The Forest Scribe

Despite Being a Step Ahead, Indonesia’s Wood Product Exports to EU Still Lag Behind

Illustration of Wood cutting in Indonesia for exports

Indonesia is the first country to export legally harvested timber and wood products to the European Union (EU) but its export of furniture and other wood products to the region remain still far from its full potentials, experts said (11/2).

Tri Nugroho, from the Multi-Stakeholder Forestry Program (MFP) Phase 4 said that Indonesia is one of the 15 tropical timber exporting countries to partner with the EU under the Forest Law Enforcement, Governance and Trade (FLEGT) action plan and issued the first FLEGT licenses for timber product exports to EU Member countries in 2016.

“This should have given an advantage for Indonesia in getting a better share of the market. The market in Europe demands that the timber is legal, however, there is also the factor of design, pricing and quality,” Nugroho said, commenting on why Indonesia’s export of timber and wood products to the EU was still way behind its potentials.

Europe only account for nine percent of Indonesia’s wood product exports, he said. China, for example absorbed 28 percent, Japan 12 percent and the United States 11 percent.

Iwan Wibisono, a program manager with the MFP 4 also said that what was needed was to build a better ecosystem for the country’s furniture industry that could assure better design, pricing and quality control for its export products.

“We are also behind in terms of innovation,” Wibisono added.

Nugroho also added about the need to come out with a better ecosystem for the country’s furniture industry. “It should be better packaged. Having a certificate is good, but if the product is bad and badly packaged, it would be difficult,” Nugroho said, referring to the export products.

Nugroho also said that the MFP4 was currently taking a different approach in developing the wood product industry,

“We are not starting from the supply side, but from the market side. This is a new approach,” he said, adding that under this approach, it was expected that what was produced met what was actually needed or demanded by the market.

Wibisono pointed out that there was a need for the furniture industry and the government to look to the domestic market rather than only focusing on the export market.

“Maybe it is time to become more serious in according attention to the domestic furniture industry. Why don’t we strengthen design for the domestic market,” he said.

“The potentials of the domestic market is just as interesting to develop, maybe just as seriously as we are developing the export market,” he added.

More from Bhimanto Suwastoyo.
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