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Soft Light Wood Business Prospects

Soft Light Wood Business Prospects
Soft Light Wood Business Prospects – Soft Light Wood Business ProspectsIn Japan and Europe, light wood has become the prima donna to be processed using technology and innovation into various products.

A memorandum of understanding (MoU) for the development of sustainable light wood was signed by the Ministry of Trade through the Directorate General of National Export Development (Ditjen PEN) and Fairventures Worldwide. The MoU is a form of the Ministry of Trade’s commitment to support innovation and creativity in the development of light wood, especially the types of sengon and jabon. This MoU is also a step taken to capture the prospect of the light wood business becoming the world’s prima donna in the future.

The MoU was signed by the Director General of National Export Development, Didi Sumedi and CEO of Fairventures Worldwide Megan King, on Friday (22/4/2022). In addition to the MoU, the Ministry of Trade and Fairventures Worldwide also signed a Technical Arrangement (TA) to follow up on the MoU in detail.

Please note, Fairventures Worldwide (FVW) is a registered non-governmental organization. It has representatives in Indonesia and Uganda. In Indonesia FVW has a representative office in Palangkaraya, Central Kalimantan. They work in the environmental sector and have been managing the 100 Million Tree Planting Program in Central Kalimantan since 2014.

There, FVW representatives manage reforestation activities for more than 1,000 small farmers in Kalimantan. Using digital technology, they help farmers measure the value of their forests and design better forest management. FVW works throughout the timber supply chain to connect farmers and buyers with the aim of providing sustainable income for forest farmers.

So far, Fairventures Worldwide has focused on forest restoration activities through four approaches. Namely, increasing the capacity of smallholders, forming farmer communities that play a role in forest conservation, distributing free tropical wood tree seedlings to farmers, and building responsible supply chains.

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In 2021, Indonesia’s wood product exports will be recorded at USD13.56 billion. This value is up 18.52 percent compared to 2020. The main export destinations of Indonesian wood products are China, the United States, Japan, the Netherlands, South Korea, India, Malaysia, Australia and Vietnam.

Exports of wood products and timber legality verification system (SVLK) products in 2021 will be recorded at USD13.56 billion and Indonesia is in the 12th position as a global supplier of wood products. Of the total exports, the contribution of plywood (HS 4412) was USD 2.5 billion and parquet and flooring wood products (HS 4409) amounted to USD 714 billion.

In 2021, the total world trade in tropical timber will reach USD196.4 billion. Meanwhile, tropical forest timber production only reached 2.6 billion cubic meters (m3). So that this untapped potential market can be utilized by Indonesian wood exporters and producers.

Director General of National Export Development Didi Sumedi in his official statement said that light wood has become the prima donna to be processed using technology and innovation into various products that are very prime and of high value in the world, especially Japan and countries in the European region. However, there are still not many consumers who know the uses of light wood.

Meanwhile, Indonesia is one of the largest timber barns in the world that has the potential to dominate the market by supplying light wood in a sustainable manner. It is also adapted to the tastes of consumers who want lightweight materials, flexible in application, environmentally friendly, and sustainable.

Light wood has the advantage that it can be harvested on average within 4-7 years. This type of wood has a high economic value because of the fast planting time, making reforestation easier and attracting interest in the world market.

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Didi explained that through the signing of this MoU and TA, various activities will be carried out involving various stakeholders in Indonesia and abroad. These activities, among others, educate consumers about the benefits of light wood, not only as a superior product but also to support farmers’ welfare, be environmentally friendly, and a reliable source of export.

In addition, Didi also said that a lightwood innovation center would be established and conduct training on the use of light wood through various innovations. The Ministry of Trade and Fairventures Worldwide also agreed to promote SVLK in Europe.

There are 2000 sengon wood farmers to be fostered, covering an area of ​​2000 ha of sengon plantations and spreading two million sengon seedlings. In realizing the MOU, the Ministry of Trade and Fairventures Worldwide collaborated with seven ministries and local governments.

As a tangible manifestation of this collaboration, Fairventures Worldwide will launch a pilot project in the form of a 70m2 light wood house which will be placed in the Central Kalimantan Provincial Forestry Service Office. This modular will be built efficiently using a modular timber construction system which requires only a maximum construction time of three days.

It is this system that Fairventures Worldwide wants to introduce to farmers, producers and related stakeholders. The aim is to increase awareness that light wood has very high added value by diversifying various export products.

Director of Export Development Cooperation, Ni Made Ayu Marthini, in an official broadcast by the Ministry of Industry and Trade said that Indonesia has a good reputation in terms of wood exports, which has been carried out for a long time, especially with the existence of SVLK which ensures that Indonesian wood products meet the aspects of sustainability, legality and traceability.

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Sengon and jabon wood are examples of light wood that have fulfilled these aspects and are able to act as carbon capture . This is in line with Indonesia’s National Determined Contribution to reduce carbon emissions by 26 percent to 41 percent by 2030.

Through this collaboration, Fairventures Worldwide is expected to become one of the mouthpieces to promote the use of sustainable wood and to become an agent of promotion of SVLK-certified Indonesian wood products, especially in the European market. “The issue of SVLK acceptance, especially in the European region, is very important in encouraging the export of wood products.

The goal is to avoid discrimination with wood products from other countries, especially when compared to other commercial certifications, such as the Forest Stewardship Council (FSC) and the Program for the Endorsement of Forest Certification (PEFC),” said Made Ayu.

According to Made Ayu, considering the excellent prospects for light wood so far, the Ministry of Trade is collaborating with the Swiss Import Promotion Office (SIPPO) and the Import Promotion Desk (IPD) of the Netherlands for the development of light wood products and market intelligence in the Netherlands and Switzerland.