NTFP Research
Employment and Income Generation
Diminishing Resource
Dynamics of NTFP Use
NTFPs in the Rural Economy: Who Benefits?
Outlook
Summary
Relative to forest management for the production of timber, non-timber forest products (NTFPs) and environmental services received only scant attention by forest departments until recently. Interest in NTFPs grew slowly during the 1980s, in response to calls for using forests sustainably for the benefit of the wider society and particularly the rural population. NTFPs include plants used for food, beverages, forage, fuel, medicine, fibres and biochemicals; animals, birds and fish for food, fur and feathers; as well as their products such as honey, lac and silk (Wickens, 1994). Today's interest in NTFPs is based on the argument that in order to conserve the world's tropical forests we have to find new products, develop markets and improve marketing systems for NTFPs, so that the forests will become far too valuable to destroy (Byron and Ruiz-Pérez, 1996). Shiva (1995a, p. 333) called NTFPs the "potential pillars of sustainable forestry". The current and potential value of NTFPs for local communities is being utilized in integrated conservation and development projects (ICDPs). An underlying assumption is that communities will conserve and protect forest resources if they receive tangible benefits from sustainable forest utilization (RECOFTC, 1995). While this assumption still needs to be tested, currently local people appear to have only very limited rights to forests, despite the recognized importance of NTFPs for income generation and food security (Lynch, 1995).
More than twenty years ago, Robbins and Matthews (1974) predicted a widespread revival of interest in naturally occurring raw materials, including many NTFPs, though they cautioned that the magnitude of such revival could only be speculated. They furthermore suggested that a broader, long-term examination of the economic opportunities of NTFPs would indeed be desirable. Today, there is no dearth of research results on NTFPs. However, most studies in the NTFP sector have been descriptive, product oriented, generally not systematic, and focused on biological issues. The social science dimension has been neglected (Nair, 1995). The status and potential of many NTFPs is still not fully understood and appreciated (Gupta, 1994), there is a lack of actual production records for the majority of products and reliable data on the value of NTFPs used domestically do not exist (Silitonga, 1994). In addition, information on how to manage forests to yield a variety of products is insufficient (Wickens, 1994). Though fuelwood has received increasing attention since the onset of "the second energy crisis", only little is known about the contribution of fuelwood to national economies, employment and income generation, and how and from where fuelwood is coming to the market (Hulsebosch, 1994). Just as limited is the knowledge on use efficiencies and adoption of improved cook stoves.
Most studies are of a disciplinary nature and characterized by disciplinary biases. Research is carried out on a case-study basis, lacking evolutionary perspectives, which hinders the identification of common threads and the anticipation of trends (Ruiz Pérez, 1995). This begs perhaps the question whether we should expect any common threads and trends. In terms of natural forest endowment, climate, history, population, forest policies and economic development, the countries of the Region are just as heterogeneous as NTFPs themselves. Even within countries the conditions are so diverse that certain products are over-exploited in one area while neglected in others. It could be argued that NTFPs and their uses are so diverse that any trend and development can be predicted.
While policy-makers have tended to overestimate the employment benefits associated with timber harvests (Gillis, 1992), the significance of employment and income generation in the NTFPs sector was underestimated and remains to a large extent obscure even today. To many forest managers NTFPs are still what they used to be called until recently: minor forest products. The example of India indicates that this view is highly distorted. NTFPs contribute about 50 percent of forest revenue and 70 percent of income through export (Campbell, 1992, cited in Sekar et al., 1996). They also contribute 10 to 40 percent of income to the 50 million tribal households in India (Shiva, 1993, cited in Sekar et al., 1996), while about 200-300 million villagers depend on NTFPs to varying degrees (Shiva, 1995b). In Indonesia, the rattan industry alone provides employment for 200,000 people (Haury and Saragih, 1995). More than 320,000 people are involved in NTFP production in Vietnam (Tien, 1994) and in Bangladesh NTFPs provide employment for nearly 300,000 people (Basit, 1995). In India, 1.6 million person-years are generated in the NTFP sector (Gupta, 1994). In Malaysia, rattan collection has been estimated to contribute 14.8 percent of the economic activity of residents in the swamp forests (Kumari, 1995). These figures are impressive in themselves but are dwarfed by the number of forest dependent people and obscure the magnitude of the contribution of forest based activities to total income of many rural households, which case studies in Sri Lanka (Gunatilake et al., 1993), Indonesia (De Foresta and Michon, 1995) and India (Hegde et al., 1996) have shown to be between 50 and 75 percent.
Despite the continuing dependence of many rural people and industries on NTFPs, most products are overexploited. Destructive harvesting is rather common (Peters, 1996), thus casting some doubt on the possibility of promoting the use of NTFPs in ICDPs. The fragility of extractive economies in general and the unsustainable use of NTFPs in particular have been pointed out, amongst many others, by Peluso (1991), Homma (1992), Hall and Bawa (1993), Gupta (1994), Wickens (1994), Ros-Tonen et al. (1995) and Antolin (1995). While the diminishing natural resource can be partially explained by forest conversion and destructive timber harvesting methods, the reasons for over-exploitation in remaining natural forests are very complex.
In the past a number of social and environmental constraints held over-harvesting of NTFPs in check (Peluso, 1991). Where population numbers are low, accessibility restricted and subsistence use predominates, most products are still used sustainably and traditional restrictions and regulations are heeded. Today, however, even remote areas are accessible, resulting in the breakdown of traditional controls. As a result, very aggressive collection behaviour develops for commercially important NTFPs such as wild honey, mushrooms, rattan, bird nests and gaharu. The traditional collectors suffer most from the run on available supplies. They are usually not organized. Furthermore, the existence of monopsonies in marketing NTFPs leads to inefficiency in marketing and very low returns on labour to collectors. Market expansion for many products has led at the same time to greater competition among collectors and traders. As Basha (1996) pointed out for bamboo, the traditional NTFP sector is less harmful to the resource than the newer commercial sector. While other studies generally confirm this finding, the issue is far more complex, particularly because first there is no clear distinction between subsistence and commercial use. Second, the NTFP sector is very dynamic. As a result products recently classified as belonging to the traditional sector belong, today, to a very organized commercial sector. Even the opposite is possible when NTFPs are replaced by industrial substitutes such as plastic, and hence lose their importance altogether.
Homma (1992) has described the dynamics of NTFPs use for Amazonia. They apply also to the situation in the Asia-Pacific Region. Most NTFPs are characterized by limited quantities, seasonal availability, quality control problems, and inelastic supply. This constrains the commercial development for many products and confines their sustainable use mainly to the subsistence sector where there is no incentive to harvest more of a product than can be utilized by a household or a community (Warner, 1995). If commercial interest develops and marketing opportunities appear, exploitation intensifies (Nair, 1995) and harvest rates exceed regeneration rates, particularly in accessible areas. If returns to collectors remain low, raw material shortages are common. This development has been described for rattan (larger diameter stems of manau and batang) in Kalimantan where 80 to 85 percent of the rattan harvested come from the natural forest (Haury and Saragih, 1995). A price increase of nearly 100 percent raised the profitability of rattan collection, which enabled collectors to explore more remote areas and ended the shortage experienced in Java.
In response to labour shortages, further declining supplies and strong demand of an expanding market, domestication replaces products collected from the natural forest. It is frequently triggered by unmet demands of markets with potential (Ruiz Pérez, 1995). This explains the recent development of large scale rattan plantations in Malaysia (Poh, 1994), where the government is promoting the rattan industry for export. Other products which have been domesticated are rubber, oil palm, many tropical fruits, cocoa, coffee, tea, cardamom, cinnamon, cashew and pepper. Domestication and plantation establishment reduce production costs and increase productivity. They succeed where technologies are available, prices remain high and substitutes do not exist. If natural products can be replaced by industrial substitutes, domestication is of no or only short term significance. A prime example of industrial substitution is medicine. In Malaysia, for example, local people prefer modern over traditional medicine as the former is regarded as more effective and readily available in the rural areas (Lim and Ismail, 1994). Also, with the emergence of a growing middle class and growing domestic economies in the Region, markets shift from being supply-driven to demand-driven with higher quality expectations and requirements (FAO, 1995a). The example of the traditional umbrella and wooden clog industries in Indonesia, highlights that producers of wooden handicrafts can be affected quite rapidly by changing demands and the availability of synthetic substitutes (Hadi, 1991).
While the differences between the use and management of NTFPs on one hand and timber and natural forest management on the other cannot be denied, there are also some striking similarities. Both products are characterized by over-exploitation, affected by government regulations and their weak enforcement, and a trend towards domestication or plantation management. The biggest difference lies in the composition of stakeholders. While natural forest management in the Region is performed by government departments and capital intensive industries, the NTFPs sector is predominantly dominated by the rural poor and labour intensive small-scale industries. As will be shown below, they are not the only stakeholders determining the future of NTFPs. However, political, social and economic changes in the Region are very rapid. This very much affects people's aspirations and decisions. NTFP activities are in many situations perceived as a sponge, and their use is transitional, giving way to other enterprises and products as the economy improves (FAO, 1995a). Village life can be expected to look quite different offering constraints and opportunities for the development of NTFP collection, processing and marketing.
The benefits of current exploitation of NTFPs for commercial purposes are unequally spread among participants (Ros-Tonen et al., 1995). Low returns to labour usually accrue to collectors though there are always exceptions (Richardson, 1995). The NTFP sector has been described as a low wage trap in India (Nair, 1995) and according to Bandaratillake (1995), it is associated with a suppressive caste system in Sri Lanka. Where alternative income generating opportunities are unavailable, products are collected and sold even when prices are depressed (Warner, 1995). Studies on timber and other forest products in China suggest that farmers only capture between one quarter and one third of the huge profits occurring in the sector (Changjin, 1992, cited in Ruiz-Pérez et al., 1996). Lim and Noor (1995) described rattan gathering in Malaysia as not very attractive. On the other hand, petai (fruit of Parkia speciosa) harvesting can be quite lucrative. During good days, a harvester working alone can earn up to RM 120 (US$ 48) per day. This explains why today Malays and even Indians participate in this activity, which in the past was mostly done by aborigines living within or along the forest.
Government-run marketing and co-operative schemes have also failed to get better prices for NTFP collectors. In India, the existence of a monopsony in marketing NTFPs in tribal areas has lead to inefficiency in marketing. For example, the Large Agriculture Multipurpose Societies (LAMPs) pay poorly to even as low as 7 to 15 percent of consumer's price (Sekar et al., 1996). This indicates that government marketing agencies are less efficient in assisting farmers in marketing. In a competitive market environment, it is difficult for any government agency or non-government organization to play a major role in marketing. The prices and services as well as the friendship of the existing middlemen are far more attractive than the restricted services provided by the government agency (Lim and Woon, 1994). In addition, where markets have developed, the state's influence on production and consumption behaviour is dramatically reduced (Ruiz-Pérez et al., 1996).
The low returns to labour and the inefficiency of co-operatives to increase price levels for NTFP collectors are compounded by the high vulnerability of traditional collectors to competition (FAO, 1995a). As the example of petai indicates, outsiders are quick to recognize an opportunity. This is even the case in Malaysia where the frequency of NTFP extraction appears to be declining (Kumari, 1995). Thus, it is doubtful that accelerated commercialization will be in the interest of rural welfare if it attracts too many outsiders (Richardson, 1995).
The interest of rural welfare raises another crucial issue, that is the interest of individuals in the rural areas, the forest and the forest margin. As Byron and Ruiz Pérez (1996) point out NTFPs will continue to be very important to hundreds of millions of very poor people, but many current 'traditional' uses will decline as users' incomes rise and they can afford alternatives. While the importance of NTFPs in the rural economy has often been ignored the fact is also that in certain situations it may be overestimated. For example, in Malaysia, one of the most developed countries in the Region, NTFPs continue to be sold in various types of rural and urban markets. However, their numbers and their value relative to other goods are low. This finding is consistent with the general theory that the importance of forests as a source of extractive products declines during economic development (Vincent and Binkley, 1991, cited in Lim, Vincent and Woon, 1994).
Interest in NTFP collection and indigenous knowledge in collection and processing are not lost because a diminishing resource or restrictions reduce its availability. In many places, the returns to labour in alternative employment are more attractive. In other words, it is not in the interest of local people, be they forest dwellers or not, to remain in non-market economies (Richardson, 1995). In addition, even forest dwellers tend to replace natural products with synthetic products (Ros-Tonen et al., 1995).
The majority of rural people in the region still rely on fuelwood for domestic cooking and heating. Since the early 1980s, improved cook stoves (IC) have been developed and distributed to reduce the demand for fuelwood. Fuel savings were anticipated to be in the order of 35 to 50 percent. The urgency to tackle "the second energy crisis" of the 1980s appears to have faded. There is only very limited information available on the adoption of ICs. Regarding the efficiency of ICs it appears to be clear that the improved stoves save wood (Bialy, 1991). Field data of fuel consumption show a wide range of efficiencies, which in one study in Karnataka, India ranged from 8 to 35 percent. Some people even claimed that ICs take more fuels than traditional stoves and Ramakrishna (1991, p. 9) concludes that "by and large, users are not concerned about saving fuel".
It cannot be over-emphasized that NTFPs are an extremely heterogeneous group. They are collected for different reasons by different people. Some are consumed without any further processing and play no role in the market place. Others go through a long chain of traders and processors before reaching a highly competitive international market. Some come from the natural forests, while others have been domesticated for centuries. Others such as rattan are just in the process of domestication, or are losing their importance due to substitution by industrial products. Much of what happens in the forest, the processing industry and the market is very much influenced by the political framework conditions, socio-economic changes, market development, technological opportunities as well as people's perceptions and preferences.
Market development for most NTFPs from natural forests is difficult and time-consuming - many established or higher value products such as illipe and gaharu are already controlled by commodity traders; others yield limited returns; while some with potential are found in limited quantities on a seasonal basis and often need further research and development (RECOFTC, 1995). With regard to food processing Rice (1995) reports that it is not a programme for the faint-hearted. Also, particularly international markets demand attention to detail, quality control, service and delivery schedules that are difficult for small-scale indigenous micro enterprises to provide (McCallum and Sekhran, 1996). On the other hand, the examples of rattan in Malaysia or bamboo in China indicate that a successful processing and marketing programme can be implemented under the right economic conditions and private business interest. However, a successful programme neither guarantees sustainable production of NTFPs in natural forests nor is it likely to benefit the intended target groups. In fact, in both examples supply comes increasingly from plantations, a trend which is also described by Hadi (1995) for traditional medicines and Ahmad and Haron (1996) for bamboo.
This trend will likely continue for products of major commercial importance. Rattan will be increasingly produced in plantations triggered by unmet demands throughout the Region with Peninsular Malaysia and Sabah taking the lead. More than 21,000 ha of rattan plantations have been established in Sabah alone (Tay and Abi, 1995). Bamboo's future is mixed because of its gregarious flowering. In Thailand, for example, plantations of Dendrocalamus asper entered full production in 1994. Production and exports of bamboo shoots, however, have suffered a dramatic setback due to gregarious flowering all over Thailand that began in November 1994. By June 1995 the flowering had already meant the loss of 38,400 ha of bamboo plantations with a cost of US$ 45 million in direct investments, affecting 35,400 farmers (Thammincha, 1995, cited in Ruiz-Pérez et al., 1996).
In principle, exploitation of NTFPs from natural forests can be sustainable. In practice, it is frequently not. A necessary requirement (but not a sufficient one) for sustainable exploitation is a land tenure system which ensures exploitation rights to local extractors. Since we will not see any major changes in forest tenure, NTFPs will remain accessible not only to local people but outsiders too. Price increases will guarantee over-exploitation even in those cases where outsiders' resource access can be restricted. As Gurung (1995) reports, even in remote Himalayan regions, villagers feel the need for cash, and resources are subsequently overused. In fact, as Smits (1996) notices, the modern age has lead even in the remotest places to the abandoning of traditional ways of life. This hampers sustainable use, particularly where people view it as a backward activity, often less remunerative than alternative ways of generating income, and where pressures to change to foreign patterns of consumption grow (Ruiz Pérez, 1995). Hence, it can be safely assumed that "fewer people want to undertake the dangerous, illegal, difficult and sometimes barely profitable activities of temporary agriculture in forest lands" (Byron and Ruiz Pérez, 1996, p. 127).
A thorough analysis of the available literature allows for the prediction of almost any trend regarding the future role of NTFPs, in general, and for individual products. Based on the changes that are currently taking place, the future of NTFPs as raw materials from the natural forests of the Region appears bleak, which is not to say that NTFPs will lose their importance in contributing to subsistence economies. Over-harvesting and an increase in opportunity cost to labour make the raw material supply of NTFPs from the natural forest for many products more and more unreliable. Increasing demand will result in diminishing resource supply and trigger the process of domestication. Policy changes, described for China by Ruiz-Pérez et al. (1996), can have a very positive effect on the production and processing of individual NTFPs. However, the increase in value will rather take place outside the natural forest and not inside. It can therefore be argued that NTFPs as "pillars of sustainable forestry" have only limited potential. Furthermore, the development that can be expected casts doubts on the underlying assumption of ICDPs that communities and individuals will conserve and protect forest resources if they receive tangible benefits from sustainable forest utilization. Tangible benefits will accrue increasingly to NTFPs from plantations. This also means that the natural forests will not become valuable enough to prevent conversion to other, financially more attractive, land uses.
Ample opportunities exist for enhancing export earnings by developing appropriate facilities for processing, drying, storing, packaging, and marketing NTFPs (Gupta, 1994). Many technologies are available and need only be adapted for local use to revive, as Robbins and Matthews (1974) predicted, a widespread use of naturally occurring raw materials. A trend towards green markets (compare with certified timber) may affect the future role of NTFPs. However, this will apply only to few products and niche markets. In fact, it provides a "dangerous distraction from the political and economic changes that must be made to encourage conservation of the world's tropical forests and improve the lot of the people who live there" (Dove, 1994).
In general, it appears that the increased attention that NTFPs have received over the last fifteen years has neither affected natural forest management nor improved the livelihoods of millions of people. While the future does not have to be necessarily a reflection of the past, it can be speculated that nothing much will change over the next fifteen years with the exception that some selected products of commercial importance, particularly rattan, will be managed more intensively and fuel a growing industry.
