A study by think tank Chatham House found around 15% of all timber exports from 37 exporting countries were illegal, amounting to US$19bn a year, resulting in “tens of millions of dollars in lost revenues for governments and citizens every year”. Source: Supply Management
The research said public procurement could have “an important role to play in driving change in business practices and in markets” – citing the impact of such policies in the UK and the Netherlands but the design and implementation of policies “varied significantly between countries”, along with the provision of training and advice for procurement officials.
“In many countries, the resources for providing these are limited and, in fact, the public services which provided such advice in the Netherlands and the UK have since been cut,” said the report.
The research, based on data from 2000-18, said the bulk of illegal timber came from China, Brazil, Indonesia and Russia and it called for increased transparency and cooperation between sectors.
The study comes as new deforestation rules are adopted by the European Parliament. Research found an area larger than the EU was lost to deforestation between 1990-20, with EU consumption representing around 10% of losses.
Allison Hoare, research author at Chatham House, told Supply Management: “Governments all along the supply chain need to focus on the enforcement of regulations, so those related to the production, processing, and trade of timber, including export and import regulations.
“Within the procurement profession, they need to ensure that they are asking the right questions of business, to ensure that suppliers can provide evidence of the legality and/or sustainability of their products.
“And similarly, companies need to ensure that they have a good understanding of their supply chains – within the UK, Europe, the USA, and an increasing number of countries in Asia, companies are required to implement due diligence to avoid purchasing illegal timber, for which knowing their suppliers is essential.”
More than two-thirds of recent tropical deforestation is estimated to have taken place illegally. China is the largest global importer of illegal timber, both for the manufacture of products for re-export and increasingly, to supply its domestic market.
Policies to control the trade in legal timber, reforming the legal framework, and new systems for timber licensing have been undermined by poor enforcement and implementation, as well as corruption, the study found.
“Illegal timber trading will impact on supplies in the longer term, particularly of certain high-value tropical timbers, because illegal practices undermine efforts to implement sustainable forestry practices. Where illegal logging is resulting in the overharvesting of a particular species, or the degradation or loss of certain forests, then this will impact on the availability of particular woods,” Ms Hoare said.
“There are a number of knock-on effects, particularly for the source countries of the timber, as illegal practices undermine efforts to establish sustainable forestry, which can result in the loss of forests, and loss of livelihoods and government revenues. For international trade it risks impacting on the supplies of certain timbers, and in the nearer term, it also damages the reputation of the sector, with the risk that consumers will turn to other types of product.
“Forests are critical in the battle against climate breakdown; the world’s biggest source of terrestrial biodiversity; a source of timber and other products; and, crucially, a home and livelihood for millions of people – but they are being destroyed by the illegal timber trade. With escalating climate and biodiversity crises, now is the time for governments to double down on efforts to tackle illegal logging.”
The European Parliament has adopted new rules for companies to help limit global deforestation, which will now be negotiated with member states. The legislation would make it mandatory for companies to verify goods sold in the EU were not produced on deforested or degraded land, alongside human rights provisions.
The European Commission’s proposal covers cattle, cocoa, coffee, palm-oil, soya and wood, including products that contain, have been fed with or have been made using these commodities (such as leather, chocolate and furniture). Parliament wants to also include pork, sheep and goats, poultry, maize and rubber, as well as charcoal and printed paper products.
Recommendations for increased due diligence included using satellite monitoring tools, field audits, capacity building of suppliers and isotope testing to check where products come from. EU authorities would have access to relevant information, such as geographic coordinates.
