Afforestation ensures sustainable timber exports

Limited supply of certified timber

Nguyen Quang Vinh from the Vietnam Timber and Forest Product Association points to growing demand on the world timber market for certified timber to manufacture furniture.

Vo Hoang An, deputy chairman of the Vietnam Rubber Association (VRA), says that although Vietnam has long been aware of global trends in sustainable forest management and forest certification in accordance with international practices, the amount of timber certified in accordance with the standards of the Forest Stewardship Council (FSC) remains limited.

The Vietnamese wood industry has grown rapidly in recent years, making Vietnam the world’s fourth-largest wood and wooden product exporter in 2015. However, certified or verified legal wood products, from either domestic or imported sources, are only a small component of the overall industry. Despite the Forest Sector Development Strategy’s target that 30 percent of the country’s forest area be under certification by 2020, to date only about 200,000ha – less than two percent - of plantation forest and no natural forests are certified.

Promoting linkage

Vu Que Anh, coordinator of the Forest Stewardship Council in Vietnam, says Vietnamese businesses have only paid attention to certified acacia plantations, while the certification of other timber remains limited. In addition, awareness of businesses and forest owners about certified timber is not high.

Truong Minh Trung, deputy general director of the Vietnam Rubber Group, admitted that the group has about 420,000ha of rubber plantations (300,000ha at home and 120,000ha abroad) without FSC certification.

According to Truong Minh Trung’s explanation, its partners do not have strict requirements in terms of certified timber, so the group has not focused on the issue. However, the group is aware of the importance of FSC certification and working with the Vietnam Rubber Association and looking for a consultancy unit so that by the end of this year or 2018 it will have certified forests. Trung says he understands this is a global trend and wood businesses must meet international standards to ensure long-term sustainable development.

The IKEA factor

In fact, several models of association between businesses and afforestation households have been developed to provide certified timber. The Nam Dinh Forest Products Joint Stock Company (NAFOCO) is one of the pioneers in promoting linkage with afforestation households to meet orders of the IKEA Group. The company piloted an afforestation model to provide certified timber in Yen Bai Province’s Yen Binh District, covering an area of 1,000-3,000ha with the participation of 494 households in April 2016. In addition, the company pledged to buy FSC-certified timber at prices at least 10 percent higher than the average selling price on the market at the time of transaction.

NAFOCO is also cooperating with afforestation households in Hoa Binh, Thanh Hoa and Quang Ninh provinces to expand afforestation models for certified timber. In particular, NAFOCO has spent nearly US$1 million to help afforestation households in Hoa Binh Province meet FSC requirements.

The Scansia Pacific Co., Ltd. signed an agreement with 564 afforestation households in seven districts of Quang Tri Province to underwrite raw materials. The company also financed costs for a group of households to register FSC certification, and pledged backing for acacia plantation households from the sixth year onwards to borrow up to VND4 million per ha per year at an interest rate of 0.2 percent. This lower than average interest rate is designed to help growers extend the planting cycle and create a large source of timber. The company also pledged to buy FSC-certified acacia wood for at least 15-18 percent more than market prices at the time of transaction.

Nguyen Ton Quyen, the deputy chairman and general secretary of the Vietnam Timber and Forest Products Association, said that the linkage between businesses and afforestation households is important because it will resolve three basic problems. These are meeting the supply of wood materials, ensuring the origin and traceability of wood, and harmonizing interests between the parties. In addition, to ensure sustainable development, land disputes should be resolved and open mechanisms and policies should be promulgated, he added.