Thursday, 4 December 2008

Govt team to work on U.S. rules for wood certification

Thursday, December 4, 2008

Govt team to work on U.S. rules for wood certification

Mustaqim Adamrah , The Jakarta Post , Jakarta Thu, 12/04/2008

The government has set up a team to address issues in relation to certification requirements imposed by the United States on wood-based products originating from Indonesia.

Trade Ministry's trade defense director Martua Sihombing said Wednesday that the team consisted of officials from the Forestry Ministry, Trade Ministry, Industry Ministry, Foreign Affairs Ministry, Agriculture Ministry and Finance Ministry, as well as representatives of wood-based business associations.

"In response to the United States' new regulation issued in May this year, the team will be working for two months, starting today (Wednesday), to determine Indonesia's position," he said.

During the two-month period, the team will identify all the new procedures and possible constraints under the new regulations to help local industries and perhaps even seek clarification from the U.S. government.

"On Feb. 3, 2009, we will have a clearer idea as to what we're going to do about the U.S. (regulations)," Martua added.

He said the regulations, which would be fully implemented in July next year, required global traders selling wood-based products in the U.S. to have a certificate issued by the U.S. government via internationally recognized agencies.

The certification regulation is meant to provide assurance that the products are derived from sustainable forests and not from illegal logging, which has been very common in the country.

According to the Central Statistics Agency (BPS), exports of wood and wooden products amounted to US$2.48 billion in the first 10 month of this year, a 3.9 percent drop from $2.58 booked in the same period last year.
In response to the certification requirements, Indonesian Pulp and Paper Association (APKI) chairman Mohammad Mansyur said the pulp and paper industry was ready to comply with the regulation.

"We're ready because there are now many global buyers choosing to have wood-based products with certificates," he said.

He said the requirement would not undermine Indonesia's pulp and paper exports to the U.S., which amounts to less than 10 percent of total exports to that destination.

The BPS data show paper exports stood at $3.23 billion in the January-October period this year, 19.4 percent higher than last year's record of $2.7 billion.

In addition to Mansyur's views, Indonesian Furniture and Handicraft Association (Asmindo) chairman Ambar Tjahjono said such certification was necessary to compete in the global market.

Certification refers to Sustainable Forest Management (SFM), Verification of Legal Origin (VLO) and Chain of Custody (CoC). The VLO and CoC prove the legality of the wood, while the SFM certifies the wood was legally felled and came from a sustainable forest.

An exporter can choose to use any of the three certificates.
A project manager at VLO certification issuing firm Technischer Uberwachungs-Verein Rheinland, Cecep Saepulloh, said recently that an SFM or CoC certificate would be valid for five years, and the VLO for three years.

On average, the United States imports around 30 percent of Indonesia's total furniture output annually, according to the National Agency for Export Development (Nafed).

The agency said with a market share of 4.26 percent, Indonesia is ranked fourth after Germany, with 5.19 percent, as a top supplier of wooden furniture to the U.S.