The role of productive forests and trade of forest products in sustainable development

Gerhard Dieterle, Executive Director, ITTO

Tropical forest degradation: geography of carbon density change

A. Baccini et al. Science

2017;science.aam5962

• Tropical forests are a net release of

carbon of 425.2 ± 92.0 Tg C yr–1

(losses of 861.7 ± 80.2 Tg C yr–1 and

gains of 436.5 ± 31.0 Tg C yr–1 from

forest growth)

• Losses result from (i) deforestation

and (ii) reductions in carbon density

within standing forests (degradation)

accounting for 68.9% of overall

losses

Large impact of forest management and grazing on global vegetation biomass • Land management effects (forest

management and grazing) contribute 42-47 % to the reduction of C stocks

• On-site preservation of carbon stocks on managed forests and raising the contribution of biomass to raw material and energy supply for CC mitigation

Increasing global wood demand

Increasing Gap for Industrial Roundwood

0

2000

4000

6000

8000

10000

12000

14000

1900

Sawn Logs&Sheet1!$9:$9 VeneerLogs

Energy Wood

Household EnergyWood

Total Wood Demand

2010 2050 2030

WWF 2012

Mill m3

IFC 2013

Increasing global demand for wood

IFC/Dieterle et al. 2015

4

Increasing global wood demand

0 50 100 150 200 250 300 350 400

Africa

South Asia

Middle East and North Africa

Latin America and Caribbean

Europe and Central Asia

East Asia and Pacific

Australia, Japan, New Zealand

European Union (27) + 3

North America

Primary energy supply in MTOE

Traditional uses (wood) Traditional uses (agricultural residues)

Production of heat and power Internal use in forestry and agricultural processing

2005

2030Demand in woodfuel and charcoal continues to increase • 2.8 billion people will depend on

traditional fuels in 2030 • Massive increase in demand for energy

wood in industrialized countries

IFC/Dieterle et al. 2015

5

Projected HWP supply gap in 2040 under current conditions

- Supply gap in six case countries -

World Bank, 2015

Employment benefits of the Green Growth Scenario

Mitigation potential of the Green Growth Scenario

- Six Case Countries -

Potential of forest for achieving NDCs –important for transition countries–

Peak)

2015 (INDC)

0

20000

40000

60000

80000

100000

120000

140000

160000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

CO

2 E

mis

sio

ns

Time

Simulation: roughly sequestration and substitution effects in tropical forests

Multiple-benefits of common forestry practices

CL

Conservation

Plantations

SFM

Agroforestry C stock

Csequestration

Csubstitution

Biodiversity

Socialservices

Environmental services

Profitiablity

Multiple wins from sustainable forest supply chains

• Economic growth

• Poverty reduction

• “Wood security”

• Additional climate mitigation benefits: Emission reduction + CO2 removals+ substitution + storage:

Potential is up to 8GtCO2/year

• Increased environmental/biodiversity benefits

• Global water regime

Overview of the forest supply chain

Source: WWF & IIASA 2012.

Actively promote sustainable production & consumption of wood products, NTFPs & NTFS in international and domestic markets

Intervention Area ITTO Service Offer

Policies Creating awareness across international forest regime; policy processes, broad public about the role of productive role forests and forest products in a green economy: Poverty alleviation, economic/rural development, climate, biodiversity, social

Incentives Urgent need for fiscal and taxation incentives as stimulants for massive investments in tropical forest landscape restoration Joint WB – ITTO initiative

Rules of the game Promote/facilitate conversion towards universal criteria for legal and sustainable supply chains; Reduce complexity for producers and consumers: economic, environmental, social

Information and capacity building

Support and assist with information, data and skills throughout supply chains: producers and consumer government, traders, processors, markets

Tracking and verification Piloting innovative tracking and verification technology

Assist private sector initiatives

Encouraging/promoting/piloting private sector initiatives for green supply chains (from legality to sustainability)

Policies: Why Green Supply Chain Initiatives are important Consumer countries Tropical timber producing countries

• Foreign investment by progressive wood industry will focus on low-risk countries to ensure legality and sustainability.

• Consumer countries will become increasingly self-sufficient: increasing North-South trade

• Market share of chemically & mechanically modified softwood (e.g. Kebony, acetylated wood, compressed softwood) eroding the demand and market share for tropical hardwood will decrease.

• Public and political acceptance of tropical timber will further erode if GSC is not done.

• Demand for verification of legality and sustainability will become the “norm” in an increasing number of countries.

• REDD+ approach needs to be complemented: access to investment finance, fiscal/tax/other incentives, capacity building, public-private partnerships etc.

• Tropical timber producing countries will face increased demand for verified legal and sustainable timber.

• Risk of losing global market access for tropical timber is imminent; Increased trade deficit.

• Without addressing emerging domestic supply gaps of timber and wood-based energy many tropical countries will

– Depend increasingly on non-renewable materials (steel, concrete, fuels)

– Risk of increased deforestation/degradation

– Depend increasingly on imports from the North.

• Reduced risks and increased attractiveness for foreign investment in

• Urgent investments, incentives and capacity building in SFM and green supply chains needed.

Green supply chains and the role of ITTO

Global Green Supply Chain Initiative (GGSC) Beijing, June 2018

• GGSC members: Currently 12 progressive Chinese wood importing and processing enterprises.

• GGSC secretariat: CINFT / NFGA (National Forest and Grassland Administration, previously SFA).

• GGSC promotion committee: GGSC secretariat, ITTO, China timber and wood products distribution association, Green carbon foundation, (open for enterprises to join).

• GGSC expert group: ITTO TAG, CINFT.

• External stakeholders / supporters: MOFCOM, GIZ Forest Policy Facility, TNC, etc.

Working with partners: SW4SW Initiative: FAO, ITTO, WB, WWF http://www.fao.org/forest

ry/sustainable-wood/en/

Mexico: a major producer and consumer of coniferous timber in LAC… • The fourth producer of coniferous roundwood in LAC 5.2 million m3 (6% of the region total)

• The third producer of coniferous sawnwood in LAC 2.2 million m3 (11% of the region total)

• The first producer of coniferous veneer in LAC 300 000 m3 (35% of the region total).

• The third producer of coniferous plywood in LAC 185 000 m3 (5% of the region total)

These products are domestically consumed and Mexico was in 2016:

• The biggest importer of coniferous sawnwood in LAC 1.5 million m3 (53% of the region total)

• The biggest importer of coniferous plywood in LAC 382 000 m3 (54% of the region total)

…but a minor producer of tropical timber...

• The 11th producer of tropical logs in LAC 612 000 m3 (1% of the region total)

• The 11th producer of tropical sawnwood in LAC 149 000 m3 (2% of the region total)

• The 10th producer of tropical veneer in LAC 3000 m3 (1% of the region total).

• The 13th producer of coniferous plywood in LAC 3000 m3 (1% of the region total)

These products are domestically consumed as well. Nevertheless, Mexico was in 2016:

• The biggest importer of tropical plywood in LAC 140 000 m3 (60% of the region total)

... and a major exporter of wooden furniture

• The first exporter of wooden furniture in LAC $850 million (60% of the region total)

• The third biggest exporter of other SPWP (builder’s woodwork, mouldings, cane and bamboo ...)

$340 million (15% of the region total)

In 2016, Mexico was also:

• The biggest importer of wooden furniture in LAC $300 million (20% of the region total)

• The biggest importer of other SPWP (builder’s woodwork, mouldings, cane and bamboo ...)

$400 million (34% of the region total)

Mexico: major trends

• Mexico is a major producer and consumer of coniferous raw materials

• Despite being the first importer of tropical

plywood in the region, its weight in tropical products remain somehow small in LAC.

• Mexico is the biggest exporter of wooden

furniture in LAC but greatly depends on the US market (76% of its wooden furniture exports go to the US).

Mexico: potential of productive forest

• Mexico has committed to restore 8.5 million hectares of degraded land under the Bonn Challenge:

• If 1/3 of this commitment is dedicated to productive forest, Mexico could meet its demand for HWP while making a contribution to the NDC.

• The challenge is to develop/upgrade the wood processing industry, which heavily relies on imports.

• It is projected that Mexico will demand 70 million m3 by 2040 in HWP (sawnwood, wood-based panels, paper and paperboard): • Projected supply gap of 45 million m3 • The gap could be addressed by 2.6 million hectares of plantations (1.8

million hectares of short rotation –pulp and paper) • Availability of land remains a challenge

Mexico: potential of productive forest

Mexico: potential of productive forest

Mexico: potential of productive forest

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