KUCHING: Timber enterprises sampled by Global Timber Index (GTI)-Malaysia have called for woodchips to be retained for local consumption.
Malaysia has been exporting woodchips to several overseas markets over the years.
In Sarawak, some 170,155 tonnes of woodchips valued at RM109.9 million (free on board value) were exported in the January-July 2024 period, according to export data from Sarawak Timber Industry Development Corporation (STIDC). However, there was zero export in August.
In the latest monthly GTI-Malaysia Index Report, timber enterprises complained the cost of raw materials (woodwaste) was high, and they had suggested more certified sustainable logs be provided to the local market.
“The supply of raw materials from the (timber) concessions was inconsistent due to the poor weather,” they said, citing this as one of the main challenges faced by GTI-Malaysia enterprises.
To mitigate the challenges, timber enterprises suggested to slow down production, and they hoped the government stimulate construction industries to create more usage of sawn timber, and increase spending on building and infrastructure expansion so as to increase consumption of building materials.
According to the report, China, as one of the largest trading partners for Malaysian timber sector, had recorded a significant increase in the imports of timber from Malaysia, reaching 79,500 cubic metres (cu m) in the January-July 2024 period, representing a 29 per cent hike compared to the same period in 2023. This boosted the import value to US$28.03 million from US$22.87 million during the same period or up by 23 per cent.
Recently, the report said the Bursa Carbon Exchange (BCX) in Malaysia held its first auction of carbon credits, which came from Kuamut rainforest conservation project in Sabah. And this auction established a benchmark price for voluntary carbon credits in Malaysia’s nature-based carbon project.
In August 2024, GTI-Malaysia Index registered 31.5 per cent, an increase of 5.8 percentage point from the previous month, was below the critical value (50%) for 22 consecutive months, indicating that the business prosperity of the superior timber enterprises represented by GTI-Malaysia index shrank from last month. However, the contraction eased.
As for the 11 sub-indexes, the inventory index of finished products and the purchase price index were above the critical value of 50% while the remaining nine indexes were all below the critical value.
Compared to July, the indexes for product orders, existing orders and inventory of finished products increased by 3.9-16.7 percentage point. The indexes for employees was unchanged from the previous month, and the indexes for harvesting, export orders, purchase quantity, purchase price, inventory of main raw materials and delivery time declined by 5.5-17.0 percentage points.
