Zhu Guangqian
Chairman of China Timber and Wood Products Distribution Association (CTWPDA)
Title
Introduction to China’s export of wood products and attitudes and measures taken incombating illegal logging
I. Introduction to China Timber and Wood Products Distribution Association andChina’s export of wood products to Japan
China Timber and Wood Products Distribution Association (CTWPDA) was established in1985. It is an authorized national association registered in Ministry of Civil Affairs of thePeople’s Republic of China, with 1050 members distributed in various provinces and cities
in China. It is composed of 7 specialized committees, specialized committees of timbermarket, flooring, wooden doors, anti-corrosion of timber, veneer, engineered wood andmarket credit evaluation, and center of timber-related professional skills appraisal,
periodical of information for timber distribution and website.
The objectives of CTWPDA are to serve for the enterprises and consumers, i.e., to provide
platforms for the exchanges and trade, such as exhibitions and fairs, to organize training, toset up standards, to provide information, to standardize market and evaluate credit forenterprises, to promote enterprises to join in activities of promising their service to letcustomers feeling at ease, to organize participation of exhibitions and exchanges aboard,
to explore overseas resources, to report suggestions and demands of enterprises togovernment.
Table 1 China’s export of wood products to Japan (Jan. to Oct, 2009)
Exports

Quantity

Amount（0000 m3）（0000 US$）

Sawnwood

25.23

in which, Korean pine and scots pine

9.16

Spruce1.50

Paulownia

6.60

VeneerShare in
ExportQuantity

16548

53.90%

0.71

1648.210.10%

Particle board

0.17

211.4

2.60%

Plywood

32.72

12546.25

7.20%Wood products for Construction

4.9313129.87

15.00%

in which, wooden doors

2.80

Wooden furniture (0000 piece)

1581.828

13.40%
45520.3

11.60%

1) China’s timber supply, consumption, and forest resources
Table 2 China’s timber supply (2008)
SupplyQuantity （0000 m3）

Share (%)

Domestic production of commercial timber

8108.322

Farmers' wood for private use andfuelwood

5281.6

14

Wood fiberboard and particle board

6817.3

18

Harvests beyond quota and timber in stock

1400.04

Import of roundwood

11558.4

31

Import of sawnwood

1009.03Import of pulp and other wood products

2957.08

Table 3 Timber consumption (2008)
Quantity

Consumption（0000 m3）

Share (%)

Consumption of timber for industrial andconstruction uses

8287.622.3

Paper-making

13014.8

35.0

Furniture

4477.8

12.1

Export5833.915.7

Coal mining

1042.2

2.8

Farmers' wood for private use and fuelwood

3670.7

9.9

Others817.7

2.2

Fig. 1 Domestic production of roundwood and sawnwood (0000 m3)
Domestic production of roundwood and sawnwood
12000.035%

10000.02841.0

Sawnwood
Roundwood

8000.06000.02829.12486.5

13.4%
634.4

1532.5
763.8

851.5

1790.31126.98408.04000.02000.05560.34724.0 4552.0 4436.1 4758.9 5197.3

6611.8 6976.7

0.0
2000

2001

2002

2003

2004

2005

2006

2007

29

2008

China’s forest is managed relatively strictly through certificate of harvesting and certificate
of transportation, and only a small quantity of timber is from illegal logging. In 2008,
production of commercial timber is 81.08 million m3, production of farmers' wood for private
use and fuelwood is 52.82 million m3, while another 14.00 million m3 are from harvests
beyond quota.
China has established its own forest certification standards and will implement it next year.
FSC and PEFC and other schemes are implemented in China, but the share is less 1%.
II. Situations and challenges for China’s wood products export enterprises
Compared with other industries in China, timber industry which is aiming at EU and USA
markets and constrained by resources is facing the following situations and pressure.
III. 1) Affected by financial crisis, enterprises have the problem of low competition
capacity revealed.
Financial crisis in last year heavily affected wood products export enterprises in China.
Many export enterprises stopped the production or only reached half of the production
volume as usual. There were much less transactions in wholesale market, and distribution
enterprises face serious pressure. Even though, in January to October, the export of wood
products increased if compared with the same period last year, the problems appeared
during the financial crisis have to be considered.
China now can be said a big country of production and export, but not a strong country. The
following problems have appeared during the financial crisis. Firstly, the size of enterprises
is small, and the level of management is low. Secondly, there is no much variability ofproducts, low added-value, low contents of science and technology, short of competition
capacity, and there is a necessity of upgrading industry. Thirdly, many enterprises do nothave their own brand, distribution channels and network for their own products ininternational market. Therefore, enterprises have to rely on others heavily. It is necessary tosolve these problems in order to increase the competition capacity in international markets.
2) Export enterprises have to meet stricter standards to enter international markets.
Combating illegal logging and related trade and establishing sustainable forest ecology
system have been attracting international attentions. Countries in Europe and America
issued some standards and codes and increased the entrance requirement into their wood
products markets.
3.2.1 The Lacey Act of USA was amended in 2008, and the difficulty and risk wereincreased.
According to the Lacey Act, it is unlawful to import, export, transport, sell, receive, acquire,or purchase any plant in violation of the laws of the United States, a State, or any foreign
law that protects plants.
The Lacey Act Amendment was supposed to be put into force since April 1st 2009, from30

primary products to more value added processed products, step by step, but later theimplementation was delayed. But still, we have to be prepared for the implementation.
3.2.2 EU and Japan, as main importers of wood products, constrain illegal wood products toenter market by taking a green procurement. Firstly, EU adopted an action plan for Forest
Law Enforcement, Governance and Trade (FLEGT) to combat illegal logging. Secondly, EUannounced to make legislations against illegal logging for its member countries in 2008.
Thirdly, countries like UK, France, Germany, Holland and Japan take forest certification ofFSC, PEFC or others as a requirement to enter market. Fourthly, industry associations like
Timber Trade Federation (TTF) in UK and French Timber Trade Federation (LCB) haveestablished codes of conduct foe their members, to ensure raw materials are from legal
sources. B&Q, Kingfisher China, Ikea and other companies set their own responsible
purchasing system to make sure that their wood products are from legal and sustainableforests.
These measures concerning trade, taken by a legislative form or voluntary actions byenterprises, require that the export from China must obtain the green permit to enterinternational market.
3) Many countries are stricter to export of timber from natural forests.
As more and more international efforts are made to fight illegal logging, either African
timber producer countries or coniferous timber exporting Russia, are limiting exports oftimber from natural forests, and the quantity will decline year by year. This will cause Chinato decrease its timber import, and enterprises by using imported raw materials will beconstrained.
Therefore, China’s wood products enterprises not only have to increase their competition
capacity, but also have to face a series of regulations by Europe and America on entering
their markets, and issues of how to escape from the risk of trade and obtain green permit tointernational markets.
IV. How China’s wood products enterprises grasp the opportunity to develop under
the challenges of global climate change
The existence and development of mankind are affected by climate change. How to deal
with climate change implies a global challenge, and also an opportunity for thedevelopment of forest industry. Forest industry includes primary industry, secondary
industry, and tertiary-industry; it has wide scope, long chain of industry, and is an importantpart of industry chain to develop economically, environmentally friendly, and sustainably.
Forest industry plays an important role in establishing resources-saving andenvironmentally friendly society and dealing with global climate change. To research thedevelopment of forest industry, it is necessary to link it with sustainable development.
Concerning this, Chairman Hu Jintao proposed 4 points in UN climate summit recently. To
fulfill ones own responsibility is the core; win-win result is the objective; mutual31

development is basic; capital and technology is key. Chairman Hu also proposed detailed
measures. This speech not only stated the standpoints of Chinese government, but also
pointed out the direction of development of timber industry and fighting illegal logging forour country.
Based on the present situations and measures taken by international society in dealing withclimate change, we think that we should tackle the following two issues.
1) Set up corporate social responsibility (CSR) and responsible purchasing system,in order to obtain basic qualification to enter international market for enterprises.
Enterprises should be encouraged to promise to the society that they not import, use andsell “illegal timber and wood products” when confirmation is possible.
Enterprises should make efforts in showing that their raw materials are from a legal sourceby trying every possibility under their own conditions. Enterprises can choose FSC, PEFC,
or China’s own forest certification scheme to certify the chain of custody (CoC). Those
enterprises without being able to get certification also need to establish internal traceability
system for legal timber source and responsible purchasing system. Import enterprises
should add contents of legal timber source in their contract by requiring suppliers’ promise
to make sure that the timber they provide comply with local regulations, and fill in proper
names of imported timber species, including English and Latin names, value, quantity,origin of production, etc. In this way, importers in China can provide related information toexport enterprises which use imported timber and make export enterprises meet theinformation requirement to enter international market.
2) Emphasis should be put on scrimber, engineered wood, laminated bamboo lumber
and others that have high technology contents and are friendly to environment, andstructure of industry be adjusted, in order to increase the capacity of competition for
Chinese wood products to enter international market.
To tackle climate change, it is necessary to take measures not only to impose restrictions,but it is more important to develop new environmentally friendly products, in order to meetthe needs of economic development and life of mankind. That is, not only “stop up”, butalso “dredge”. The first is to develop scrimber to substitute hardwood and wood of precious
tree species; the second is to promote structural engineered wood in construction tosubstitute some of the uses of steel and cement which consumes more energy in theprocess of their production, and this also helps to decrease pollution; the third is to develop
laminated bamboo lumber to substitute timber.
These measures have the following significance. Firstly, these measures help to accelerate
structural adjustment of wood products. Scrimber, engineered wood, and laminatedbamboo lumber are deeply processed, with more contents of technology, high added-value,
and wide scope of usages. Aiding to develop these products helps to adjust the structure offorest industry, upgrade wood products enterprises.
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Secondly, these measures are helpful to meet the market demand and decrease the traderisk. The above stated products are all from fast-growing plantation forests, or lumber ofsmall size. This will increase the utility of lumber of small size or inferior lumber, and getgood economic benefit. Besides, by using timber from fast-growing tree species, there isless risk for exporting products to other markets. The market needs can be met while theconsumption of hardwood and wood of precious tree species can be decreased.
Thirdly, these measures are good to decrease the consumption of energy in construction.
Constructions of cement structure and of steel structure consume energy as much as 2.2
and 1.5 times of that in construction of timber structure, respectively. During the production,
steel and cement also consume much more energy than timber does. If set theconsumption of energy for unit timber production as 1, then 5 for cement and 191 for steel.
Therefore, using timber instead of cement, steel and soil brick, can decrease energy
consumption in the process of production of building materials and also in construction,effectively decrease the emission of carbon dioxide.
Fourthly, these measures will help farmers to plant trees actively, and develop forest
industry. Now China has become a country with largest plantation forest area. Developing
scrimber and engineered wood open a new field for using timber from plantation forest. If
helps farmers to plant trees actively, agriculture increase efficiency, farmers increase theirincome, and finally, more fast-growing forest can be obtained, ecological environment
improved.
Therefore, emphasis should be placed on reasonable making use of timber, developing
scrimber, laminated bamboo lumber and other environmentally friendly products, promoting
construction of timber structure, accelerating sustainable uses of renewable resources, andmake this as one of the future development strategies.
V. CTWPDA’s attitude towards and measures taken on combating illegal logging
In recent years, attitude of Chinese government towards illegal logging is resolute. ChinaTimber and Wood Products Distribution Association (CTWPDA) and member enterprises
also take positive attitude and practical measures. What we are doing include the following.
(1)To fully make use of publications and website of CTWPDA to promote sustainable
forestry development and the importance of international legal timber trade, help
enterprises to set up consciousness of environment protection.
(2)To strengthen industry being self-restrained. Appeal to member enterprises not import,
use and sell “illegal timber and wood products” when confirmation is possible. Whenevaluating credit situations for enterprises, whether enterprises are certified by CoC or not,whether responsible purchasing system is established or not, and how much contributions
to environment protection, are considered.
(3)To organize enterprises to plant trees and to donate to China Green Foundation once ayear.
(4)To strengthen the cooperation with international environment protection organizations
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and associations. To introduce international forest certification schemes to enterprises andto promote the development of CoC certification by way of holding seminars, providing
training and consulting services. After Lacey Act was amended, we held meetings withrelated USA associations and invited officials from US Department of Justice to give
introductions and exchanged over mutual concerns with enterprises in China.
(5)To submit suggestions to Chinese government in decision-making on combating illegal
logging, and report voices of enterprises.
(6)To exchange information actively and cooperate with associations such as those fromUSA, Malaysia, Japan, and ITTO. In October 2009, CTWPDA signed cooperationagreement with TFT. By setting up cooperation relationships for mutual benefit, exchangesand sharing will be strengthened in the fields of consistent objectives. The signing of theagreement made CTWPDA a partner in the second stage of TTAP project (the Timber
Trade Action Plan), and set up a partner relationship with TFT.
(7)To develop and promote scrimber, laminated bamboo lumber and engineered wood tosubstitute hardwood and timber from precious tree species.
(9)To provide actively professional training on timber inspection to timber inspectors forenterprises and inspection agencies in harbors.
There is no border for climate change. No country can do by itself. A principle of holding
common views but recognizing differences is necessary when making decisions in dealing
with climate change and combating illegal logging and related trade. China is still adeveloping country. In the international division of labor, China is in the position ofprocessing. The size of timber industry is small, and it is especially true for distribution
enterprises, mainly self-employed business. There are not many large and strong
enterprises. There is little consciousness of social responsibility among enterprises. The
work emphasis of CTWPDA from now on are: 1) to enhance the consciousness of social
responsibility in enterprises; 2) to help enterprises to set up responsible purchasing system;3) to undertake researches on inspection measures of source legality of export wood
products in China; 4) to promote and spread forest certification, CoC certification, in China.
We hope we could get much support from government, enterprises, research institutes,
international organizations, and foreign timber industry associations. We would also like tocontinue to strengthen our cooperation with international organizations and agencies, andmake greater efforts together on the sustainable development of forest industry and trade
and the protection of mankind life environment.

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