6.1 Trend of wood supply and demand
6.2 Trend of wood industry
6.3 Present status of wood supply and demand
The total wood demand (in the form of logs), which has continuously increased ever since the end of the second world war, peaked in 1973 at 120 million m3, followed by a declining trend thereafter. Demand stayed at a level of less than 95 million m3 during 1981-1986 but in 1987, wood demand turned upwards again due to rapid increase the number of houses newly built by the domestic economy stimulation measures and increase in demand for paper through careless use of paper by the development of office automation. In 1987, the demand reached the level of over 100 million m3 for the first time in 7 years, and in 1989 demand reached a second record in history at 113.85 million m3, Although the demand thereafter slightly declined due to recession of economy, recovery in paper and paperboard demand pushed it back again to 111.93 million m3 in 1995.
On the supply side, domestic wood recorded over 50 million m3 during 1961-1967. Since then, imported wood increased its share steadily because it has advantages in terms of price, quantity of resources and distribution systems. Domestic wood supply eventually decreased to 22.92 million m3, which is only one fifth of the total wood supply in 1995 due to limitation of domestic forest resources and decrease in supply capacity caused by delay in the development of infrastructure of wood production. Since 1986, domestic wood continuously decreased due to lowering of supply capacity and imported wood increased steadily from year to year due to further yen appreciation. In particular, the shift from domestic broad-leaved tree chips to imported chips since the early 1990s' accelerated this declining trend.
The imported wood share rose from more than 50% of total supply in 1969 to approximately 70% in 1979. Since 1981 imported wood supply decreased due to stagnation of wood demand but resumed an increasing trend in 1986 again when yen appreciation advanced. During this period the ratio of imported wood in total wood supply stayed roughly at two thirds.
In 1992, Japan became the biggest log importing country in the world with approximately 40% of logs in international trade.
The number of sawmills in Japan had been declining since 1974, and it became 14,565 in 1995. However, since 1986, large scale sawmills with processing capacity of 300 kW2 or over increased in number (though slightly), indicating a shift of production to large-scale producers. Factory output of wood products also showed a declining trend whereby in 1995 saw a 45% decrease at 25 million m³ compared to the peak of 45 million m3 of 1973. Although factory input of domestic logs has been declining because domestic wood speciality sawmills were traditionally small scaled, the recent upward trend of large-scale domestic wood speciality sawmills helped the factory input to stabilize since 1990. On the other hand, at imported-wood speciality sawmills, arrival of logs has been decreasing since 1990 due to increase in imports of already processed wood and roundwood restrictions or shortage of the resources in the producing countries. As the trend of importing processed products is expected to advance further in the future, it is important for domestic industries to achieve reduction in processing costs and high value added as well as promotion of supply of products that meet the needs of users such as dried products, etc.
²In Japan, the capacity of sawmills is traditionally reported in kilowatts; 300KW is equivalent to about 10.000 cubic metres or more annual input of logs.
Plywood industry is the second most important wood industry after sawmilling, hut has been suffering from a structural recession since the first oil crisis. Particularly since 1985. the change of resources situation and restrictions of log export in the tropical countries in Southeast Asia coupled with their policy to promote processed products export with an aim to industrialize have greatly reduced Japan's plywood industry. Indonesia, now the largest exporter of plywood in the world, has 40% of the ordinary plywood market of Japan. On top of that, since January 1995, GATT Uruguay Round reductions of tariffs on wood products have started in stages following five year intervals, which make it urgently necessary for the plywood industry to reorganize, improve production systems, and match it to the supply of raw materials, reduce processing cost further, and promote high value added products, etc.
As regards the wood chips industry, as a result of positive promotion of import of chips by paper and pulp industry, dependence on imported chips intensified greatly; the industry faced great difficulty in securing domestic materials due to decrease in domestic resources and rise in cost. That situation has made the competition between domestic chips and imported chips ever more severe. In recent years particularly, imported chips increased even more because of yen appreciation, driving the wood chip industry into a tougher situation by pressing the price down. Number of domestic chip factories in 1995 was 3,535 or down to 46% of the peak year of 1974.
Paper and pulp industry has substantial production, with 29,663 thousand tons of paper and paperboard production in 1995 or 11% of the world's production. This was the second largest production only next to the USA, and Japan was fourth in the world in pulp production with 6% of output. Domestic paper supply can meet paper demand approximately, but supply of approximately 20% of pulp and 60% of pulpwood must be imported, thus making the steady procurement of raw materials a crucial issue for the industry.
As regards laminated timber industry, both number of factories and volume of production are on an increasing trend recently. In 1995, there were 293 factories and 582 thousand m3 of production. However, as the majority of enterprises are small-scaled, modernization of management remains a future issue.
Production of LVL (Laminated Veneer Lumber) is growing steadily in general, though production per factory in 1995 was down slightly. Number of factories in 1995 was 14, and 1 domestic LVL reprocessing factory and 1 imported LVL processing factory. Production of 1995 was 120 thousand m³.
Particleboard industry is experiencing in general smooth growth in production since it started mass production in early 1950's, and its production reached 1,252 thousand m3 in 1995. There are 15 companies with 16 factories, and many are also engaged in plywood or paper/pulp business at the same time.
Fibreboard industry is also growing generally smoothly like particleboard industry, having nine factories with production of 1,079 thousand m3 in 1995. Production of hard fibreboard is on a downtrend in recent years, and production of medium density fibreboard and low density fibreboard are on the rise. Production technology has attained stability but further reduction of absolute cost remains as an important issue.
Demand for wood (excluding pulp/paper) in 1995 is 50.38 million m3 in terms of wood for sawntimber due to the number of houses newly built, which has the biggest influence to demand for sawntimber is 1.47 million houses and 14.31 million m³ in terms of wood for plywood. Demand of wood for pulp and chips is 44.93 million m³.
Supply of domestic wood declined by 6.4% to 22.92 million m3 compared with the previous year, whereas those of imported wood increased by 4.7% to 89.02 million m3.
6.3.1.1 Demand for sawlogs
Sawlog input into factories was 36.67 million m3 in 1995 of which domestic wood was 16.25 million m3 (44%) and imported wood 20.42 million m3. Of the imported wood, 4 million m³ (about 20%) of imports was from Russian federation (so called North-Sea Wood in Japan), 1.37 million m³ (nearly 7%) from New Zealand, 13.38 million m3 (nearly 66%) are from USA and Canada (so called North American Wood, which regularly occupied approximately 70% of imported wood) and 1.25 million m3 (6%) from Tropical Asian countries (so called South-Sea Wood).
The breakdown of factory output of sawntimber by end-uses shows that the 1995 volume was 24.77 million m3 of which 80% was for construction. 9% for packing box/pallet, 3% for furniture, etc.
6.3.1.2 Demand for wood for plywood
Production of ordinary plywood in Japan was 442 thousand m3 in 1995 due to increase of imported plywood and production decline because of a slump in the market. Factory input of wood for veneer was 7.32 million m³, of which 230 thousand m3 was domestic and 7.09 million m³ foreign.
Recently, increase of coniferous wood as material for plywood is remarkable, including North-sea Larch and Radiata Pine of New Zealand, which reached approximately 20% in 1995.
6.3.1.3 Demand for pulpwood
According to the "Yearbook of paper and pulp statistics" issued by Ministry International Trade and Industry, demand for pulpwood (logs and chips) in 1995 was 37.20 million m3 with 29,659 thousand tones of production of paper and paperboard.
On the other hand, paper and pulp industry has already been promoting paper recycling from the point of view of effective use of resources and reduction of cost and the recycling ratio has reached an exceedingly high level by international standards. Ratio of recycling in 1995 was 53.4%, however, in the industry, "56% recycle of used paper in the year 2000" has been set as a target.
In recent years, with enhancement of environmental concern in the society on a global scale, hence, paper recycling is expected to be improved further for effective use of forest resources and solution of waste management.
The breakdown of supply of wood for sawing shows the North American wood leading at 37.9%, followed by domestic wood with 20.5%, South-Sea wood with 14.3% and others.
6.3.2.1 Supply of domestic wood
Supply of domestic wood in 1995 was 22.92 million m3 (excluding bed-logs for shiitake mushroom cultivation and fuelwood). Of this, logs are 22.90 million m³. The breakdown by uses of this supply of logs shows that sawlogs are 16.25 million m³, pulp/chiplogs are 5.97 million m3, plywood logs are 230 thousand m3, and others are 450 thousand m3 respectively.
By major species of domestic trees, Japanese cedar supplied 9 million m3, Japanese cypress supplied 2.9 million m3 and broad-leaved trees supplied 4.8 million m3
6.3.2.2 Supply of imported wood
With respect to the supply of imported wood in 1995, total supply of imported wood is 89.02 million m³, of which, logs were 25.87 million m3 (29%), sawntimber is 15.98 million m3 (18%), veneer and plywood 6.99 million m³ (nearly 8%) chips 26.41 million m3 (nearly 30%) pulp 11.99 million m3 (about 13%) and others 1.77 million m3 (some 2%).
