Logging ban still affecting Philippine manufacturers
By Thomas Russell -- Furniture Today, February 12, 2006
High Point — Some Philippine furniture makers are still dealing with the effects of a nationwide logging ban that took effect last year.
Thanks to a shortage of materials, some say prices of indigenous wood materials have risen 40% or more.
Ricardo Cagasan, general manager of Cebu-based Peba Trading and Mfg. Corp., said his company uses native woods such as gemelina and lawaan for inner frames, bases or supports. In recent months, he said, prices on those and other wood products have risen as much as 78%.
He said that has forced him to raise his own prices, but he declined to offer specifics.
Marlon Murillo, a marketing representative for Cebu-based accent and occasional manufacturer Creative Furnishings International, estimated that about 60% of his product is made from indigenous woods.
The pricing issue is of concern because it could affect Philippine companies' ability to compete with China.
Still, officials were optimistic the situation would stabilize. While the ban remains in effect in much of the country, the government has reopened several areas, close to manufacturers in Cebu.
"Admittedly, local wood prices have gone up and there is some confusion in the transport of raw materials considering that there are only two areas to date where logging is allowed," said Marlyn Siapno, executive director of the Chamber of Furniture Inds. of the Philippines, a trade group that represents 432 furniture manufacturers. "But we are optimistic that this would be cleared up as soon as the government issues the appropriate directives."
"Though there has been a movement in the prices of wood and other forest-based products, the same is not enough to affect competitiveness," said Ruby Babao-Salutan, executive director of Cebu Furniture Inds. Foundation. "So far it has had little effect on the furniture manufacturers' ability to produce. Add to this the fact that a significant number of manufacturers are already using imported species."
Officials said the situation arose last November and December after three storms in the northern part of the country resulted in massive landslides. Investigators later attributed the damage to lax enforcement of forestry laws, slash-and-burn farming, forest fires and pest and disease damage to forests. Officials also say the rains were as much as 200% heavier than normal, a factor that increased the damage.
In late 2004, the Philippine government banned logging in a move intended to stop illegal wood harvesting. Siapno said the government needed time to make sure holders of logging permits were complying with forestry regulations.
She said her organization originally supported the ban to help ensure that wood and other forest-based materials such as vines, bamboo and rattan were coming from sustainable forests. However, the CFIP and other wood industry associations also asked the government to speed up the process so it wouldn't affect the flow of raw materials.
The effect on U.S. companies importing products from the Philippines will largely depend on how much native wood is used in their product.
Platt Collections President Larry Platt said his company imports about half of its wood products from the Philippines. But he hasn't seen any effect from the logging ban, because Platt uses woods imported to the country, including African veneers and solids such as ash.
He said the native woods are good for products with dark finishes. However, because of the graining, he believes they don't show up well in lighter finishes and thus aren't useful in many Platt Collections designs.
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Logging ban still affecting Philippine manufacturers
Feb 17, 2006
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