Chapter 4
PROFILE OF EXISTING MARKETS AND POTENTIAL MARKET PROSPECTS IN EUROPE FOR TROPICAL HARDWOODS, PARTICULARLY PLANTATION SPECIES

4.1 Introduction

This chapter concentrates on the potential market prospects for tropical hardwoods and plantation grown tropical hardwood species, particularly teak. With the exception of a few examples of `new' markets, the future market prospects for tropical hardwoods lie in existing/traditional end-use markets and the maintenance of these against competitive species and materials.

The potential market prospects for tropical hardwoods in Europe cannot be considered in isolation from other timber products and non-wood substitutes. Many of the companies contacted during the course of this study reported that an increase in the general popularity of timber products was good for tropical hardwood consumption as well. Companies also indicated that during periods of strong economic growth, high value end-use markets expanded more rapidly than medium and low value markets. This is reflected in the rapid expansion of imports of secondary processed wood products by European countries over the last decade.

Future market potential should also benefit from the favourable views of consumers in Europe with regard to the `environmental friendliness' of wood products. A survey (Pajari et al., 1999) of 6 400 consumers in Germany, France, Italy, the United Kingdom and Austria in 1996, compared attitudes towards the environmental friendliness of wood and competitive materials as well as perceptions about the sustainability of forest management in different regions of the world. It also inquired about the importance of environmental factors in purchasing decisions for furniture, windows, doors and flooring. Materials were ranked by consumers in the following descending order of environmental friendliness:

· domestically produced wood
· glass
· tropical wood
· steel
· aluminium
· plastic

Some country differences were noted. In the United Kingdom for instance, tropical wood was viewed as more environmentally friendly than all other materials including domestically produced wood, but in Germany and Austria tropical wood was ranked lower than steel, aluminium and glass. However, consumers rated environmental friendliness as a less important criterion compared with product quality, durability, style, materials used and price in making purchasing decisions for furniture, windows, doors and flooring.

4.2 Existing and potential markets for tropical timbers

Evidence from the survey suggests that, as noted above, the future markets for tropical hardwoods in Europe will generally be similar to those existing already with some shifts in emphasis. The main markets for tropical timber products are:

· joinery
· furniture
· construction and civil engineering (e.g. bridges)
· trailer flooring and bodies
· piers and jetties
· boat building
· farm gates and other fittings
· outdoor furniture
· decking
· added value products

In addition to what might be termed the `traditional' end uses (joinery, furniture, construction, etc.), a number of newer, possibly short-term, end-use markets can be identified. These include the expansion of the internal flooring market and the development of the external decking market. The development of substantial `new' markets for tropical hardwoods is, however, thought unlikely and people contacted during the survey did not identify any major new end-use markets in Europe. Of the information available on end uses, joinery is perhaps the best described. The following sections briefly review the existing joinery markets in which tropical sawnwood are utilized, and discusses some of the reasons for the loss of market share and recent market trends.

Figure 4.1 shows a breakdown of the average consumption of a number of joinery products within the nine European countries. As may be noted, more than half the tropical sawnwood consumption in this sector is used in windows and window frames. Around a quarter of consumption is accounted for by exterior doors and door frames whilst the remaining 21 percent is taken up with interior doors (6 percent) and staircases (15 percent).

Figure 4.1: End use breakdown within the joinery sector in 1993

(Source: de Boer, 1995)

Table 4.1 shows a breakdown of the consumption of tropical sawnwood in the four main joinery end uses in nine major European consuming countries in 1993. As may be noted, Germany was the largest consumer overall, accounting for some 40 percent of consumption. France and the United Kingdom then follow at around 15 percent each.

Table 4.1: Breakdown of the consumption of tropical sawnwood in joinery applications in major European consuming countries in 1993 (thousand m³)

(Source: de Boer, 1995)

4.2.1 Windows

The traditional building material for windows is wood. However, the manufacture of windows from wood, both softwood and hardwood, has lost ground in recent years to alternative raw materials, notably aluminium and PVC. The extremely rapid expansion in the use of PVC windows has resulted in substantial losses in market share of wooden windows. In several European countries, the growth in popularity of this material has been due to a number of factors including:

· something that is seen as `new' and therefore perceived by the public as better;
· cheaper prices (usually 10-20 percent compared to wooden windows);
· lower maintenance requirements;
· quick delivery and installation times;
· successful (often very aggressive) promotional campaigns.

Table 4.2 shows the relative proportions of tropical timber consumption in windows and window frames against competing materials in a number of major European consuming countries. As may be noted, in 1993, the share of tropical sawnwood in this end use was highest in Belgium/Luxembourg and the Netherlands (29 percent and 24 percent respectively). This was followed by France, Italy, Germany and the United Kingdom. The use of tropical timbers in Greece, Spain and Portugal in this end use was very low at around 1-6 percent. The situation in 1995 was very similar, except that in the main consuming countries the proportion of tropical timbers used in window applications had dropped slightly, losing ground mainly to PVC.

Although these figures are now five years old industry respondents were generally of the view that there had not been any reversal in the trend of reducing tropical timber usage in these applications. Indeed, in the United Kingdom for instance, the trend in the decline of tropical timber usage in this use continues, although the rate of decline has started to bottom out and may even be reversing to a limited extent.

Table 4.2: Percentage breakdown in tropical timber and competing material usage in windows and frames in major European consuming countries in 1993 and 1995

(Source: de Boer, 1995)

Key: TT - tropical timber; NT - non-tropical timber; Al - aluminium

The largest (albeit declining) market in Europe for windows is in Germany. This is reflected in the consumption figures for tropical timber in this sector. PVC, accounting for in excess of 50 percent market share in Germany at the present time, dominates the market. The move away from the use of tropical species in window manufacture in this sector continues, with the main competitor materials being plastics and local hardwood and softwood species. On a more optimistic note, some respondents said the image of tropical timber in Germany is getting better, which in the long run may offer new opportunities for tropical timbers.

In France, Groupe Lapeyre (a window manufacturer) reported that in 1996, the proportion of windows manufactured from wood was 29 percent whilst 49 percent were manufactured from PVC. The remaining 22 percent were manufactured from aluminium. At the present time, the windows market continues to be dominated by PVC, which now accounts for around 63 percent of sales. The market for wooden windows has been steadily decreasing, from 45 percent in 1988 to 33 percent in 1995, whilst in 2000 wood only accounts for around 27 percent of sales, with the balance being aluminium. If a similar split between tropical and non-tropical timbers to that in 1995 is assumed, then this would mean that at the present time approximately 12 percent of the windows market in France is accounted for by tropical timbers. The reasons for the rapid increase in the use of PVC are as seen elsewhere in Europe, namely, more consistent quality, lower price, lower maintenance and more persuasive marketing. Nevertheless, contacts in France reported that wood is expected to regain gradually some market share lost to PVC in this end use.

The Groupe Lapeyre also provided data (shown in Table 4.3) on the selection of different material types for windows by different end-user groups in France. The table shows distinct differences in the material choices of individuals and groups (housing associations, building contractors, councils, etc.). The table also shows that there are differences in material choice depending on the type of property into which a window is being fitted, i.e. whether it is a new building or the replacement of an old window.

Table 4.3: Differences in material choice by end-user groups in France

(Source: Gay. Groupe Lapeyre)

Table 4.4 shows the percentage difference in material types used for manufacturing windows in Italy where wooden and metal windows predominate and PVC has not achieved such large market share as it has in other European countries. It is interesting to note that in other Mediterranean countries such as Greece, Portugal and Spain, PVC does not command significant market share either and aluminium windows predominate, especially in Portugal and Spain whilst in Greece, significant quantities of non-tropical species are also used. In none of these three countries are any significant volumes of tropical species used.

Table 4.4: Production of windows in Italy manufactured from different raw materials (thousand m³)

(Source: Gardino)

(Figures in parentheses represent percentage of total for year in question.)

Gardino also provides a further breakdown on the Italian windows market by analysing the species used in window manufacture (Table 4.5). This shows that the majority (85 percent) of wooden windows are manufactured from softwoods.

Comments from people interviewed in the United Kingdom during this study would indicate that similar differences occur in Britain with local councils and housing associations also on the whole favouring PVC for renovation work. Indeed, in the United Kingdom many local councils now insist on certified timber in their projects. In new buildings, wooden window frames are gaining in popularity, however, this is almost entirely based on treated softwoods even at the very expensive end of the market. The area of the market where tropical hardwoods seem to have a position is in property renovation.

Table 4.5: Type of wood used in the manufacture of windows in Italy (number of units)

(Source: Gardino)

The timber industry has become increasingly alarmed by the loss in market share for its product in window manufacture. An increasing number of campaigns are now aimed at trying to regain some of this lost market share by emphasizing the positive aspects of using timber in window manufacture. Positive attributes of tropical hardwood windows that are and could be promoted include:

· natural durability and consequent avoidance of the need to preservative treat the wood;
· lower maintenance requirements than generally perceived by the general public;
· improved product design;
· greater valued added to a property compared to installing PVC windows;
· excellent thermal insulation;
· repairability.

4.2.2 Exterior doors and door frames

Table 4.6 shows the percentages of tropical sawnwood used in exterior doors and door frames compared with competitive materials which include non-tropical timbers, PVC and aluminium, in major European consuming countries. As may be observed, the Netherlands leads the table in terms of the proportion of tropical timber used in exterior doors and their frames (49 percent in 1995). In Germany, Belgium/Luxembourg, France, the United Kingdom and Italy, tropical timbers command around one-third of the market share in this sector. In Greece, Portugal and Spain, tropical timbers account for less than 10 percent of the market share. In all countries, non-tropical species and aluminium are the main competitive materials; PVC accounting for less than 10 percent in the majority of cases (Germany being the exception).

It may also be noted from the table that between 1993 and 1995, in Germany, Belgium/Luxembourg, the Netherlands, the United Kingdom and Italy a reduction in the share of tropical sawnwood used in door and door frames took place. The main competition was from aluminium and non-tropical timber.

Table 4.6: Percentage breakdown in tropical timber and competing material usage in doors and door frames in major European consuming countries in 1993 and 1995

(Source: de Boer, 1995)

Key: TT - tropical timber; NT - non-tropical timber; Al - aluminium

The market for internal doors, manufactured from tropical timbers, was reported in France by one agent to be have been strong for tropical timbers. Species such as wawa (samba) were popular because they were cheap, dimensionally stable and available in suitable volumes. However, this market was reported now to be under threat by panel products (which offer opportunities for tropical veneers) which are cheap and dimensionally stable.

4.2.3 Staircases

Table 4.7 shows the relative percentages of tropical sawnwood used in staircases against competitive materials which are mainly non-tropical timbers in major European consuming countries. In the Netherlands around 80 percent of stairs were constructed from tropical species and only Italy comes close in terms of tropical timber consumption in this sector at 47 percent. Apart from Portugal, Spain and Greece, whose consumption of tropical timber in staircases is relatively small, tropical timbers account for around a quarter of consumption of all sawnwood in this sector.

Table 4.7: Percentage breakdown in tropical timber and competing material usage in stairs in major European consuming countries in 1993 and 1995

(Source: de Boer, 1995)

The market for staircases was reported by interviewees to be relatively stable for tropical hardwoods. Lighter coloured species, such as beech, are being used in stair manufacture but have been found not to be as stable over long lengths as traditionally used tropical hardwood species. Staircases are therefore seen as a market that is less susceptible to changes in fashion and more dependent upon the technical properties of tropical timbers. As the average size of new houses gets smaller there is a tendency for the staircase to be incorporated into the sitting room. In such cases designers often seek to upgrade the staircase to be a feature of the room. This trend can favour the use of tropical hardwoods. However, at the lower end of the market, substitution by alternative materials, most particularly wood panel composites, should not be overlooked.

4.2.4 Furniture

After joinery products, the furniture industry is the next largest traditional market for tropical sawnwood in many European countries.

Table 4.8 gives an indication of the size of the furniture market in the European Union countries. Germany and Italy are the major manufacturers accounting for 50 percent of the European Union production and they are also the leading exporters. The two leading net importers are the United Kingdom (Euro 1.2 billion) and Germany (Euro 1.9 billion).

Table 4.8: Production, trade and consumption of furniture in the European Union in 1990 (Euro million)

(Source: UN-ECE 2000)

Wood products are just one of many materials used in the furniture industry. For instance, in the United Kingdom they account for only 11 percent of all the industry's purchases of materials. Tropical sawnwood, in turn, accounts for a relatively small share of the use of all timber products and wood-based panels (particle board, MDF, plywood). Sawn softwoods and sawn temperate hardwoods hold larger shares than tropical sawnwood in most European countries.

There are two broad categories of use for tropical sawnwood in the industry: "show wood" and "utility wood". In "show wood" uses tropical sawnwood is used for its decorative and aesthetic properties. The main types of furniture using tropical sawnwood as "show wood" are living room and bedroom furniture, tables and chairs, office and hotel furniture. In the most expensive types of cabinet furniture, solid timber is used rather than panel products for flat surfaces. In these cases manufacturers will have very specific requirements in terms of species, colour consistency, sawnwood grade, moisture content and machining characteristics. Apart from these exclusive types of furniture, most cabinet furniture with tropical timber finishes uses veneered MDF or particle board and also plywoods for flat surfaces. Solid sawnwood is often used as a lipping material in these types of product. Species used in these types of furniture are:

African: African mahogany, sapele, sipo (utile), frake, framire, okoume (mainly as plywood), niangon edinam, makore, aningeria afrormosia tola

South American: Brazilian mahogany, cedrella, virola, andiroba

Southeast Asia: dark red meranti, merbau, padauk, teak

`Utility' applications are for furniture framing, heavy duty furniture (e.g. industrial/laboratory furniture), shop and exhibition furniture. Technical properties required include ease of machining, natural durability (resistance to water and other chemicals), dimensional stability (i.e. species with small movement) and moderate cost. Species used for these types of applications include:

African: obeche, iroko

South American: Brazilian mahogany, simarupa

Southeast Asian: keruing, meranti, ramin

Conventional wood products including tropical sawnwood face increasingly severe competition from newer materials in many of these uses: forces driving substitution are complex but typically include a mix of:

· Performance characteristics including:

- decorative characteristics
- colour consistency
- natural durability
- machineability
- dimensional stability
- gluing and fixing characteristics

· Specifications and quality characteristics

- right sizes
- dimensional accuracy
- moisture content
- grade consistency
- low waste
- availability

· Commercial market characteristics

- price relative to other materials
- price stability
- costs in use
- freight costs
- meeting contract terms
- trends in market demand, e.g. fashion.

Interviews carried out for this study indicate a clear movement over the last ten years towards greater use of temperate hardwoods, panel products (particularly MDF) and other composite panels in place of tropical sawnwood in Europe. However, as explained in Chapter 3, there has been a rapid increase in the importation of furniture and furniture parts from tropical countries which offsets these trends, albeit in different segments of the furniture market.

As indicated in Section 2.1, imports of tropical veneers into UCBD countries have been on a rising trend since the mid-1990s and Section 3.2.3 commented that consumption was highest in Italy, Germany, Spain and Portugal. Much of the veneered material is destined for use in furniture but here again there is increasingly strong competition from synthetic overlays and from specialist multilaminar veneers produced particularly in Italy.

By way of illustration, Figure 4.2 summarizes some of the products substituting tropical hardwoods in the Italian woodworking industries.

Primary tropical products Substitute products

* Compression moulding products
** Stabilized wood panel

Figure 4.2: Some examples of the substitution process in the Italian woodworking industries

Figure 4.3 presents these trends in materials used in Italy in the context of the product life cycle and it can be seen that it is the newer composite materials which are in the growth and maturity phases of the cycle with plywoods and conventional veneers in the decline/revitalization stage.

Figure 4.3: Life cycle of semi-finished wood products: their situation in the context of furniture sector in Italy

4.2.5 Other markets for tropical hardwoods

As noted above, the other major existing markets for tropical sawnwood include construction and civil engineering, trailer flooring and bodies for trucks, piers, jetties and marine defence, boat building, farm gates and other fittings, outdoor furniture and decking, shutters, garage doors and mouldings. New fashion or `lifestyle' markets may offer opportunities for tropical timbers. For example, in the United Kingdom conservatories are regarded as an area where tropical timbers represent quality and have maintained or even increased market share over softwoods and other materials. Conservatories are seen as `luxury' items and the quality and durability associated with tropical timbers are positive features in the choice of material in this sector.

Traditional markets for tropical plywood are in marine applications, shop fittings, high grade furniture and (particularly in the United Kingdom) building application. One growth area for tropical plywood was identified in the transport market - in the internal fitting of mobile homes. The increased popularity of this recreational activity in a number of European countries has lead to an increase in the number of such units being built.

The traditional markets for tropical veneers still exist in plywood manufacture, and as overlays primarily for furniture applications. An increase in the use of tropical veneers for overlays in the panels product market is one large growth area at present. This market is not only as an overlay for MDF for furniture and internal fitting applications but also in the rapidly expanding laminate flooring market. The base can either be MDF, particle board or plywood, and the use of tropical plywood veneer overlay would represent the top end in these markets. However, rapid expansion of this market is leading to increased alternatives - both solid wood finishes and synthetic finishes (often with very realistic wood effects).

4.3 Current and future role of plantation grown timbers in the European market

European imports of primary processed products from tropical countries are almost wholly of timbers drawn from natural forests. Imports of plantation grown logs, sawnwood and plywood are very limited and confined mainly to teak and some mahogany (Swietenia macrophylla).

In the future, the supply potential of plantation grown timbers will increase and this raises the question of their market prospects in Europe.

Teak is the main species of plantation grown hardwood imported by Western European countries and the following section examines some features of this market.

4.3.1 European market for teak

There are no regularly published statistics on the imports of teak logs and sawnwood imported into Europe. However, an indication of possible levels of teak imports by European countries can be gained from FAO trade flow data. From this database, trade flows can be extracted for exports of logs and sawnwood of all species by Myanmar, India, and Trinidad. If it is assumed that the bulk of these shipments are of teak, some idea of the exports flowing to major European importers can be gained. Based upon this assumption, Table 4.9 shows the imports of logs and sawnwood into a number of European countries from these three countries.

Table 4.9: Imports of logs and sawnwood from Myanmar, India and Trinidad, by selected European countries in 1997

(Source: FAO)

These estimates of teak imports should be treated with caution as the figures may include other species. Table 4.9 excludes shipments from Indonesia and Thailand who also export teak products to Europe.

During the course of this study a number of companies were contacted and asked about the present role that trading in teak played in their company and what potential they could see for plantation grown species, particularly teak, in the future. The views obtained from people were very diverse, from those that thought that plantation grown teak had a great potential to play in the future to those who were adamant that they did not wish to trade in it.

Teak is a generic term that is loosely applied to a number of different species by the trade and by the public. For the purposes of this report the following definitions are used to differentiate between the different types of `teak':

Teak is sold in a number of different forms including logs, sawnwood, mouldings, veneers, teak overlaid plywood (TOP) and finger jointed or laminated veneers. More processed forms of finished products such as parquet flooring, laminated parquet, mouldings, doors, windows, furniture, cooking utensils and ornaments are also manufactured in exporting countries. Data on the amounts of teak imported in different forms and the end uses to which it is used are limited. One report (Sarsito 1995) concentrates mainly on the United Kingdom market for teak products, imported primarily from Indonesia.

The end uses of sawn teak in the United Kingdom are summarised in Table 4.10, with sales volumes and percentages for 1992 shown.

The majority of the teak used in joinery was used for doors and door frames (54 percent) windows and window frames (11 percent), wall panelling (9 percent) and `general' joinery (26 percent). `General' joinery was reported to include things such as bank fittings, bar units, radiator casings and screens. A large proportion of this teak, (65 percent), was resawn in the United Kingdom before resale to end users.

Table 4.10: Market segment for sawn teakwood by type and end use in the
United Kingdom in 1992

*NB. Since some garden furniture manufacturers had imported ready to assemble components, they may have used more sawn teakwood than the figures show

(Source: Sarsito, 1995)

Indoor furniture manufacturers used less sawn teakwood than garden furniture or joinery manufacturers, but they used more teak veneer (see Table 4.11) than sawn teakwood. In 1992, of the companies contacted, the types of furniture being manufactured from sawn teakwood and teak veneer comprised bedroom furniture (11 percent), sitting and dining room furniture (69 percent) and office furniture (20 percent).

Table 4.11: Teak veneer sales by type of end uses in the United Kingdom in 1993

(Source: Sarsito, 1995)

The same study also identified the attributes of teak which were considered important by end users. These were:

The importance of different attributes varies depending on what product is being marketed. Weather resistance, dimensional stability and price are seen as the most important factors for sawnwood with colour and figure not regarded as important. However, for veneer these latter two features are important. In the marketing of finished products the name of `teak' alone is important and implies certain attributes in itself, including weather resistance. Design and style are also important as well as finish and colour. Again, depending on the product, different marketing factors are of primary importance. The key factors by end use are summarized in Table 4.12.

Table 4.12: Marketing factors applicable to `teak'

The market for garden furniture is undoubtedly one of the most important end uses for teak, but companies contacted for the study emphasized that this has changed over the past decade. While previously a large proportion of this furniture would have been manufactured from sawnwood (or components) imported into Europe, the norm now is for garden furniture to be manufactured outside of the United Kingdom and imported. Within Europe at present, Denmark is the main producer of teak products, including furniture, which it then exports to other countries.

Teak garden products represent the middle to upper end of the market for garden furniture with major outlets in terms of volume being through do-it-yourself (DIY) stores, garden centres, department stores and high street shops. Mail order is also an important outlet. While the DIY stores generally sell the middle product range, the more expensive garden furniture is sold through the more up-market garden centres, high street shops and increasingly, mail order via the Internet.

Companies contacted during this present study were quick to distinguish between Java/Indonesian teak and `Burma' or `natural' teak and plantation teak (referring to short rotation teak grown outside Indonesia). Burma teak is regarded as the highest quality and is used in boat building for decking and trim where natural durability is of prime importance. However, this is a small market.

Denmark is the main country to trade in teak within Europe. This is partly due to the strong historical links between Denmark and the plantations in Indonesia. One company visited was actively trading and promoting short rotation, plantation grown teak from a number of different countries. However, they said that they were not the norm and that there was generally a resistance to trading in the plantation teak as it was regarded as lower quality and not having readily developed markets in which to sell. For this reason most companies in Denmark sell only Indonesian teak, for which they have a ready market, and are unwilling to spend money promoting the use of plantation grown teak. The former company takes the view, however, that the supplies of Indonesian (long rotation) teak are limited but that there are increasing numbers of younger plantations that will be selling timber in the future. They believe, therefore, that part of the future for the teak industry ultimately lies in developing markets for this short rotation, lower quality material. Opinions varied as to the acceptability of fast grown plantation teak to such manufacturers, some thought it unacceptable while others had found that a number of manufacturers liked certain features of the faster grown teak. It was also felt that the negative responses were coming more from the merchants, importers and manufacturers rather than the end users who some feel are far more willing (and even like) to accept the `natural features' or `defects' of timber such as knots, fissures and streaks in colour.

A quantity of the teak imported into Denmark is not destined to be utilized within Europe but it is then re-exported to India, a country that is regarded as probably the world's largest market for teak. India has a long tradition of using teak to `make anything and everything from it'. A proportion of these manufactured goods will then find their way back to Europe as finished products such as furniture, ornaments, boxes, etc. India is also a major buyer of teak logs that it then processes and some of this sawn teak is then sold into Europe.

While the United Kingdom and Denmark are reported to be the greatest markets for teak in Europe, it is utilized in other parts of the Continent as well. Teak is used in Germany for joinery work - principally in the north (where it is known because of the shipbuilding industry) but it is a small market. If people can afford it they may have a teak door or windows, but this is not so common in the south where the species is less well known. However, on the whole, Germany remains a small market for teak sawnwood, although the potential for value added or secondary products, as in the whole of Europe, is high.

Italy was reported to be the largest market in Europe for teak flooring. Teak flooring is known in Denmark but here its use is mainly restricted to the bathroom and kitchen.

Recent reports (hardwoodmarkets.com) postulate that the international teak market is likely to go through a period of transition, following Myanmar's moves to liberalize the teak trade and to encourage the development of private sector capacity. This will lead to substantial increases in exports. In addition to this, plantation teak supplies from other areas, particularly West Africa, are coming on stream. These plantation supplies will be of smaller sized logs. Current niche markets are reported to be over supplied and there is a need to build up a wider range of specialist markets for this timber.

4.3.2 Potential markets for other plantation grown species

A range of plantation species other than teak will come on stream in various tropical countries over the next ten years. Some of the key hardwoods will be gmelina arborea, acacia spp., eucalyptus spp., and albizia spp. Some of these plantations have been established to produce pulpwood, but some will also produce sawlogs.

The organizations interviewed in this project generally believed that markets could be developed in Europe for these timbers, but not as primary processed products. The key to success for these timbers and also lesser used natural forest timbers, was seen to be in exporting them in the form of added value products, e.g. furniture, joinery and flooring components. In this way, exporters will be able to by-pass the conservative tropical timber importing networks who handle the majority of primary processed products.

The rapid growth of exports of rubberwood added value products over the last decade is the most notable example of what can be achieved. These products, mainly furniture or furniture components, are mow major export items from Malaysia, Indonesia and Thailand. Successful marketing of plantation species therefore, depends upon product development and identification of specialized markets. Successful product development will also need to cater for the different properties and characteristics of plantation timbers such as smaller dimensions, lighter colour and colour variations, possibly lower density and natural durability than non-plantation timbers.

An interesting example of this approach came from the survey of Italy. There, one furniture manufacturer was contacted who was pursuing the approach of developing a niche market where it was the product rather than the species which was important. (The company stressed that they were atypical of most furniture makers in Italy and that the market, which they were pursuing, was also atypical of the Italian furniture market in general. However they demonstrate the potential for this material.) The company imported certified `Zambese' Teak (Baikiaea plurijuga)1 and at the time of writing they are thought to be the only importer of certified `teak' into Italy.

This Italian company imports parquet flooring and also the waste off-cuts from the parquet flooring manufacturing process. The flooring is sold directly to end users while from the off cuts they are developing a unique range of high quality furniture designed around the small dimensions that they have available. While they have had some success with selling these items of furniture in Italy they maintain that this is not because it is made from certified timber but because of the quality and design of the product. The company considers that there is little to no interest in the issue of certified timber within Italy at present and that the general public does not care about the materials used, only the end product. However, they see greater potential within other European countries, particularly Germany and the United Kingdom, where they hope to try and develop a market for high quality furniture manufacture from certified timber.

Presently this company is manufacturing its furniture within Italy but their ultimate business plan is to transfer a major proportion of the manufacturing to Zambia (the source of the raw material) while maintaining design, marketing and distribution offices in Italy. The approach of this company epitomizes in many ways what many regard as the way forward in the development of markets for plantation grown species.

1 Whilst `Zambese teak' is not a plantation grown species, it has been used as an example of the problems with its utilization which are similar to many of those for plantation species.