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The Global Forest Products Industry Grew by 3.7% in 2011


Because of on-going financial difficulties being experienced in many nations around the world, the forest products industry in a myriad of countries has suffered. As a result, despite strong growth from the South American region, the global value and consumption of the forest products industry suffered a significant decline over the period 2007-2011.

The global forest products industry grew by 3.7% in 2011, to reach a value of $264.2 billion, representing a compound annual rate of change of -4.5% for the period spanning 2007-2011.

This performance was primarily driven by large declines in the United States and Europe as western economies continued to stagnate and the demand for timber and paneling from construction dried up. Normally a hotbed of growth, even Asia-Pacific suffered a decline as China (which has bucked the trend during the last few years, showing remarkable growth in many industries whilst other countries suffer a decline) and Japan both suffered declines.

South America continued to show remarkable growth during 2007-2011 with a compound annual growth rate of 10.8%. This can be primarily attributed to Brazil which experienced exceptional growth across 2007-2011.

The forest products industry is subject to a variety of laws, legislation and governing bodies. For example, the EU Timber Regulation, which comes into force in 2013, prohibits operators from placing illegally harvested timber and timber products on the European market. This applies to timber both imported into and produced within the EU. This is overseen by the Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan, which sets out a range of measures available to the EU to tackle illegal logging in the world’s forests.

Furthermore, in April 2012, Brazil’s Congress voted to ease rules mandating the amount of forest farmers must keep on their land; however the bill will require millions of hectares of already cleared land to be replanted. Critics claim it makes it too easy for farmers, responsible for much of the deforestation of the Amazon rainforest, to comply with regulations that stipulate how much forest they must preserve. This legislation is yet to be enforced and can still be vetoed by the country’s President, however if it is enforced it will have implications for the Brazilian forest products industry.

Another issue the forest products industry has embraced is sustainability: established in 1993, the Forest Stewardship Council (FSC) is an independent, non-governmental, not-for-profit organization established to promote the responsible management of the world’s forests. The FSC is nationally represented in more than 50 countries around the world and offers certification which ensures consumers they are contributing to the responsible production and consumption of forest products.

Access forecasts for the forest products industry to 2016 in various countries, click here…

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