Guyana continues to export logs in large quantities mainly to India and China, earning much less than it would have, had the logs been subjected to simple processing methods.
According to the Guyana Forestry Commission’s (GFC) Forest Sector Information Report for the first half of this year, logs’ export totalled 39,795 cubic metres with a value of US$6.2 million. Sawn wood which was exported in smaller quantities at 11,854 cubic metres, earned considerably more at US$9.49 million. The Latin America/Caribbean region and Europe continues to be the primary export regions for sawn wood from Guyana.
There have been calls over the years for more value-added processing to be done since it can earn more rather than just exporting logs. The figures in the GFC mid-year report were up to June and forestry expert Janette Bulkan, in a letter last week to Stabroek News, said that from January up to September 2012, log exports totalled 66,270 cubic metres compared with 80,652 cubic metres in the same nine months of 2011.
She said that for that period, 27,764 cubic metres (42%) went to China and 35,024 cubic metres (53%) to India, including a whopping 16,640 cubic metres to India in August 2012. These log exports represented 54 per cent of log production in the first six months of 2012 compared with 56 per cent in 2011, Bulkan said, adding that the data do not show that the forest sector is in the doldrums as stated by forestry sector officials in a recent interview with Stabroek Business. The GFC report said that production of logs in the first six months of 2012 totalled 73,145 cubic metres as against 90,355 cubic metres for the same period in 2011.
According to the GFC report, the log exports for the first six months of the year, declined by 20.81% in volume and 11.92% in export value as compared to the same period last year. The largest reduction in log export came from the decline in the export of Special Category logs by 36.7% when compared to the corresponding period of 2011. For the six months, 2,854 cubic metres less of Special Category logs were exported. Logs classified as special category include Greenheart, Purpleheart, Brown Silverballi, Red Cedar, Letterwood and Bulletwood.
The report said that sawn wood exports for the first half of 2012 totalled 11,856 cubic metres earning US$9.49 million compared to 14,586 cubic metres earning US$10.1 million for the previous year. In term of export volume, this was a decrease by 18.72%, and in terms of export value this was a decrease by 6.3%, over the corresponding 2011 level, the report said. Sawn wood refers to dressed lumber (wood sawn lengthways from logs, further processed by planing, etc, undressed lumber, sleepers and pallets.
The GFC pointed out that Special Category Sawn wood contributed the largest percentage share of export volume, accounting for 47%, but the largest percentage share of value earned came from the export of Class 1 lumber. “The higher percentage share in value earned for these products is indicative of the increased average price received for these products,” the report said.
The GFC said that for the first half of 2012, Guyana’s main markets for log exports were found in the Asia/Pacific and the Latin America/Caribbean regions with India and China being the primary destinations within the Asia/Pacific and Trinidad and Tobago for the Latin America/Caribbean region. “This spiralling demand in India and China is attributed to their progressive growth in the International trade of these two emerging economies,” the report said.
With growth rates expected to be stable in the India and China economies, “it is anticipated that there will be a consistent demand for Guyana’s logs for the remainder of 2012,” the report said. It also noted that log production was expected to increase in the period August to October.
Meantime, the three main destination markets for sawn wood continue to be Barbados in the Latin America/Caribbean region, Netherlands in Europe and the United States in North America. Sawn wood continues to enjoy a relatively high price in these markets, even though the sawn wood markets have experienced a decline in export volumes from 2010 to this year.
Meantime, while for the first half of 2012, production volumes for logs was relatively low when compared to that of 2011 of the same period, for most other products such as primary sawn wood (primary lumber), round wood and plywood, there were favourable increases in total production quantities. “The increase in the production of some products, for the first half of 2012 over that of 2011, can be attributed to a slightly higher production level at some concessions. Also the recorded increase can be attributed to timelier submission of forest inventory information by concessionaire which allowed for a number of large concessions, to get an earlier start to forest harvesting activities,” the report said.
Logs exported to China contributed the highest share of volume and value. Compared with previous year, the average price received for logs exported to China increased by 33% from US$150 per cubic metre to US$200 per cubic metre. India followed as the next major destination with 16,639 cubic metre (US$2.89 million) or 42% volume and 46% value, of all log exports.
As a group, the Asia/Pacific countries consumed 39,097m3 (US$6.1 million) of logs accounting for 98.2% of export volume (98.6% of export value). Compared with the same period last year, this is a reduction of 10,349m3 or 20.93% in volume, the report said. The Latin American and Caribbean region consumed the second highest log export for the period, albeit at a much lower level than the Asia/Pacific region. This region accounted for 1.6% of log export volume and 1.24% in value, the report said.
