Soaring demand for Japanese wood in Asia

Robust demand from Asian countries such as China, the Philippines and South Korea has boosted Japan’s wood exports. In 2017, exports reached 32.6 billion yen (US$293 million), a 37 per cent growth from 2016 and the highest in 40 years.

As such, the Japanese forestry industry sees much untapped potential in Asian markets.

Jiang Jian, director of a wood trading company in China’s Jiangsu Province points out that the Chinese market needs high quality wood to accompany its economic growth and Japanese wood has advantages over that of competitors in West in terms of geographic proximity and quality.

Jiang highlighted Chinese’s need of wood to the Japanese forestry industry at a seminar in Kagoshima City attended by 60 people. Events like this are regularly held by the Japan Wood Products Export Association to match buyers from markets such as South Korea, Taiwan and Vietnam.

In 2017, Japanese wood exports aggregated at 32.6 billion yen, the second highest figure after 36.6 billion yen in 1977. Last year’s figure was boosted by Chinese demand, as exports to China hit 14.5 billion yen, 61 per cent above the previous year. The figure has risen seven-fold in five years.

Japanese wood has been used by the Chinese for building and packing materials. Some wood is reexported to the U.S. after it has been manufactured into fencing for private homes.

Trading companies such as the subsidiaries of Nippon Paper and Oji Holdings play a key role in exporting Japanese wood products. Some trading companies export wood extracted from their own forests or other private forests, and some bid to export wood from Japan’s national forests.

Four decades ago, Japan nearly ran out of wood because of heavy demand both at home and abroad. In the past 10 years, however, forest resources have recovered. Japan has set a goal to export an annual total of 1 trillion yen of food, agricultural, forestry and fishery products.

Promotion of Japanese wood products by the government and private-sector have paid off as they are now gaining recognition for its advantages. Japanese cedar is resistant to rot, while Japanese cypress has an attractive aroma – attractive characteristics to foreign markets.

The market should reach a further lift on 1st of August when China implements new building laws, which will see the acceptance of Japanese timber framing methods and allowing the use of Japanese trees such as cedar and cypress.

The Japan Wood Products Export Association has built model houses in Dalian in Liaoning Province, and Dongguan in Guangdong Province, to promote Japanese architectural styles.

Koji Fukushima, a Forestry Agency official, said that Japanese wood exports to China account for only 1 per cent of China’s wood imports.

Naoto Ando, president of the export association, said that Japan has to watch demand in export destinations. He added that certain types of timber have been depleted in Southeast Asia, opening up possible business opportunities for Japanese companies.

He gave an example in Indonesia, where the local government is preparing 800,000 wooden houses a year for low-income people, creating huge demand for wood.

“We also should promote academic exchanges, as making people understand how to use Japanese wood is very important — something we could not achieve in short time,” Ando remarked.

 

Source: Nikkei Asian Review