Land owners planting carbon forests have been assured that the emission trading scheme (ETS) will survive when the Kyoto Protocol ends in 2012. Environment Minister Nick Smith, Agriculture Minister David Carter and Prime Minister John Key speaking at forest industry conferences last week emphasised the importance of new forest plantings to New Zealand’s future. They also went out of their way to reassure would-be tree planters about the future of the ETS.
“Forestry is a long-term investment and land owners need certainty about the ETS rules. The government has got that message,” said Dr Smith, who was the most explicit with his assurances. “The preference of the government is that there is a post-Kyoto agreement. But if it doesn’t happen you can have a high level of confidence that an ETS framework will remain in place, as will the treatment of forestry within it.”
He said he couldn’t speak for future governments, but emphasised the fact that all the major political parties support an ETS. “Any political debate will not be about the role of forestry in an ETS. It is going to be around how fast you bring in other sectors and how fast you phase out protection for emitters.” Dr Smith said it was hugely difficult to get a read on the long-term prospects for an international agreement to replace Kyoto. This may become clearer at the next round of United Nations climate change talks which are being convened in Cancun, Mexico, later this year.
As a sign of improved markets for forest products in early 2010, global trade of logs increased by almost 20 percent during the first quarter as compared to the same quarter in 2009. An estimated 67 million m3 of softwood logs were traded in the world in 2009, which can be compared to over 95 million m3 in the record year of 2007. The biggest rise in softwood log imports occurred in Western Europe and Asia where imports to China, South Korea, Germany and Belgium have gained the most this year.
After two years of declining trade, 2010 may very well be the turning point when global log trade will start growing again. However, the growth is not of the magnitude such that global shipments will reach the pre-financial crises levels of 2006 and 2007. Russia is still the major supplier of softwood logs to the world, but its share of total trade has fallen from almost 40 percent in 2006 to less than 28 percent in the first quarter of 2010. This decline can be contributed to the 25 percent log export tax, which the Russian government implemented in 2008.
Log exporters in New Zealand, the second largest log exporting country in the world, have benefited from the high costs of Russian logs; New Zealand exports increased by 43 percent during the first four months of 2010 as compared to the same period in 2009. New Zealand Radiata pine logs currently account for approximately 13 percent of globally traded logs. Other major log-exporting countries in 2010 include the US, the Czech Republic, France and Canada.
China is by far the worlds biggest importer of softwood logs, accounting for about a third of globally traded logs in 2010. During the first six months of this year, imports were up 17 percent from the same period in 2009, reaching the highest level on record, reports the Wood Resource Quarterly. Russia and New Zealand are the largest suppliers, together accounting for almost 86 percent of the total imports. The increase in log imports to China is the result of the higher production levels in the forest industry and the lack of domestic timber resources. Despite the Chinese government’s efforts to become more independent on foreign logs by investing in the establishments of large areas of plantations over the past ten years, there are not enough mature forests to meet the ever-increasing need for wood raw-material in the country.
(Source: Wood Resources International)