Guyana’s logs exports continue to rise and up to August, were double the figure for the same period last year while exports of value-added products were marginal.
According to figures from the Forest Products Development & Marketing Council (FPDMC) of Guyana Inc, log exports for the year up to August were 86,250 cubic metres compared to 41,518 cubic metres for the same period last year. The main destination was China with 86.28% of total log exports going to the Asian country.
The remainder of the logs went to India and Hong Kong.
In terms of export earnings for the sector, logs made a contribution of 54.48% with earnings of US$14.5 million. In contrast, even though the volumes exported were significantly smaller –only 12,730 cubic metres were exported – dressed and undressed lumber brought in earnings of US$11.7 million amounting to 27.47% of total exporting earnings.
Plywood exports amounted to 2,385 cubic metres with earnings of US$1.2 million. This represents a drop in exports from the same period last year.
The report said value-added products made a marginal contribution of 0.11% of total export earnings. Overall, for the year up to August, total forest export earnings increased 36.39% compared to the same period last year.
Concern has been raised before that despite the higher returns that can be realised from the value-added processing of logs locally, government has not moved with alacrity to compel major logging firms such as China’s BaiShanLin and India’s Vaitarna Holdings Private Inc (VHPI) to do so and as the companies continue to export huge quantities of logs annually, Guyana has been foregoing millions of dollars.
Exporting logs rather than processing the timber locally has long been a concern, since numerous promises have been made by the government and foreign investors about value-added operations. The promise of value-added has been seen as sugar coating to enable the export of large quantities of logs, particularly to China and India, even though there is little job creation here or value enhancement.
Firms such as Vaitarna and BaiShanLin have been exporting logs on a large scale even though government officials and the companies themselves have committed to processing wood here. Some of these exports have been ongoing for years with the companies failing to set up promised wood processing facilities.
There have been questions raised too about the accuracy of figures disseminated by the authorities. In August, Stabroek News obtained Guyana Forest Commission (GFC) figures that contradicted statements by Minister of Finance Dr Ashni Singh regarding forestry exports. The minister was subsequently accused by political parties of disseminating falsehoods and he has remained silent on the charge.
Singh, in his mid-year report on the economy, had said that for the first six months of the year the forestry sector recorded growth of 38.1%, “supported by the introduction of new incentives to harvesters and sustained demand from the construction sector and furniture manufacturing subsector.” This was not explained.
As a consequence, the growth target for the sector was revised upwards significantly from the budgeted 3.3% to 15% growth for 2014.
The report said that timber export earnings rose to US$21.3 million, a 31.3% increase due to an increase in export volume, “reflecting an expansion in plywood exports.”
However, GFC data did not support Singh’s statement that the increase in exports was largely due to an expansion of plywood exports.
Information supplied to the Inter-national Tropical Timber Organisation (ITTO) and to the FPDMC by the GFC show that plywood exports for the first half of this year amounted to 1,931 cubic metres, an increase of just 4.3% from 1,851 cubic metres for the same period last year. These plywood exports were valued at US$973,925.
In contrast, log exports for the first half of this year amounted to 54,376 cubic metres compared to 30,356 cubic metres for the same period last year, an increase of 80%. These log exports were valued at US$8,726,893.
The figures do not bear out Singh’s statement that “an expansion in plywood exports” was responsible for the increase in timber export earnings.
The GFC has stood by its figures and said that the figures supplied to the ITTO are accurate.
There have been calls from the political parties and others for Singh to explain his statement but he has not done so.
