and NGOs. Japan is discussing developing its Goho government wood procurement strategy into a national market regulation. But two groups in the forest policy committee behind a private members bill have so far failed to reach agreement.
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French due diligence gains momentum Following its success gaining EU Timber Regulation Monitoring Operation status, French association Le Commerce du Bois (LCB) reports 12 members have implemented its due diligence system (DDS). Six more will start using it early 2016, with 40 expected to be signed up by the year-end. “Of the 12 registered, three have passed a DDS application audit and received their LCB Certificate of EUTR Compliance,” said LCB’s new EUTR officer Patrick Baraize, a chain of custody specialist with four years at FSC. The LCB is happy with this initial interest “Our DDS was only completed in May, so registration didn’t start until the mid-year,” said Mr Baraize. To encourage more to join the scheme, the LCB has ‘modified its fees’. “So even small operators can apply our DDS,” said Mr Baraize. “And we’re also suggesting members get their DDS third party audited on the same dates they’re controlled for FSC or PEFC chain of custody to reduce costs. That way it’s certain they’ll be audited every year for EUTR compliance.” LCB Director Eric Boilley said these early responses
to its MO services were “encouraging” and testimony to members’ environmental commitment". To support companies meet legality requirements, besides strengthening its team with the appointment of Mr Baraize, LCB has introduced a range of tools and support services. These include a checklist system for operators and auditors, listing key Patrick Baraize questions to ask at different levels of illegality risk assessment. It has also developed risk analysis methodologies, using a range of current data from NGOs, industry risk alerts, and producer country regulations.
First wave of Italian EUTR probes Initial investigations by the Italian EU Timber Regulation (EUTR) Competent Authority (CA) are expected to identify “administrative offences” by some operator companies, according to industry association Fedecomlegno. The CA, which is the Italian Agriculture and Forestry Ministry, launched its first wave of EUTR ‘controls’ in July, via the CITES operational units of the State Forestry Corps (SFC). It focused on higher illegality risk areas, but concentrating so far on the lumber sector rather than finished goods, due to the ‘simpler supply chain’. Risk was assessed in terms of country of origin and species. “The SFC verifies use of an updated due diligence system (DDS) and operators’ risk procedures,” said Fedecomlegno Chief Executive Stefano Dezzutto. “It requests evidence of risk assessment for identified products and risk mitigation, if necessary. Some documents were taken away for further study.” Members informed Fedecomlegno that the investigations are expected to uncover
some non-compliance in terms of “failing to put in place and maintain required due diligence measures and procedures”. But companies using EUTR Monitoring Organisation Conlegno's ‘LegnOK’ DDS, aren't expected to face problems. “The CA can impose administrative and criminal sanctions’ on offenders,” said Mr Dezzutto.
UK procurement advice body closure concern The UK government is being accused of not planning how the role of its timber procurement advisory body will be fulfilled when it closes in March. For 10 years, the Central Point of Expertise on Timber (CPET) agency has reviewed certification schemes and other legality and sustainability evidence against government timber procurement policy (TPP). Managed by an external agency, it also provided a helpline, website and workshops on TPP. Defra says from March these functions will be handled internally. But after a meeting between it, the UK Timber Trade Federation, NGO Fern and WWF UK, the latter said it was unclear how this would work. The organisations also discussed launch of a new independent successor body.
Refugee influx may support growth Germany’s timber trade is expected to show year on year improvement for 2015, with the country’s refugee influx among demand-boosting factors. However, growth was slower than in 2014 and varied widely between product categories, according to a report from German Timber Trade Federation GD Holz.
Sawn wood assortments and construction timber were squeezed on price
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A ‘busy autumn’ is expected to increase the figure slightly by the year-end, but to October the sector was just 0.9% ahead of 2014’s performance. “While interior doors and floors increased, solid wood assortments and garden products declined,” said GD Holz. “Sawn timber and other woodbased materials were also impacted by price effects.” It added that there is now improved demand for ‘assortments’ from local authorities for housing for Germany’s huge refugee influx. “Companies have the stocks and logistical capability to meet demand and will render any assistance for building refugee accommodation required,” said the Federation. Next year it predicts increased German building activity and said wider economic growth is also predicted. The refugee situation is also forecast to underpin demand, but by how much is unclear. “How this market stimuli will affect product categories, and price trends for 2016 remains uncertain” said GD Holz. “But the timber industry enters the New Year reasonably optimistic.”
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EU importers still favour FLEGT, despite licence delays EU timber companies are severely critical of the delay in launching Forest Law Enforcement Governance and Trade (FLEGT) licensing, but remain broadly supportive of the FLEGT initiative. That’s a conclusion from early research by the Independent Market Monitoring (IMM) initiative. Launched last autumn, the EU and International Indonesia is still Tropical Timber expected to be first Organisation-backed IMM to deliver FLEGT is contacting operator/ licensed timber, but importers for details of not to its predicted Spring deadline timber and wood products imported from FLEGT Voluntary Partnership Agreement (VPA) supplier countries, tracking EU/FLEGT VPA state trade and identifying potential obstacles to business development and other market challenges, such as product substitution. Starting with pilots in Germany, the UK and Spain, researchers Sarah Storck, Mike Jeffree and Carlos Kasner are also conducting interviews with timber and plywood businesses, NGOs, trade federations and end-users to gauge opinions of the FLEGT programme and its market development potential.
The fact FLEGT licences will exempt timber from EU Timber Regulation due diligence is seen as a potential commercial benefit. Survey respondents said it could boost trade flows with FLEGT licensing countries and give products a marketing edge. But delays in implementing licensing risked loss of interest. They acknowledged the complexity of the VPA process and the benefits it’s having on the ground in the 17 supplier countries engaged, but still said more pressure was needed to get licensed product to market. More communication was wanted too. “I want to know what FLEGT licenses will look like,” said a German importer. Plywood importers also said China and Brazil should somehow be more engaged in FLEGT. Positively, timber businesses believed VPAs could deliver fundamental change in supplier countries. “FLEGT is about an entire country implementing legality systems,” said a UK trader. “It involves more stakeholders and fundamental change than certification.” A German importer said: “These countries already have forestry laws – the EU is now helping enforce and improve them”.
UK timber building breaks barriers The latest UK Wood Awards showed more clearly than ever the growing range and ambition of timber in construction in the country.
Mixed picture on FLEGT CAs The UK Environment Ministry Defra says its FLEGT licensing Competent Authority (CA) is established, comprising Defra itself, the National Measurement and Records Office (also EUTR CA), the Border Force agency and Customs. It also has a FLEGT licence registration website and says it will charge £31 per licence processed. In most, but not all EU states, EUTR CAs will also have the FLEGT licence administrative role, and some, like Germany and Denmark, say they’re also ready. In others it's a less clear picture. The trade hope is that Indonesian FLEGT-licensed goods will ship this year, but a spring delivery deadline is not expected to be met.
ISC in Paris The 2016 International Softwood Conference takes place in Paris on October 13 and 14. It is being co-organised by Le Commerce du Bois and FNB, the French Federation of Sawmills, in association with the ETTF and European Organisation of Sawmill Industries (EOS). The venue will be announced shortly.
Punja is FSC Regional Director The BSkyB Building and The Observatory (inset)
The annual contest for timber in structural use, interiors, furniture and products is now among the UK’s foremost architectural and design competitions and 2015 winners were announced in November from 250 entries. At one end of the spectrum, the premier Arnold Laver Gold Award went to The Fishing Hut by Niall McLaughlin Architects, a boat house comprising an oak glulam superstructure, oak cladding and a larch
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batten roof. Another compact but perfectly formed winner was Small Project Winner, The Observatory by Feilden Clegg Bradley; a demountable artists' studio in structural softwood, modified Accoya and Tricoya MDF and charred timber for cladding. On another scale entirely were the Structural Award winner, the Canary Wharf Crossrail building in London, a station concourse canopy by Foster + Partners consisting of a 300m-long glulam gridshell from Wiehag of Austria. Just as striking was the glulam and timber cassette 3,000m2 BskyB Believe in Better Office by Arup Associates, featuring Austrian Spruce, Nordic Birch and British oak.
For more: www.woodawards.com/winners
Anand Punja has been appointed Forest Stewardship Council (FSC) European regional director, moving on from the post of Anand Head of Sustainability (HS) Punja at the UK Timber Trade Federation (TTF). In his new post, Mr Punja will facilitate liaison between Europe’s 18 national FSC offices. “I will support networking and exchange,” he said, “and I'll also liaise with other regional FSC directors to help deliver FSC global strategy in Europe.” Mr Punja joined the UK TTF in 2010. He was HS through implementation of the EUTR, and also involved in further development of the TTF’s Responsible Procurement Process (RPP).
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Contest reveals young Greek design talent Young Greek architects are being increasingly drawn to working with wood, and increasingly adventurous in its application in the built environment.
First prize winner
@ettf1 This was the verdict from the national architectural student’s Civil Design Award (CDA) for innovative wooden design. The contest is a cooperation between the Hellenic Timber Association (HTCA) and Hellenic Institute of Architecture. It launched last year after the former’s association with the cutting -edge ‘Hellastock’ architectural student contest in Piraeus. “The new competition was a huge success among all architectural colleges in Greece and Cyprus,” said HTCA President Christos Papanastasiou. “We had 80 teams and 57 final proposals. And the judges said that it was wood and the possibility to construct something entirely in it that intrigued students.” Entrants had to design a demountable display structure, and besides aesthetics, had to take into account the structure’s role, need for customization, assembly and disassembly issues. It required careful evaluation of the structural system, and construction economics. Innovation was also key. “All entries were considered highly inspirational and innovative,” said Mr Papanastasiou. “They also gave us confidence in the level of study and calibre of students in Greece’s architectural schools and optimism for the future of wood in Greek construction.” The first prize-winning entry, comprising a framework of softwood lattices, has been made full size by the HTCA and took centre-stage in an exhibition of all the designs at Athens Benaki Museum. It will now be moved to a permanent Athens location as a display booth for city events.
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TREE legality network meets in Czech Republic The Timber Regulation Enforcement Exchange (TREE), a networking body for EU Competent Authorities and others concerned with timber legality systems worldwide, holds its next meeting in the Czech Republic on April 4. TREE was established in 2012 by the Forest Trends Consultancy and UK Chatham House think tank. Its aim is to “support robust, consistent enforcement of demand-side timber regulations with a forum for officials to gain insight into timber flow risk and discuss enforcement issues”. It also links with producer country governments, industry representatives and other stakeholders in “combating illegal logging and promoting global markets for legal timber”. Co-hosted by the Czech Ministry of Agriculture, attendees at April’s meeting include delegates from 15 EU CAs, Norway, Switzerland, the US, Australia, the European Commission and Interpol. Also invited are representatives of the Indonesian SVLK agency, Japanese Forestry Ministry and governments of South Korea, Russia, Ukraine, Belarus and Balkan states. Country risk discussions focus on Cameroon, Peru, Myanmar and states on EU eastern borders.
ETTF to scale highest wood building The ETTF is holding its annual general meeting in Norway this year, and members are due to visit the world’s new tallest wood building as part of the trip. The agm takes place in Bergen, supported by Norwegian associate member, importer and distributor HF Blom. “We had an ETTF meeting in Oslo in 2010, the first one I attended, but nothing since,” said Hans Thomas Blom, who runs Blom with father Henning. An added attraction of Bergen is its Treet (Tree) building, which at 14-storeys and 49m, replaces Melbourne's Forte Tower as the world's tallest timber building. Treet was completed last autumn and, at November’s International Softwood Conference (p13), Ole Herbrand Kleppe of developers BOB described its construction as innovative. It comprises timber-based apartment modules made by Kodumaja of Slovenia in stacks fourhigh, with a surrounding glulam structural frame from Moelven of Norway. Every fifth storey has added glulam reinforcement, formint the ‘platform’ for the next four. The system, said Mr Kleppe, overcame possible height constraints of construction in cross laminated timber (CLT), the weight of which can cause compression issues. Architect Per Reigstad of Artec said 56 of the 63 apartments sold immediately, with buyers drawn by wood’s aesthetics and eco benefits – Treet is highly energy efficient and embodies 2000 tonnes of CO2. “We’ve had positive feedback from companies behind Treet about an ETTF tour,” said Mr Blom. “And the agm will probably include other industry visits too.”
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Toolbox consumer plans
Treet near completion
The ETTF, European Organisation of Sawmill Industries and timber trade federation marketing campaign representatives from across Europe are discussing development of The Wood Toolbox, the online panEuropean industry marketing resource. It has so far focused on trade and industry, providing a range of marketing material for download. Proposals are now to develop a ‘customer-facing aspect’, with one possibility a facility for architects and designers to upload timber application case studies. More will be announced soon.
ETTF strengthens funding At a well-attended ETTF agm in Amsterdam, after November’s International Softwood Conference, members agreed to raise Federation fees. It was decided additional funding was needed to cover a developing policy programme and future ambitions.
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UK TTF in compliance-centred change Major changes have taken place at the UK Timber Trade Federation, signaling a shift in strategy and move to greater member participation. The TTF has elected a new president and appointed a new chief executive. The former post has gone to Keith Fryer, 56, director of leading London merchant/ importer T. Brewer & Co. He regards ‘compliance’ as the “issue at the forefront of every traders’ mind”; from compliance with quality standards, to environmental regulation. The TTF changes, he said, were in line with that. “We're a unified industry and one piece of complacency, or one positive thing we do, from meeting standards, to education, impacts everyone,” he said. The major response to an increasingly compliance-centered market will be to replace the TTF’s product-focused committees with new ones for Quality, Standards, Risk & Reputation; Development & Training; Communication & Engagement; Membership & Revenue. This structure would be “more flexible and reactive”.
TTF regional associations would also be strategically involved under a more unified structure. “We must unite, to ensure timber’s message is heard,” said Mr Fryer. The new TTF Managing Director,David Hopkins, 42, was head of the Wood for Good marketing campaign since 2012, where he led the Wood First and Building with Carbon campaigns to promote timberbased construction and ‘put timber’s low carbon properties at the front of the European agenda’. He is also chairman of the European Wood for Growth marketing initiative and addressed EU decision makers on the carbon topic at the 2014 Brussels Wood Action Days. He wants the TTF to be more responsive to member and market needs, and "help the whole chain function smoothly.” Wood for Good is appointing a new director, but Mr Hopkins will still be involved.
Forum focused on building tropical trade
ATIBT delegates at Milan Expo
European barriers to tropical timber trade, including inconsistent application of the EU Timber Regulation (EUTR), were among key topics at the International Forum of the ATIBT (International Tropical Timber Technical Association), late 2015. The event also looked at prospects for diversifying and growing the sector by broadening timber’s applications and improving specifier perceptions, with ATIBT holding its inaugural architects’ workshops. The event was in Milan to coincide with Expo 2015, which featured several timber-based pavilions. It attracted 190 delegates from 21 countries, plus 280 architects and specifiers. The core theme was developing tropical timber trade as a viable business and means of maintaining forest and biodiversity. This, said delegates, demanded new markets, less red tape and improved trade regulation. In discussions on EUTR and due diligence, ETTF Secretary General André de Boer described the former as a “broadly welcome” tool to combat illegal timber, which was “bad for brand image and undermines competitiveness of legal supplies”. The problem was uneven enforcement and due diligence variation, which hit EUTR credibility.
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The ETTF pressed the EU to focus on uniform application in its recent EUTR review. It was also focused on consistent practice in its own pan-European EUTRaligned due diligence system. Stefano Cora, president of Italian federation Fedecomlegno, said a balance was needed between over-strict due diligence demands of some countries and “basic declarations” of others. The ETTF also urged FSC and PEFC certification to be recognised as an EUTR ‘green lane’, replicating Australia’s approach under its illegal logging prohibition. Mr de Boer additionally detailed the ETTF’s new ITTO and STTC-backed online database, combining business information for mainly tropical producer countries and details of their forest and timber legislation relevant to EUTR due diligence(see p1). The architects’ workshops covered tropical timber’s building potential and benefits of sustainably sourced material use.
Keith Fryer
David Hopkins
Belgian federations in publishing promo Two glossy magazines, highlighting design, performance and environmental strengths of timber have been co-produced by two lead Belgian federations. The promotional publications are a joint effort between ETTF members the Belgian National Union of Timber Businesses (UNEBO) and the Belgian Timber Importers Federation (BFHI). ‘Du bois chez moi’ (Wood at Home), is distributed in consumer home-style titles, Gael Maison and Feeling Wonnen. A total of 55,000 are going out, including articles on furniture, construction, flooring, cladding and other domestic wood uses. There are also interviews with designers and pieces on the environmental impact of competitor materials. The second title, ‘Forum du Bois’, is for architects, with 10,000 copies distributed in architectural journal Dimension, which reaches 80% of the profession in Belgium. Content includes environmental certification, large scale use of cross laminated timber and other wood-based building case studies. There’s opinion from architects and links to timber building events. and it directs readers to technical and sourcing website www.bois.be BFHI General Secretary Bart de Turck said the impact of the magazines would be monitored. “If findings are positive, they may continue,” he said.
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Wood heads up in Danish building Timber is becoming the centre of attention in Danish construction, with three new projects underway to promote it as a core building material.
Industry and NGOs call for EUTR reinforcement Around 100 representatives of the EU timber sector, NGOs and national governments met the EU Environment Commissioner in Brussels in Novermber to back WWF calls for the EU Timber Regulation (EUTR) to be reinforced.
Impressions of new timber apartments in Lisbjerg by Copenhagen architect Tegnestuen Vandkunsten
The Danish Timber Trade Federation (DTTF) is involved in all three initiatives, which, it says, seek to identify and overcome timber construction obstacles as well as exploit opportunities. Underway at the Danish Technological Institute is the ambitious “Multi-storey wood building in Denmark” venture. This brings together private operations and organisations across the wood sector, the aim to construct a timber-based high-rise and analyse and explore barriers to the use of wood in the process. The second project is ‘Go2Wood’. Initiated by Chora Connection, a think tank focused on resilient, environmentally sound social development, its aim is to devise strategies for making the building sector more sustainable. With funding from Velux Foundation, Go2Wood has already approached the Buildings Ministry with recommendations to
modernize fire regulations within the Danish Building Code and introduce a threshold value for building climate impact. This would be based on life cycle assessment, underlining, said the DTTF, that “wood is a superior building material”. The other initiative is funded by the Ministry of Transport and Building and comprises analysis by research institute Damvad into the potential for increasing use of wood in Danish construction more widely. “All three projects point to a promising future for timber,” said DTTF Director Jakob Rygg Klaumann. “The timber highrise movement is developing rapidly in neighbouring countries, but not Denmark. We want to be part of that revolution too, and demonstrate the wider possibilities of timber in modern, sustainable Danish construction.”
Suriname mission highlights certified trade potential Seventeen European importers from six countries participated in an ETTF-backed trade mission to Suriname where they learned about the opportunities and challenges for developing the country’s sustainable timber export sector. The visit last November was co-initiated by Suriname Environmental Services and Support and backed by the European Sustainable Tropical Timber Coalition (STTC). The aim was also to put participants in touch with Suriname trading partners. Participants additionally learned about the role of the Surinamese Foundation for Forest Management and Production Control (SBB) in monitoring and law enforcement. Mission participants in the forest
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More than 400,000ha of Suriname’s forest have been FSC certified in recent years, supported by the Guiana Shield Tropical Timber Program and Dutch Sustainable Trade Initiative (IDH). A further 43,000ha are certified to FSC controlled wood standard. Since 2010, Suriname’s industrial roundwood harvest has also nearly doubled to 493,000m3, with Europe accounting for 38% of its 21,000m3 of sawnwood exports last year. To make the most of the Suriname forest sustainably the message was that the trade must accept more of its 1000 species – with a project underway to bring lesser-known ones to Europe. Backed by FSC-certified companies in Suriname, the ETTF, Probos and Tropenbos Suriname, this will run a pilot to assess availability and performance. Mark van Benthem Senior Advisor at Probos, who accompanied the visit, said all participants were ‘excited’ at the possibilities presented. “Such a mission is worth repeating,” he said.
The meeting followed September’s WWForganised Industry Statement. This was signed by over 65 companies and seven industry associations, including the ETTF and member federations. It urged the European Commission to use its 2015 EUTR statutory review to extend its scope to more timber and wood product categories, highlighting that less than 50% of the EU’s €54 billion annual imports are covered. It also demanded more uniform enforcement. “The meeting with Commissioner Vella showed business backs our shared EUTR review asks,” said a WWF spokesperson. They added that 41 trade representatives attended from 32 companies and associations and 10 countries. The paper sector, most of which wants currently exempt printed paper to be brought under the EUTR, was represented by the Confederation of European Paper Industries. The WWF said the commission viewed it and supportive businesses as "serious stakeholders in the review process” and was confident calls for EUTR reform would be heard. The Commissioner said they “shared Commissioner a desire for action, Karmenu Vella not words on illegal logging.” Bart de Turck, General Secretary of the Belgian Timber Importers Federation, attended with member companies. He said there was still scepticism about getting certain EUTR aspects changed. “It may be extended to niche products, like musical instruments, but there are doubts printed paper, for instance, will be covered,” he said. “That reflects the lobbying strength of EU users, notably the media.”
Bart de Turck with fellow delegates and logos of companies backing a stronger EUTR
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Interview
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Making the most of made in Italy Stefano Dezzutto
Global downturn hit the Italian timber sector hard, and it has had to meet legality and environmental challenges as it recovers. But, by combining evolution with traditional strengths, it is making progress, says Fedecomlegno Chief Executive Stefano Dezzutto. ETTF: What is the state of the Italian economy and timber sector?
Timber is used increasingly used in Italian schools, as here at Asilo Guastalla Photo: Fausto Franzosi
Stefano Dezzutto: After nine quarters of downturn, 2015 confirmed positive signs glimpsed in 2014. GDP returned to limited growth and even employment rose. Youth unemployment and our north/south economic gap are worrying and we can't yet confirm building recovery. But, even if consistent construction upturn isn’t forecast until after up to two years’ GDP growth, mortgage and real estate sectors are improving.
ETTF: Is timber in Italy selling on its environmental benefits generally?
ETTF: What are key markets for your members and which are performing best?
SD: No. It’s still not a consumer requirement.
SD: Italy’s traditional strength is transformation of wood from around the world into quality, high-design finished product for domestic and export sales. So traders source from numerous countries globally to supply the joinery industry. Many smaller joiners suffered in the crisis and only those which grew exports emerged stronger. But, while the downturn hit wood imports and consumption, it also offered development opportunities and the "Made in Italy" brand and design remain appreciated worldwide, which is why we must continue to honour them.
ETTF: Is timber-based building increasing?
SD: Italian construction permits slumped from over 250,000 in 2005 to under 50,000 in 2014. But our Federation research centre showed timber building growing in absolute terms. So we’re confident of the trend towards it and that it will increase with wider economic recovery. Italy builds over 3,000 wooden buildings a year; over 55% timber frame, 40% in x-lam. Although with major import competitors, notably Austrian, Italian engineered wood has limited share.
ETTF: Does government incentivise wooduse in building?
SD: No, but wood’s environmental and healthy living properties are encouraging public specification, notably in education. And over 60% of our 50,000 schools need refurbishment, a potentially significant market.
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SD: We strive to capitalise on wood’s wider environmental benefits, but general performance and economics still mainly dictate buyer choice. But a key building lever is now energy performance and wood’s seismic resilience has seen it specified in postearthquake rebuilding.
ETTF: Is certified timber’s market share up? ETTF: How is the EUTR viewed, how strict is Italian enforcement and how is Monitoring Organisation (MO) Conlegno developing?
SD: The EUTR has caused problems for members and is among our most debated topics, but Conlegno is supported as EUTR MO. Its third-party status helps engage all stakeholders, and its due diligence system stipulates decisions are made by technical committee, drawing on the resources of universities, industry and NGOs, including WWF Italy’s Traffic network. Use of the MO is growing with applications for DDSs from international-level businesses. And while EUTR application is uneven internationally, policing is strengthening in Italy. We were also the first federation to run a public awareness campaign.
ETTF: Does Italy broadly support the EUTR? SD: Members are in favour of it and the focus on legality issues it’s generated. But we mustn’t put all the responsibility on operators, especially with high-risk sources. We must agree Europe-wide operator approaches and drive the launch of FLEGT licensing in supplier countries to provide guaranteed-legal, EUTR-exempt timber. During the recent EUTR review, our key demands were creation of level playing fields in enforcement nationally and internationally; extension of the Regulation to more products; clarification of environmental certification’s role under it; and acceleration in progress to FLEGT VPA licensing.
ETTF: Is there concern the EUTR impacts tropical timber sales in particular?
SD: Italy’s tropical sawnwood sales fell from 400,000m3 in 2007 to 100,000m3 in 2014. The EUTR may have been a factor, influencing trade and public opinion. But recession was involved, too, plus tropical timber is handicapped by underlying lack of awareness of its performance and specifiers’ exclusion of it from structural application.
ETTF: What is the benefit of your affiliation to FederlegnoArredo ?
SD: Today many issues are common to different associations and businesses. FederlegnoArredo, as a network for leading industry associations, facilitates joint projects and promotes cross-sector interchange. It also manages important fairs, like Made and the Salone del Mobile in Milan, for the wider trade.
ETTF: Are generic timber marketing and promotion core Fedecomlegno activities?
SD: We’re involved in many projects, but the main ones are Fedecomlegno and Assolegno’s long-established training and promotion collaboration with Pro-Holz Austria, with its particular focus on wood construction. We’re also jointly funding a structural wood professorship at Trento University.
ETTF: What are the challenges and opportunities ahead for your industry?
SD: We’ve had to undergo major changes and product development in response to consumer trends and a financial crisis that hit Italy hard. The process continues. Traders must advance technically and focus on product legality and environmental benefits. Manufacturers need to seize opportunities in a building sector demanding lower environmental impact and energy use and specialized timber engineering for larger projects. And Italian furniture has to promote "Made in Italy" quality and style increasingly effectively worldwide. We're having to make great strides to ride the recovery.”
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New voices from the forest
Light through Indonesia’s haze
Choking smog from illegal land clearance fires is evidence of ongoing problems, but Indonesia is making forest governance progress through its own reforms and its FLEGT Voluntary Partnership Agreement with the EU. That’s the view of forestry researcher Citra Hartati, 29, in the latest of a series ofinterviews by Mike Jeffree with the new generation working in the forest sectors of FLEGT-VPA supplier countries. “Indonesia still has much to do to achieve fully legal, sustainable forestry and timber industries. Still only 60% of our 122 million ha of forest operates verified legitimately and we live with the consequences.. My interest in these issues stems from growing up in Sumatra where there’s been massive land clearance for oil palm plantations, often using fire. The result is severe aerial haze pollution and associated environmental, health and economic impacts – it forces airports to close and kids to wear facemasks to school. Experiencing this, you're naturally concerned for the future of the forest and environment. And forest fire is just one of our problems. Others include illegal logging, corruption and poor land use and wildlife planning. The root of all these issues is poor governance. And ineffective implementation of our Public Informations Disclosure Act, means we lack transparency, so there's also insufficient stakeholder engagement communication and awareness of the issues. But Indonesia’s Government has attempted to tackle some problems with new policies and regulations. There has also been stakeholder engagement capacity building and environmental issues have gradually become a greater priority and a healthy environment increasingly recognised as everyone’s constitutional right. This is reflected in more environmental legal cases and appointment of Supreme Court-backed environmental judges. There has also been improvement in governance through Indonesia’s SVLK Timber Legality Assurance System (TLAS). This has the capacity to ensure all timber and timber products are legally sourced, provided SVLK permits are policed and issued only by the right body in the right forest ‘function’ area Our Forest Law Enforcement Governance and Trade Voluntary Partnership Agreement (FLEGT VPA) is another positive – a way for Indonesia to share best practice with the EU to improve forest governance.
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It’s a pity FLEGT licensing is not yet in place, but as a civil society organisation representative on the VPA Joint Implementation Committee (JIC), I can vouch the process is encouraging broad stakeholder participation, including civil society. It's too early to say what all the benefits will be as FLEGT-licensing has not yet started, but I believe the FLEGT process is also helping to build on the work of the SVLK and clarify operation of our TLAS. And the initiative continues to make progress. At the same time there are aspects we’d still like to know more about. FLEGTlicensed timber will, of course, be exempt from due diligence under the EU Timber Regulation (EUTR). So I’d like to know how well the EUTR is being enforced and EU stakeholders are engaged. For FLEGT to work, a strong compliance mechanism in the EU is a must too and buyers who continue to accept timber from illegal sources must be penalised. I’d also like to know about the new [EUand ITTO-backed] Independent Market Monitoring project (IMM), which is assessing trade flows from VPA countries like Indonesia to the EU, and EU trade perceptions of FLEGT licensed timber’s market prospects. We have to consider the commercial aspects as well as the green line. What are market incentives for exporters to supply FLEGT licensed timber? Will it be prioritised by the EU industry? How will it be regarded relative to products certified under schemes such as the FSC and PEFC? There are responsibilities on both sides with the FLEGT initiative. VPA supplier countries like Indonesia must ensure TLAS’s and licensing systems are effective, while EU consumer countries must give market support to licensed timber and ensure businesses only buy from legal sources. However, overall I am optimistic. It will take time, but there are many willing and committed people in this sector and we now have the tools ultimately to ensure
Left: The Sumatran forest is often shrouded in haze from land clearance fires Via FLEGT and other mechanisms, Indonesia’s timber sector can become a model of legal, sustainable operation for other sectors
every piece of timber Indonesia delivers to market is legal. Together I’d like to see us make Indonesia’s tropical forest the most sustainable in the world. And if we set this example in environmental governance, other industries, like mining, gas and oil, will follow. I also believe in intra-generational environmental justice. We’ve experienced the results of poor environmental management. We owe it to our children to ensure it gets better than this.” Citra Hartati
Citra Hartati studied law in Jakarta. She has been researcher for the Governance of Forests Initiative Indonesia and the Land and Forest Governance Index (LFGI) of The Asia Foundation. She is now a forest governance legal researcher at the Indonesian Center for Environmental Law (ICEL) and a civil society organisation representative on the Joint Implementations Committee for Indonesia’s EU FLEGT VPA.
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Viewpoints
@ettf1 The CTI embraces the wider timber and forest products supply chain
One timber voice, one timber vision Across Europe the fragmentation of the timber sector is seen as limiting its influence with decision makers – hence the importance of the ETTF. The launch of the UK’s new Confederation of Timber Industries is another move to give the sector more cohesion and influence. And, says Chief Executive Dirk Vennix, it's gaining momentum.
Dirk Vennix
“As the UK’s pan-supply chain Confederation of Timber Industries (CTI) takes tentative steps into its first New Year, we’re reflecting on strides made so far, as well as the leaps we’ll have to take over hurdles ahead. Last summer 30 timber and forest product and related sector organisations came together to launch the CTI as an umbrella body for the wider sector. We've since doubled in size, providing a more prominent platform to deliver our vision: a single voice for a more prosperous industry. To help turn the vision into reality, the CTI Board produced a business plan for 2015-2017 addressing four strategic themes: stakeholder engagement, growth, skills and sustainability. Engagement with governments and parliaments aims to win support for growth, skills and sustainability. We’re planning a stakeholder conference with ministers, parliamentarians, industry executives and other stakeholders from across Europe, and we’ve formed a UK parliamentary timber industries group. Engagement with Brussels is high on the agenda too. Across our supply chain, businesses have endured tough economic times and
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are only just seeing shoots of growth. To help revive and grow the sector, CTI will assess markets and look to develop new partnerships with local government, construction and manufacturing sectors. Another issue is not enough young people joining the timber industry and part of the problem is insufficient training provision. The CTI has commissioned analysis of industry skills and education needs and is targeting increased take-up of timber-related courses. We will also highlight timber’s potential contribution to UK carbon reduction targets. And we’ll support members in their quest to ensure consistent application of certification standards and implementation of timber related regulation in the EU. Notably, CTI will publish a report on sustainability and quality standards, including analysis of the EU Review of EU Timber Regulation (EUTR). Everyone agrees the EUTR is a valid tool to tackle illegal logging and trade, but it is clearly undermined by loopholes and exceptions – for instance, the fact that seat products, musical instruments, soft furnishings and toys have been outside its scope. The UK Timber Trade Federation’s estimate puts EUTR coverage to date at just 40% by value of EU forest product based imports. CTI members believe that there is substantial scope for improving the EUTR, We want more consistent standards, clear due diligence requirements and fair competition between companies in different member states. And we strongly support European and national trade associations already working on the issues surrounding timber regulation in Brussels. Our three reports will be published at our conference in May 2016. To get results on key strategic themes, the CTI will need to maintain a marathon runner's training regime. We’re looking forward to working with UK and other European partners to win the race for the benefit of the whole timber supply chain.”
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MO backs all-embracing EUTR approach In January 2015 the Soil Association was approved by the European Commission as one of the first five Monitoring Organisations for the EU Timber Regulation able to operate EU-wide. Technical Manager Dr Penny Bienz says its client timber companies want straightforward guidance on legality due diligence and a safety first approach on EUTR compliance. “As an EU Timber Regulation (EUTR) Monitoring Organisation (MO), the Soil Association has to provide companies with a due diligence system (DDS) that comprehensively meets its legal requirements. But we also need to offer further compliance guidance, support and training. Penny Bienz As Beck Woodrow, our MO contact point, has discovered, most queries on EUTR due diligence concern adequacy and authenticity of legality documentation and there's also uncertainty over which products are covered. Moreover DDSs need to be user-friendly for businesses of all sizes across the supply chain. Some companies also adopt the safeguard of implementing due diligence on all products, including goods for which they only act as trader. That’s not a legal requirement, but may be due to perceptions that EUTR implementation is not consistent across the EU. Consequently some companies want risk assessment back to source in all cases . The timber and timber products covered by the EUTR are stipulated in its annex by customs Combined Nomenclature code. Currently they account for less than 50% of EU timber imports by value, leading to calls for the recent European Commission (EC) EUTR review to reduce the number
continued...
Soil Association finds many traders, as well as operators, exercising due diligence
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MO backs... continued of exemptions, including at least some of the more ‘obvious’ omissions. These include books, magazines and newspapers, previously exempt packing material, charcoal, and timber bought or sold by private individuals for personal use. We, in fact, already advise companies to include all products containing any timber derivative within their due diligence system. Currently our MO clients comprise six companies in Romania and one each in Denmark and France. In all cases, they have been deemed as implementing satisfactory due diligence systems and issued a certificate which includes the statement; ‘Appropriate risk mitigation has been carried out where necessary to establish as far as possible that Company X's products carry a
negligible risk of illegal origin.’ This is valid for five years, subject to annual renewal and compliance with corrective action requests, so not dissimilar to requirements of international forest certification schemes, such as PEFC.
Japan’s domestic lumber promotion opens import opportunity
Government support for the forestry and timber sector in Japan is intended to drive construction consumption of domestic wood species. But, in boosting wood demand overall, it should also create opportunities for overseas suppliers, says Bob Iwami, Interfor Corporation General Manager, Export Sales
"The Japanese government has become increasingly active supporting use of domestic wood species across construction. The backing for Sugi (Japanese cedar), Hinoki (Japanese cypress) and Karamatsu (Japanese larch) has been primarily via subsidy and has helped revitalize the domestic wood industry, but it’s also expanded the infrastructure and mindset of Japanese construction towards using more wood overall. Despite its relatively small size – 378,000km2 – Japan is among the world's largest lumber markets, consuming about 28million m3 of sawn lumber annually (Forestry Agency Japan, 2014). Japan’s wood-frame housing market is the primary lumber end-user and its needs are satisfied in part bythe country's vast forests which cover 66% of land surface. Demand during and after WWII resulted in clear cutting most of this area. But in 1946, to prevent further environmental damage, the government mandated reforestation projects
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We’ve also noted a certain amount of ‘smartening up of appearances’ by some larger operators and their suppliers in audits since the EUTR came in. Initially they would submit letters or ‘declarations’ from suppliers stating compliance with the legislation and that sourcing information would be provided on request. More recently it’s standard to see timber species and country of origin included in supplier sales documents automatically. I believe this is the most positive outcome of the EUTR. That suppliers provide additional legality information to customers, without waiting to be asked. This wasn’t due to certification, but well thought-out legislation applied to all EU timber companies. I now look forward to the results of the EUTR Review and its verdict on product category extension and the overall impact of its implementation so far.”
Sugi logs
Sugi forest
Bob Iwami
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to plant fast-growing Sugi and Hinoki on 4,000km2 of land annually. Today, 41% of the country’s forests are second growth, 60% of which are ready for harvest. Post-war economic growth and lack of domestic supply forced open the market for imported logs and lumber. In 1955 imports were under 10% of Japanese market share. At peak in 2002, this rose to 82%. But now, through its subsidy programmes, the government is aiming for 50% national self-sufficiency. Further incentivized by the need to utilize mature forests and revive rural economies, national, prefectural and local municipal governments have been injecting massive funds and grants in the form of subsidies. For example, the Forestry Agency, part of the Ministry of Agriculture, Forestry and Fishery with an annual budget of over 250 billion Yen (€1.9 billion Euro), supports public and private sectors to improve, restore and accelerate Japanese forest industry revival.
Private forest landowners with mature Sugi stands can receive subsidy for logging road construction and companies building operations to consume domestic logs (such as lumber, glulam or CLT plants and biomass electric generators) can obtain Forestry Agency funds to cover most of the capital cost, plus a tax shield from local government. A prominent subsidy recently has been the “Wood Use Points Program”, launched by the Forestry Agency in 2013 with a budget of 56 billion Yen. This was designed to subsidize use of local wood products in housing. When a new house is built with more than 50% local wood products, homeowners can receive 600,000 points (worth 600,000 Yen) for wooden furnishings to finish the property. The sudden demand for Hinoki for sill plates that this triggered at the outset doubled prices in two months. But thanks to pressure from the World Trade Organisation and action by the USA, Austria, Sweden and New Zealand, selected species of theirs have also been included in the Wood Use Points Program. What we’ve also seen in the marketplace is that these subsidy programmes also promote general use of wood products, domestic or imported. End users are choosing wood over other products. Their choice between Japanese species or imported lumber is down to competitiveness, ease-of-use, consistent quality and delivery in a sustainable manner mid- to long-term."
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Interview
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Post recovery softwood aims to be high achiever
The softwood industry is still shaking off recession in some areas, but sees major market possibilities ahead. Those were central conclusions from a dynamic International Softwood Conference. Mike Jeffree reports. The International Softwood Conference reflected a softwood sector becoming increasingly globalised, and contending simultaneously with market, structural and technical change. So it ranged widely; from global market shifts and wood construction to sustainability and bioenergy. The view of the November Amsterdam event was that softwood is largely through the recession, but remains in recovery mode and facing some ongoing challenges. The global speaker line-up identified new pressures from post downturn output increases. Seismic changes in countries’ trading influence were also still underway, notably China’s continued emergence as a dominant global market shaper. But ISC presenters pinpointed developments the industry could capitalise on too, including emerging markets and new international industry structures and trading patterns. The rising significance of sustainability, low carbon ‘bioeconomics’ and ‘green’ building were also cause for optimism. Andreas von Möller, Rupert Oliver and Sampsa Auvinen
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An increasing tendency to industry-wide cooperation and mutual support was seen as another positive. This trend was witnessed by presentations from paper, pulp and pallet sectors, and the fact that the ISC was again co-hosted by the European Timber Trade Federation (ETTF) and European Organisation of Sawmill Industries (EOS). With the Netherlands Timber Trade Association (NTTA) as national hosts and former UK Timber Trade Federation Chief Executive John White as moderator, the ISC itself was also seen as an encouraging market indicator. It attracted over 140 people and there was enthusiastic audience participation in delegate workshops on marketing, biomass energy, logistics and online trade. The opening global market overview from analyst Rupert Oliver of Forest Industries Intelligence pictured an industry in broad upturn. “World softwood trade rose from 275 million m3 in 2010 to 315 million m3 in 2014, with consumption up from 272 million m3 to 313 million m3 – a significant rebound,” he said. China was key to this turnaround. Europe was 2014’s top softwood producer with output at 101 million m3, followed by the US and Russia, on 95.7 million m3 and 36 million m3. But China had grown fastest, from 15.2 million m3 in 2010 to 28.8 million m3 in 2014, while consumption almost doubled to 47.3 million m3. It doubled its plantation area too, but rising demand was met mainly by imports; logs primarily from New Zealand, Russia and the US, lumber from Russia, Canada and Europe. China slowed down this year, but forecasts are for timber sector growth to revive, boosted by domestic logging curbs and timber building incentives.
Above left and top: Treet under construction, with CLT lift shaft beig craned into place Above: Framework, Portland. One of the winners of the government sponsored US Tall Wood Building competition, which attracted entries nationwide
Over-production concerns
EOS president Sampsa Auvinen agreed the EU was out of recession, but it remained a ‘roller coaster of market ups and downs’. “The concern is production out-running consumption,” he said. “We’re seeing good recovery in some countries, but overall growth is slow, with EU construction expected to rise just 1-2% this year. There’s talk of a decrease in EOS country softwood output to 79.6 million m3 this year in line with demand, but so far it’s not apparent.” Long-term prospects were good, Mr Auvinen added, with China regaining momentum and new markets emerging, including Poland and Iran. But Europe’s
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Post recovery... continued
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Workshop discussions
short-term prospects looked weak and, he said, if mills wanted to seek relief in volatile emerging markets “their production must react to demand fluctuations quicker”. ETTF President Andreas von Möller agreed that European recovery was uneven and key end user output remained below prerecession levels. The solution was to “treat markets individually and be sensitive to over-production”.
North America battles headwinds
US and Canadian softwood sectors also faced ‘headwinds’ according to Marc Brinkmeyer, Chief Executive of Idaho Forest Group. “Despite low interest rates, US mortgage debt is flat,which slows construction,” he said. The expiry of the US/Canadian Softwood Lumber Agreement also created uncertainty, although it was hoped this would soon be renewed or replaced. But underlying trends were positive, with US annual housing starts back above 1 million, lumber demand forecast to hit 53 billion board feet in 2017, against 42 billion last year, and mill output 37 billion board feet against 31 billion. Other positives were commitment to panNorth American timber promotion via the Softwood Lumber Board, which has spent $100 million in its first decade, and growing interest in mass- or engineered wood building. The latter was seen in the response to the US government’s recent $3 million Tall Timber Building contest. In presentations on Morocco, Algeria, Libya and Tunisia (MALT) and the wider Middle East and North African region (MENA), Guillaume Hotelin, of Comarbois in Morocco and Jan Gustaf Roempke of ARA Timber acknowledged problems. Besides political unrest and conflict, these included depressed oil prices, lack of bank credit, and logistical issues, including ships taking weeks to discharge at Alexandria due to backlogs.
MENA momentum
But MENA markets were also billed as having potential. They currently import 10 million m3 of softwood, most of it European and Russian, although with US sales rising 26% last year to $27.4 million. Average economic growth rates are over 3% and combined population over 400 million and rising. Mr Roempke said key conflicts were also abating and that Egypt had been recently been rerated positive by Standard & Poor’s. Meanwhile, said Sviatoslav Bychkov, of Ilim Timber, the Russian softwood sector has been battling log export restrictions, the rouble’s volatility and trade sanctions. But it has also come through and now has strong growth possibilities, with the 202 million m3 annual timber cut 500 million m3 below potential. He predicted a sawn wood exports rise of 5.4% this year to 22 million m3, and he was optimistic long term, with demand in China, which consumes 39% of Russian sawn and 92% of log exports, expected to revive. “Russia’s new industry monitoring e-system should also boost efficiency and curb illegal trade,” he said. Naohiro “Bob” Iwami of Interfor Japan
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AEIM General Secretary Alberto Romero and American Softwoods'Charles Trevor in conversaton at the Conference
described his country as a “relatively small market”, but with a growing appetite for lumber; consuming 28 million m3 a year. Its construction sector is willing to pay a premium for consistent quality and is now using more kd and engineered wood, hence Europe’s rising softwood import share from 7% to 39% in 20 years. Moreover Russian housing starts were expected to rise by 40,000 this year to 931,000. The government aims to raise Japan’s timber self-sufficiency to 50%, added Mr Iwami; ‘but overall timber incentives should create import opportunities too' (see p12)”.
Cross-industry cooperation
An ISC ‘guest industry’ presenter Marco Mensink, Director General of the Confederation of European Paper Industries, described how softwood’s pulp and paper sister sector had also adapted to structural upheaval, notably contraction in newsprint and graphic paper markets. It had responded by upping packaging and tissue production and is now investing €5 billion in these areas. The outstanding challenge, where paper sees opportunity to join lobbying forces with timber, is to safeguard raw material supplies by curbing wood ‘waste’ going to landfill and incineration for heat and power. “We need a ‘circular’ economy, with landfill disposal banned and an end to distorting subsidy for burning wood,” he said. Marc Michielsen, Executive Director of Europe pallet industry federation FEFPEB, also saw scope for pan-forest products collaboration. “We need a common language to promote wood as the sustainable raw material,” he said. Otto Bosch, European Wood Network consultant, highlighted that the European timber sector already has a pan-industry marketing tool in the ETTF and EOS-backed Wood Toolbox, an online trade marketing, messaging and technical resource “Now we’re also planning a consumerfacing aspect,” said Mr Bosch. “It’s potentially a very exciting development for the market.” Meanwhile, the possibilities of latest wood construction case studies for generating market excitement were underlined in a presentation on the Treet Building by Ole Herbrand Kleppe, Chief Project Manager of Bob Real Estate Development. This new
14-storey, 49m apartment block in Bergen Norway is now officially the world’s tallest timber building (see p6). Treet comprises four-storey stacks of pre-fabricated modules in a glulam, a quick build system which, Mr Kleppe said, could pose “significant commercial competition for multi-storey steel and concrete”, with the added benefit of storing CO2 in its fabric – 2,000 tonnes in Treet’s case.
ISC 2015 Presentations are available for download at www.isc2015.nl ISC 2016 takes place in Paris on October 13-14
Post ISC update Softwood market developments since November have borne out ISC forecasts, said ETTF and EOS Presidents Andreas von Möller and Sampsa Auvinen in January updates, but with new developments. “In recent months some sawmill curtailment and good Chinese markets have underpinned markets,” said Mr von Möller. “While there’s more in the pipeline, it looks like there’s little spruce in stock and several sawmills report sold out for quarter one, helping firm markets and prices. Spring usually heralds a busy period, and this should happen in 2016. Generally northern Europe is doing quite well and some southern markets are recuperating step-by-step,. “ “Global and European economic outlook has not deteriorated, but not improved either,” agreed Mr Auvinen. “And 2016 growth will disappoint due to low productivity, ageing populations and recession legacy, while commodity prices continue to fall, putting pressure on exporters reliant on China. “Producers have announced further cutbacks, but price impact is unsure and housing is still only improving slowly. “North African countries' import limits to balance trade deficits could also continue pressure on sawn pine imports and prices, although the spruce situation is healthier.”
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