via Zim seeks timber export market | The Zimbabwean 17 September 2014 by Kenneth Matimaire
Allied Timbers chief executive Joseph Kanyekanye says the country needs to expand its export market as the sector is producing more than the local market can consume.
Kanyekanye, who is also the chairman of Timber Producers Federation (TPF), said the sector had an annual production of 500,000 tonnes against the 100,000 tonnes the local market can consume.
“The timber sector has developed tremendously and has recorded growth in capacity because we produce close to 500,000 tonnes of timber every year. But in this country we do not consume more than 100,000 tonnes,” he said.
“So I think it is largely an export-led situation where we have a sustainable advantage of growing pine (and other timber species) but we now need to grow the market beyond the border,” he added.
The Allied Timbers boss said the country had great potential to spread its wings in various foreign regions, considering that it supplies the entire South American industry with seedlings.
He said the sector had prioritised value addition of timber products but its efforts had been affected by the cost of miscellaneous imported components required for the process of adding value.
“As an industry we are taking a strong stance towards value addition and have been supplying local furniture producing entities with timber. We also want to grow the industry in that direction but value addition is converting into value dissipation, because when you do value addition you are now exposed to the imported components required,” he said.
Opening up of foreign markets is expected to boost revenue for the timber sector, which has not contributed anything to the national fiscus since 2008. The markets are expected to play a significant role in the transformation of the sector after Environment Minister Saviour Kasukuwere recently ordered the forestry sector to resume making contributions to treasury.
“The forestry sector should start paying dividends to government. Government owned entities and the private sector must make contributions to the economy. We know the (forestry) sector is facing challenges but they should not continue using that as an excuse. The government must get its dues,” said Kasukuwere.
The sector has been making operational strides following the introduction of the multi-currency regime in 2009. It recorded a significant increase in its annual sales of timber products between 2009 and 2013. The TPF indicated that sales increased from $237,455 in 2009 to $65,6 million last year.
Timber products such as sawn timber, poles, wattle extract, charcoal and particle and fibre board are on the rise, while other products such as veneer and plywood, paper and paper products, and matches saw sales plunge.
Timber experts attributed the decrease towards the closure of Mutare Board and Paper Mills and Lion Match Zimbabwe. MBPM, a division of ART Corporation, closed its newsprint division in November 2009. The newsprint firm had produced 10,886 tonnes of paper and paper products, earning a paltry $8,560 in sales the same year before folding its operations.
Lion Match folded after its Workington factory went under the hammer this year. Lion Safety Matches ceased purchasing match producing timber from timber producing firms in the eastern part of the country in 2009 owing to viability challenges, said TFP chief executive officer Johnson Mhungu.
He went on to lament that though most of the products recorded significant increases, some of the figures were not a true reflection of the actual sales. He indicated that timber firms were not as forthcoming in giving their financial details as they were in providing other statistics.
“The sales figures that TPF received might not be a true reflection of what is on the ground. Companies tend to be reluctant in disclosing sales figures as openly as they disclose statistics to do with production,” he said.