Furniture and value-added products will be key to Malaysia’s timber industry growth: Minister

YB Datuk Dr Jalaluddin Harun, Director General of the Malaysian Timber Industry Board (left) and Datuk Dr Abdul Aziz S.A. Kadir, Chairman of Confexhub Group, addressing the press at the Global Timber Conference 2016 on Tuesday. 

Malaysia must focus on delivering value-added wood products for export and reduce reliance on commodities such as logs, sawn timber and wood-based panels if it is to remain competitive in the global timber market, said YB Datuk Dr Jalaluddin Harun, director general of the Malaysia Timber Industry Board.

Such value-added products would include furniture, builders’ joinery and carpentry (BJC), and mouldings, which is set to make up 60% of Malaysia’s total wood and wood products exports by 2020, up from 44% of total exports in 2015.

“[This would require] an update on global timber outlook, demand and supply potentials as well as adoption of innovation and technology for higher value addition in advanced materials,” said Dr Jalaluddin on behalf of YB Datuk Seri Mah Siew Keong, Minister of Plantation Industries and Commodities, at the Global Timber Conference on Tuesday.

In order to retain its competitiveness, the timber industry would also need to transform itself through market development, operational efficiency, business process change and new product development, said Datuk Dr Abdul Aziz S.A. Kadir, chairman of the Confexhub Group, organiser of the Global Timber Conference.

Malaysia imported a total of US$880.57 million worth of timber and timber products in 2015, most of which are processed into furniture and re-exported back to key markets such as U.S., Europe, China and Japan. The value of imports reached RM 1.86 billion (US$450 million) in the first half of this year, a 16.4% increase compared to the same period last year.

On the other hand, log exports fell 11% in the first of 2016 compared to the same period last year, suggesting that much of this primary product has been processed into sawn timber, plywood and other wood products.

Malaysia’s total timber and timber products exports accounts for 1.36% of the global timber trade. Valued at US$5.59 billion in 2015, it is a 6.5% increase compared to the same period last year on the back of low commodity prices last year.

In addition, legal and sustainable timber products will continue to receive attention from the international community. “In this respect, Malaysia will continue to pursue timber certification as one of the main agendas to promote trade in legally harvested timber,” added Dr Jalaluddin.

The country’s national timber certification scheme, Malaysian Timber Certification Scheme (MTCS), is endorsed by PEFC. To date, more than 4.66 million hectares—or one-third—of total permanent reserved forest have been certified under MTCS.