Australia’s CSIRO is providing technical expertise in support of what US science magazine, Discover, has described as one of ‘the six most important experiments in the world’ – the Planted Forests Project on the island of Borneo. “This Malaysian project is visionary,” says the leader of the CSIRO team, David Boden. “Around the world we’ve seen that conservation in developing countries will only succeed if there’s something in it for the local communities. The Sarawak State Government has allocated nearly half a million ha. One third of the land will be set aside for conservation of Sarawak’s rich biodiversity, one third for use by the traditional ethnic communities, and one third for the establishment of a sustainable and economically viable plantation forestry industry.”

According to the Assistant Director of Forests, Sarawak Forest Department, Joseph Jawa, the project is unique in the region. “For example, under the project’s conservation plan, plantations are dissected by game corridors of undisturbed forest to help ensure wildlife does not become isolated and in-bred,” he says. “Timber will be processed locally, bringing more jobs and, because the Project is under government control, illegal clearing and logging has been greatly reduced.” Warren Ellis, the General Manager of Grand Perfect – the consortium managing the project – says CSIRO is providing support in the form of its expertise in a wide range of areas from tree improvement, to forest health, silviculture and forest management. Boden says that key to CSIRO’s involvement is its expertise in developing tropical acacia forestry plantations. “The Sarawak government has chosen selected Acacia mangium from Papua New Guinea and Queensland, Australia, for the plantations. A hectare of acacia plantation can produce more wood than 10 ha of forest that had been logged and regrown naturally. That step up in production could be the difference that makes the whole project viable.” He says that during his travels through SE Asia he has witnessed the damage caused when rain forest is cleared for oil palm and other cash crops. “This project offers a new direction – well managed profitable and sustainable forestry that also delivers for conservation and for the local people.” With 90,000 ha of acacia already planted, the first trees will soon be ready for harvesting.

This year is an important one for Komatsu Forest. “Having spent time mustering our strength, we’re now ready to launch our new harvesters, forwarders, control systems, harvesting heads, and fellers on a broad front,” the company reports. “This is actually the most extensive update to our product range for very many years. I’m very proud that we’re able to present so many new products and improvements this year,” says Toshio Miyake, CEO of Komatsu Forest.

This year’s product launches, which will be reported in detail in International Forest Industries, are the result of intensive efforts for continual improvement focused on customer benefits. Komatsu Forest works with Japanese quality assurance methods, which entail the factory, dealers, and customers co-operating to ensure that Valmet products are continually refined and improved. This year Komatsu Forest will have a higher public profile with more intensive marketing, as well as increased exposure and availability of its products to all customers. “In 2008, we’ll most probably reach out to more prospective customers than ever before,” says Roland Lundqvist, Chief Information Officer at Komatsu Forest. The upgraded machines will tour all the major forestry conventions throughout the world. Skogsnolia in Sweden, Metko in Finland, and KWF in Germany are a few of the events at which the new machines will be shown. Also under the Valmet Tour banne, Komatsu Forest will meet customers and prospective customers at a number of locations in Sweden, Finland, and Germany. This August and September, the Valmet Tour will give visitors the opportunity to take a closer look at the new Valmet machines.

South Korea is becoming a significant user of wood and recent changes in government economic development plans indicate that the country could see significant growth in the construction of wood-frame single- and multi-family houses over the next 15 years. In contrast to Japan (a country with a long tradition of building wooden homes) and China, Korea is a relatively small wood products market (Japan’s population is more than twice Korea’s, and China has a huge wood market and a population 27 times larger than that of Korea). However, Korea remains an important wood market, importing some 85%-90% of the wood it consumes. This keeps the country highly dependent on offshore suppliers.

The total volume of softwood log imports peaked in 2002 at over 7 million m3, and has declined in the last five years to about 6 million m3 per year. New Zealand, Russia and Australia have grown their market share of softwood log imports at the expense of Chile and the US. Log imports are expected to stay relatively steady and then begin to decline (as in Japan), as the domestic sawmill industry shrinks and higher demand for sawn lumber is supplied by imports. Korea’s annual lumber imports have been relatively stable since 1999 at ~775,000 m3 (330 million bf), and softwood lumber has gained market share over hardwood lumber. Yearly domestic lumber output has averaged about three million m3 (1.3 billion bf) since 1999, with imported logs the main raw material. The last three years have seen an increase in lumber imports from 656,000 m3 (280 million bf) to 887,000 m3 (375 million bf), with all of the 35% increase coming in the form of softwood lumber. Lumber imports have gone up as log imports have declined from the 2002 peak. Canada has strongly expanded its market share at the expense of hardwood lumber suppliers (Malaysia and Indonesia). Korea’s economy appears to be following the post-war Japanese economic model. To move economic development more quickly to a higher level and improve housing and living conditions, the government has adopted a very aggressive economic makeover plan (4CNTP). This comprehensive plan includes major provisions expected to positively impact housing construction and social development in the next 15 years. Although, out of necessity, Korea has used mainly concrete building methods in the past, now growing disposable income and a desire by the government to move people out of Seoul and into new clusters of cities and towns in outlying regions will allow for more and larger single-family houses. Both of these trends are viewed as important factors in supporting greater consumption of wood in the construction and renovation of Korean homes. Source: WOOD Markets Monthly International Report, www.woodmarkets.com

Despite the slowing housing market and subsequent downturn afflicting lumber mills, forests in the Pacific Northwest remain a valuable resource with important products that are still in demand. The lumber industry is down 20% from normal production levels as many mills reduce shifts, take downtime or permanently shut down, said Gordon Culbertson, Pacific Northwest region manager for price information provider Forest2Market. But, loaded log trucks are still moving down the highway – delivering raw materials unique to the Pacific Northwest.

“Our forests have many unique attributes that cannot be found anywhere else,” Culbertson said. “Even with the negative impacts of the housing sector, the forest industry remains strong in many areas.” Forest2Market analyses the prices of logs specific to species, grade, length and diameter as they are delivered to mills. The information allows the company to track log and wood values and identify trends. One emerging trend is the resurgence of exports to Asian markets such as Japan and Korea. The dollar has weakened against foreign currencies, encouraging sales to offshore customers. Export grade Douglas fir and hemlock logs are specially selected for high-quality. These logs are cut to special lengths and command a premium of 20% more than domestic logs. Another positive trend is the plywood market, which is less reliant on the housing market. Northwest plywood products are typically used for industrial and commercial building purposes, such as concrete forms. Pulp mills are driving demand for small logs and wood chips – a byproduct of lumber production with a supply crises related to the housing market. The lack of available chips has produced a big demand for small, lower quality logs. Pulp mills are using twice as many logs as they normally would to satisfy production levels. Larger logs are also in demand for certain specialty products. Electric utilities across America have been grabbing up logs that are up to some 40 m long (120 ft) , paying a significant premium of up to $1,100 per 1,000 board feet – a common price for Douglas fir is $500 per 1,000 board feet. These exceptionally tall and straight trees are used to make poles for utility transmission lines. Power companies have been improving their decaying infrastructures and expanding services to provide for population growth. Also, sawmills cutting larger, higher quality Douglas fir logs for specialty timbers and non-housing related custom items were more resilient last year. “These are examples of healthy segments of the Pacific Northwest’s forest industry,” Culbertson said. “Lumber mills are struggling, but the forest industry is positioned to weather the economic downturn that the country is facing.”

Paso Pacifico, Carbonfund.org, the Climate, Community & Biodiversity Alliance (CCBA) and the Rainforest Alliance have announced an innovative reforestation project, Return to Forest, aimed at combating climate change, conserving biodiversity and supporting local communities in Nicaragua. This project uses carbon finance to restore approximately 410 ha of tropical forest in Central America’s most critically endangered ecosystems. The project was awarded the highest standard ‘Gold’ rating of the Climate, Community & Biodiversity (CCB) Standards. Carbonfund.org, a Maryland-based nonprofit carbon offset and reductions provider, assisted with developing the project and is its primary source of funding.

“Return to Forest is a landmark project for Carbonfund.org. It’s not only offsetting 170,000 t of greenhouse gas emissions, but also restoring tropical dry forests which are an endangered ecosystem,” said Carbonfund.org Executive Director Eric Carlson. “We’re very proud to celebrate this accomplishment with Paso Pacifico, the Rainforest Alliance and the CCBA. The partnerships formed between these organisations should serve as model for future reforestation projects that will both positively impact the local community and help mitigate global climate change.” “Small developing nations are often ignored within the climate change debate,” said Paso Pacifico Executive Director Sarah Otterstrom, “yet they are a key piece of the solution. Paso Pacifico’s efforts in Nicaragua capitalise on the great ability of tropical forests to reduce greenhouse gases while also contributing to its sustainable development.” The Rivas Isthmus in southwestern Nicaragua is a rural area that is home to a wealth of biodiversity. Through the planting of some 70 varieties of native tree species, Paso Pacífico and Carbonfund.org aim to restore a biological corridor in the region and will offset the emission of an estimated 170,000 t of CO2 over the next 40 years. The Rainforest Alliance, a nonprofit conservation organization based in New York, served as the third-party independent certifier to evaluate the project proposal to standards that ensure support for local communities, biodiversity conservation and climate change mitigation. “By earning the highest rating to the CCB standards, Paso Pacífico and Carbonfund.org have proven this project is designed in a way that will conserve biodiversity and support local communities while mitigating climate change,” said Jeff Hayward, verification services manager at the Rainforest Alliance. “Carbon finance holds great promise in helping restore endangered ecosystems such as Central America’s tropical forests, and the Rainforest Alliance congratulates both organisations on the launch of this ambitious project.” Paso Pacifico is a non-profit organisation that works to protect Central America’s Pacific slope ecosystems. The non-profit implements projects in environmental education, sustainable agriculture, forest restoration and wildlife conservation. Through these actions Paso Pacifico is creating western Nicaragua’s first biological corridor.

For more information, visit www.pasopacifico.org. Carbonfund.org works to reduce the threat of climate change by promoting cost-effective carbon reductions and supporting renewable energy, energy efficiency and reforestation projects globally that reduce and offset carbon dioxide emissions. For more information, visit www.carbonfund.org. The Climate, Community & Biodiversity Alliance sets international standards to evaluate land-based carbon projects that mitigate climate change, conserve biodiversity and support sustainable development. For more information, visit www.climate-standards.org. The Rainforest Alliance works to conserve biodiversity and ensure sustainable livelihoods by transforming land-use practices, business practices and consumer behavior.

Tembec today announced a temporary shutdown for at least three months at its Senneterre sawmill located in Quebec, effective May 9. The shutdown decision was based on the lack of wood supply in the region. “The announced shutdown is a clear consequence of the volume reduction brought about by the latest Chief Forester’s evaluation of the allowable cut in the Paix des Braves territory. Compared to 2003, Tembec’s Senneterre mill is facing a 50% cut of its available log supply, which seriously impairs our ability to maintain year round operations at current levels. Tembec finds this disproportionate reduction unacceptable. Those recent announcements are particularly alarming considering the extra efforts exerted and the losses sustained by Tembec in meeting the Natural Resources and Wildlife Department’s request to salvage the fire killed timber and provide for accelerated reforestation,” said Michel Bastien, Vice President, Quebec Division of Tembec’s Forest Products Group.

“The Natural Resources and Wildlife Department’s actions will result in extensive downtime at the Senneterre facility. Tembec has been impacted more than any other operator in the region. It is important that the Province responds positively to our request for unallocated volumes in order to give the Senneterre mill sufficient fibre to run closer to a year round basis,” added Dennis Rounsville, Executive Vice President and President of Tembec’s Forest Products Group. The Senneterre sawmill has an annual production capacity of 145,000 mbf of SPF lumber and employs approximately 160 people. Another 100 people associated with forest operations will be affected. Management has already met with employees to inform them of the company’s decision.

German power giant RWE intends to further extend its biomass activities and in particular the use of wood as fuel in cogeneration power stations. To support this strategy, RWE Innogy Cogen, a subsidiary of RWE Innogy, has signed a contract with the tree nursery P&P, based in Eitelborn, Germany. The agreement forms the basis for planting up to 10,000 ha of fuel-wood plantations in Germany over the next four years. RWE Innogy Cogen is already operating four large biomass-fired cogeneration plants based on used wood. Obtaining fresh wood from fuel-wood plantations represents an important step towards safeguarding the fuel supply of the biomass-fired cogeneration plants planned for the future. The content of the agreement is that initially ‘parent tree nurseries’ will be created for fast growing tree varieties such as poplars over an area of 300 ha.

Fritz Vahrenholt, CEO of RWE Innogy, explained; “The model which we will implement in Germany shortly is the initial basis for extending our biomass activities in other countries within Europe. We will create further fuel-wood plantations wherever it is feasible.”

Deere & Co has announced plans to significantly expand its presence in Russia, one of the most important growth markets of the company in both agriculture and forestry. Deere has signed an agreement with the Government and local authorities to invest approximately $80 million in a central operations centre which includes a distribution, replacement parts and training facility in the Kaluga region, 62 km southwest of Moscow.

“We believe this is one of the largest single investment projects of a non-Russian farm and forestry equipment manufacturer in Russia,” said Robert W. Lane, Deere & Co Chairman and CEO. “Our strategic investment reflects Deere’s confidence in the Russian and other Commonwealth of Independent States (CIS) markets. It also recognises the commitment of our dedicated Russian employees and the support of the Russian government and local authorities.” In its initial stage, the new facility in the Kaluga region will accommodate a 30,000-m2 replacement parts distribution centre, a training facility for dealer personnel, including a product demonstration site, and a whole goods distribution facility. “The site will leave room for further expansion potential as our business in Russia continues to grow,” said Mark von Pentz, President of Deere’s Agriculture Division for Europe, Africa and South America. “This new centre, which will be operational in 2010, marks a growing commitment to this important region. As an interim step for further investments, it also contains a provision for local assembly and manufacturing at a later stage.” John Deere has a long history of agricultural and forestry equipment sales to Russia. In the late 1920s, the company sold a significant number of plows and its famous Waterloo Boy tractors in Russia. The forestry markets have been served in Russia for over 30 years. In 2002 Deere opened a forestry sales branch in Saint Petersburg. Stefan von Stegmann, VP of Sales and Marketing for Deere in the CIS, Central Europe, Africa, Middle East. “This new facility in Kaluga will add significant value to our customers. It will enhance our spare parts supply, provide upgraded training facilities and appropriately reflect our commitment to this important market.”

Financial incentives for cutting carbon emissions could earn developing countries up to $13 billion in carbon credits per year – but there are several issues for policymakers to tackle first, says a new study. The study, published in the latest issue Philosophical Transactions of the Royal Society B, analyses the best ways to reward developing countries that manage to reduce their carbon emissions from deforestation. The authors estimated the carbon credits that could be generated by reducing emissions from deforestation (RED), based on annual deforestation data from 1990-2005. They found that a 10% global reduction could generate a ‘carbon finance’ of up to about $13 billion per year.

They suggest that the funding issues faced by forest conservation might be addressed by linking RED efforts with the international carbon market, responsible for transactions worth $33.3 billion in 2006. A scheme known as REDD (reducing emissions from deforestation and degradation) has been proposed for the new protocol that will replace Kyoto in 2012. But REDD will mainly benefit countries with a record of heavy deforestation, which may hinder political support from countries with a good RED record, the authors warn. According to SciDev.Net, a solution must be found so that countries with restricted deforestation are compensated. Another major concern is that countries that could benefit most from RED credits, such as the DRC and Liberia, score low on governance. These countries, say the authors, tend to have higher deforestation rates and less success in conservation. “Even if lower deforestation rates are achieved, weak governance structures may make it difficult to pass on benefits to rural populations, and corrupt government agencies may show little interest in sharing benefits fairly or support bottom-up conservation initiatives,” write the authors. Following last year’s UN climate-change meeting in Bali, there has been some debate about forest conservation methods. Suggestions have included incorporation into carbon-trading schemes and an international fund for tackling deforestation. “Given that deforestation accounts for over 20% of anthropomorphic carbon dioxide emissions, it is essential that [RED credits] are at the centre of the process,” says Matthew Owen, director of Cool Earth, a UK NGO. “Relying on a fund would give a limited amount of cash but, with RED credits, nations will be able to independently trade them in a global carbon market, that will only grow in size.”

Ponsse’s Board of Directors has decided on the new compositions of the Group Management Team and the Sales Management Group as of June 1, 2008. Mikko Laurila was appointed as a member of the Sales Management Group and Vice President responsible for the North European Business area and Sales Director for Finland of Ponsse Group. Laurila has previously acted as Ponsse’s Vice President responsible for the Asia-Pacific and Africa business areas and has been employed by the company since 1999. Norbert Schalkx has been appointed as a member of the Sales Management Group and Laurila’s successor in the Asia-Pacific and Africa business areas. Both Laurila and Schalkx report to Jarmo Vidgrén, Sales and Marketing Director.

Juhani Mäkynen, Service Director, and Tapio Mertanen, Distribution Development Director of Ponsse were also appointed as members to Ponsse’s Sales Management Group. Both Mäkynen and Mertanen report to Jarmo Vidgrén, Sales and Marketing Director. Juha Haverinen has been appointed as a member of Ponsse’s Management Team and Factory Director. Haverinen has previously acted as Production Development Manager. Hannu Kivelä, Director for Strategy and Customer Co-operation has also been appointed as a member of Ponsse Group’s Management Team. Both Haverinen and Kivelä report to Juho Nummela, President and CEO. Group’s Management Team as of 1 June 2008: Juho Nummela, Chairman Jarmo Vidgrén, Group Sales and Marketing Director, Deputy to CEO Seppo Taatila, Director for Technology and R&D Mikko Paananen, CFO Jari Mononen, Communications Director Paula Oksman, Director of Human Resources Juhani Mäkynen, Service Director Juha Haverinen, Factory Director Pasi Arajärvi, Director of Purchasing and Logistics Hannu Kivelä, Director for Strategy and Customer Co-operation Sales Management Group as of 1 June 2008: Jarmo Vidgrén, Chairman Claudio Costa, Vice President, Latin-America Tapio Ingervo, Vice President, Middle- and South Europe Mikko Laurila, Vice President, North Europe Marko Mattila, Vice President, North America Ville Siekkinen, Vice President, Russia Norbert Schalkx, Vice President, Asia-Pacific and Africa Tapio Mertanen, Distribution Development Director Juhani Mäkynen, Service Director “Ponsse Group’s Management Team and Sales Management Group have now been enforced to cover all of Ponsse’s strategically important areas. We are continuously up-to-date on the development of the market situation and can react quickly to changes in markets and customer needs and thus create the prerequisites for increasing sales. The significance of developing the service business and distribution network is continuously growing and the new appointments to the Sales Management Group support this development,” explains Juho Nummela, who is starting as CEO of Ponsse Oyj on June 1.