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For timber suppliers in the Lower Mekong, the playing field is still unleveled

Blog | Katrina Harina Borromeo
Fri, 17 Dec, 2021 · 7 min read
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forests in LMR

Across the Lower Mekong region, a new trend for timber trade is emerging. Latest statistics from the International Tropical Timber Organization show that there is less demand for high-value species such as Rosewood, while the demand for rubber and furniture wood is growing. Correspondingly, timber plantations are also increasing.  
 

“Increasing timber plantation is a welcome development, as long as it does not happen at the cost of reducing forests cover, nor at the cost of losing the land tenure of local communities,” said Leif John Foesse, a senior adviser at the Norwegian International Climate and Forest Initiative.  “Ensuring sustainable timber trade whilst developing the engagement of local communities is crucial”, he added.

On 9 December 2021, more than 150 stakeholders from the Lower Mekong region met online to discuss regional trends on timber trade, including the challenges, opportunities and solutions for sourcing sustainable timber in the region, with a focus on smallholders and small and medium sized enterprises.

 

The quest for sustainable timber


While markets are slowly stepping up to green the supply and demand of timber products, there are still many challenges that lie ahead, particularly with the certification of wood products.

Forest certification can help promote the sustainable management of forests and ensure that forest-based products reaching the market have been sourced from sustainably managed forests. But certification could also bring difficulties to smallholders because of its cost and complex requirements.

In the case of SilviCarbon, a Swedish Lao plantation company, its 3000 hectares of plantation is almost 100% certified FSC. However, only 11% of their timber is sold as certified. The rest is sold without the logo, despite being certified.

“SilviCarbon still continues to invest in FSC, but unless the government firmly sets the standards high, we are competing on an ‘unlevelled playing field’ because other companies are not being responsible”, remarked Peter Fogde, a SilviCarbon executive.

The role of governments in setting policies and incentives that promote legality, and disincentivize unsustainable practices is thus critical. Noting the Glasgow leader’s declaration on forestry and land use, and the commitment from the highest level for curbing deforestation supply chains in the US-China Declaration, the timing is ripe, according to Mario Boccucci, Head of UN-REDD Secretariat.

“Efforts to make the Mekong forest sector more sustainable can be spearheaded by governments, but they also require innovative strategies from supply chain actors, investors, and importantly the awareness of enlightened end consumers”, he said.

Banks, for instance, have an important role to play. Their financial investments can have a significant impact on the practices of companies which could either promote or halt deforestation.

“There is still a deep gap between the smallholders or the multitude of SMEs, and lenders or the global buyers committed to sourcing only from the most assured responsible supply chains,” remarked Astrid Agostini, a coordinator at the Forestry Division of the Food and Agriculture Organization.  “Unfortunately, the easier and faster route to market is inevitably the unsustainable and illegal one,“ she warned.

Control wood: a great leveler?


Control wood or controlled sources was discussed as a potential solution as this lowers the bar for smallholders as a step-wise approach to certification.

Control wood means that the timber is not fully certified, but they are legal, and avoid material from controversial sources such as conversion of natural forests, or high value species. Control wood can also be mixed with certified wood and be sold as ‘certified control wood/sources’. 

“Smallholders may stand a lot to gain from control wood – it reduces costs and compliance time; improves market conditions and prepares smallholders to be included in the group certification, “ explained Nga Ha from the Programme for the Endorsement of Forest Certification Schemes.

In the coming months, the initiative "Sustainable Forest Trade in the Lower Mekong Region" will further explore control wood supply chains and continue the dialogues with the key players, including the financiers, and buyers of timbers, to better understand how they are transitioning their supply chains, and what can be done to bridge demand with the Lower Mekong supply, sustainably.

 

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