Uncertain log market in Malaysia

ITTO's Tropical Timber Market Report
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Sarawak log exporters are saying that market sentiment is uncertain as some log buyers are waiting to see if the Indonesian authorities decide to allow the export of plantation logs.

Sarawak logs were traded at the following FOB prices:

  • Meranti SQ US$ 275 – 295 per cu.m
  • Kapur SQ US$ 340 – 365 per cu.m
  • Keruing SQ US$ 280 – 300 per cu.m
  • Selangan Batu regular US$ 510 – 535 per cu.m

                                                                                                                                           Sabah TLAS being tested

In Sabah, the timber industry and State Authorities are working together on the Sabah Timber Legality Assurance Scheme (TLAS) as part of the VPA which Sabah hopes to sign with EU.

Sabah mills are now undergoing compliance audits as they test the Sabah TLAS criterion on “Issuance, renewal and upgrading of mill license and conditions for operation”, as well as “Worker safety and health”.

All wood processing mills are required to be licensed with the Sabah Forestry Department and must comply with mill license conditions including submission of monthly mill production returns and maintenance of log delivery records.

The industry is also testing its TLAS principle on “Trade and Customs”, especially on meeting export regulations.

Exporting companies must have a valid export license from the Forestry Department and must comply with state and national regulations pertaining to the export of wood products.

Fire management the answer to limiting annual smoke pollution

Many parts of Malaysia are covered by smoke haze, an unhealthy situation made worse by the current dry weather conditions. The Air Pollutant Index (API) reached “very unhealthy” levels in some populated areas in late June.

The Malaysian government's index for air pollution reached a measurement of 746 on the worst days in the southern district of Muar, far above the threshold of 300 for hazardous air quality. This pollution has heightened public awareness of environmental issues.

The smoke, the result of the annual burning by farmers and plantation owners in Indonesia, is drifting across the Straits of Malacca and seriously affecting southern Malaysia.

After the serious forest fires in Indonesia in 1996/7 ITTO implemented several projects on various aspects of forest fire management in Indonesia and Malaysia with good effect.

Farmers and plantation companies are now more aware of the dangers of fires spreading to the forest and apply fire management principles but clearly more needs to be done.

Indonesian authorities say they have fire fighters in the affected areas and are investigating whether legal action should be taken against those responsible.

Forestry ‘peace deal’ delivers payout to Sarawak plymill in Tasmania

In the midst of the political leadership tussle in Australia came news that the Australian government has agreed to pay compensation to a Sarawak timber company operating in Tasmania.

The Malaysian news agency Bernama reported that the Australian Government has agreed to pay Sarawak-owned timber company Ta Ann A$26 million in compensation for wood supply the company is giving up as part of the forestry ‘peace deal’.

Under the deal, Ta Ann would lose access to forest resources which would have yielded about 108,000 cubic metres or 40 per cent of its peeler log supply.

Ta Ann said this means its mills in the Huon and at Smithton in Tasmania will now have to run below capacity. The company said the compensation payout will ensure all the 90 plus employees keep their jobs. The announcement of the settlement has been welcomed by ‘peace’ deal signatories, including the Wilderness Society's Warwick Jordan.

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