Myanmar: Two-tier log pricing ensues legality issues

The Forestry Department will no longer allow the export of wood products manufactured from the logs sold by Myanma Timber Enterprise (MTE) in local currency as products from these logs can only be marketed locally.

After the log export ban in Myanmar, the MTE decided to have two different arrangements for its sale of logs. Those for milling to meet domestic demand are priced in Kyat while logs sold to millers for processing into products for export are priced in US$.

The Local Marketing and Milling Department of MTE has already sold a considerable volume of Teak and hardwoods logs in local currency. At the same time, Export Marketing and Milling Department of MTE continues to sell logs for foreign currency.

As log stocks fell due to the suspension of logging, export-oriented mills could not get sufficient logs and so began diverting logs purchased in Kyat to export production this caused a considerable conflict.

 The MTE has managed to survive financially through income earned from log sales, especially those priced in Kyat, but the decision to stop the export of products milled from logs allocated for domestic demand could hurt the MTE financially.


Source: ITTO