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Monday, January 17, 2022

Exotic Timber Supply Chains: Why Imports Must Be Promoted

Columns Exotic Timber Supply Chains: Why Imports Must Be Promoted

By Musyani Siame

For the past few years, Zambia and Lusaka in particular has experienced massive infrastructure development ranging from road construction to housing infrastructure to shopping villages to story buildings to airports to hospitals etc.

Lusaka being the capital city has by far, experienced a greater share of rapid infrastructure developed than any other province. This has not only changed the face of the city but also promoted social economic development. In fact, there is efficiency in conducting business.

To reach to such an extent of infrastructure development on one hand, there is high demand for resources such as labor, finance and time including knowledge and information whether imported or not which has to be available. On the other hand, there is high need for raw materials such as cement, quarry, wire, steel etc. Even when all these raw materials matter, the allegedly favorable, common and hence priority construction material in Zambia is timber which supersedes all others in infrastructure development in Zambia. As long as there is construction taking place timber is a prerequisite raw construction material. Its demand is unprecedented. The increase in infrastructure development has drastically seen the increase in demand for softwood construction timber.

ZAFFICO being the major supplier of exotic softwood has run out of stocks to satisfy the huge market demand in the country. From about 2008 to 2014, ZAFFICO’s exotic timber replanting plan, pine in particular, was overrun by harvesting. This means that the company harvested more than it could replant. This formed a huge forest rotation imbalance which also created a huge shortage of timber on the market. As such, ZAFFICO decided to reduce the harvesting quantities of softwood trees to its customers and failed to satisfy the market demand of softwood which occured during the period of massive infrastructure development.

As a result, this prompted by then PF government to highly recapitalize ZAFFICO and embark on massive replanting of exotic trees by establishing exotic pine plantation and diversify to other products such as Jatropha in Mongu District and tea in Kawambwa District. This was done in an effort to improve the cash flow highly dominated by low revenues generated from low timber sales due to lack of timber stocks which also resulted from non-replanting of trees after harvesting. Poor forest management ravaged the tree stocking. This has a direct effect on infrastructure development.

Currently, the shortage of construction timber is not being felt because there is a cover from timber imports from Tanzania and Malawi acting as equalizers between demand and supply of softwood. Some timber traders and saw-millers have resorted to importing softwood wood from Tanzania and Malawi in order to keep their businesses afloat due to that ZAFICO reduced the quantity volumes of timber to supply to saw-millers and traders.

This is twofold effect in that; (1) Timber traders and saw-millers need to continue doing business to earn a living even in the absence of timber from ZAFFICO as a supplier (2) There is a huge market demand for timber and when ZAFFICO fail to satisfy the market, other sources such as Malawi and Tanzania supply chains become important and can jump in the loop and equalize demand and supply in both short and long term in order to avoid timber shortages. Without these import alternatives, there shall be serious shortages of exotic construction timber hence, infrastructure development will be crippled in Zambia.

My message to Saw-Millers Association of Zambia is that, please do not undermine and destroy the pine wood supply chains from Malawi and Tanzania as they are acting as market equalizers of softwood construction timber due to the fact that ZAFFICO alone cannot satisfy the current market of softwood. Saw-millers Association of Zambia must promote timber trade between Zambia and Malawi and also Tanzania so that the country can continue to have sufficient timber supplies for at least the next 15 – 20 years required for ZAFFICO to stabilize and be able to satisfy softwood timber demand on the market. It is disappointing to learn that the association is actually trying to disturb the good timber trade between Zambia and Malawi and Tanzania because of what I can call selfish interest. ZAFFICO in its current capacity has few timber stocks to give to all timber traders who apply for felling slots. The questions which we must ask are that where will the rest of saw-millers and timber traders who cannot be accommodated at ZAFFICO go? what will their businesses be? and what do they do to keep the timber industry vibrant? The only viable solution is to resort to timber imports from neighboring countries.

In fact, its high time the government reduced duty on softwood imports so that the price of timber can go down. This is for the fact that imported timber has to a greater extent contributed to skyrocketing prices of pine timber for construction due to the duty charged at the border. I strongly believe when duty is reduced or removed where possible, the price of softwood timber will be automatically adjusted downwards and this will trigger a positive effect on the construction industry as the cost of raw material will reduce.

The author is a consultant: Water Resources and Environmental Management For comments and contributions: [email protected], 0977185727

12 COMMENTS

  1. Agreed to what has been mentioned above but just to add on. When we look at the overhead power lines in Zambia it is important to keep check of their physical strength, mostly in this season of rains.

  2. Good article author, next please do one on ZESCO because here in PHI in Lusaka we were told there would be no power from 14hrs to 22 hrs today but surprisingly power went between 6 and 7 this morning, does it mean our down time will be from 7hrs to 22hrs, imagine

  3. Please understand a broken depleted ZESCO was passed onto this government
    It was under funded and positions were given to cadres
    this is going to take time to recify
    THE PRICE ONE HAS TO PAY FOR ALLOWING CORRUPTION TO CONTINUE FOR SO LONG

  4. The article is good but you needs other facts to expand on your writing.
    I am serving as Secretary General of the Zambia National Association for Sawmillers with over 1000 Sawmillers subscribing as members.
    There is no plan to stop the importation by ourselves however we want Tanzanian/Malawan Timber to conform to our structural requirements as a nation.
    It will be interesting for you to note that the best of the timber is not exported to Zambia as we have settled to less valued timber from these countries.Many customers do not know that the cheap timber coming in, does not conform to our quality as a nation.
    What we want is for Zambia to import quality timber in the quest to mitigate the high demand for timber.
    Please correct the facts

  5. The idea is to grow our own pine forests. However, if there is a deficit in the supply chain, because we didn’t plant enough trees in time, then imports will have to suffice, but the timber must be of high quality as Simbeye M, above states; although, dare I say, our government tends to shoot itself in the foot – by charging prohibitive duty on, even essential commodities the country really needs. This stumps business! I think, commodities that drive the economy should be exempt from import duty.

    #plant a tree now!

  6. Good article but lacks essence.
    It is not in order to accuse the Zambia National Association for Sawmillers (ZNAS)of trying to stop the importation of timber from Malawi and Tanzania with out asking or enquiring from the same Association as to what is prevailing on the ground. I m the public relations person for the association and therefore would have appreciated your engagement to put the records straight. The Association is not in any way trying to stop the importation of timber but insisting on level playing field. Timber from Tanzania and Malawi is good for the Industry like you said to fill up the gap , which by the way to correct you , won’t take 15 to 20 years but merely 3 to 4 years. Zaffico has plantations that will be ready for harvesting in this period especially Eucalyptus…

  7. I am the President for Zambia National Association For Sawmillers and we have never advocated for any of importation of timber but we say we should only import timber of the right quality. Zaffico’s price of round wood is twice as high as those in neighbouring countries. Timber from Tanzania for instance is landing at the cost of K90 while our timber’s production cost is around K160 for 50x150x5 m. Zaffico can only give 50cubic metres of round wood per 3 months per sawmiller. This allows the miller to work for only 8 days in 3 moths. We have 1024 sawmillers who stay idle for a longer period of the year and allowing the imports of wrong products will just kill the industry

  8. The author has emphasized on foreign timber filling the gap but has failed to understand that the local Sawmiler is being affected negatively. The high price of round wood from Zaffico concomitantly requires a high price of timber if the business is to survive. Why promoting foreign trade at the expense of local businesses? Sawmilling industry in Zambia employs over 80000 families both directly and indirectly. If local trade is killed in the name of reducing the price of timber, the timber industry including Zaffico will collapse. So when analyzing the matter at hand, be holistic and in fact broaden your perception. Reducing import of timber is good for Sawmil owners and timber traders. Government may also harness high volume of taxes and an increased GDP in this sector once timber…

  9. Mr Siame’s write-up is good but needs some more facts. I am the President for the Zambia National Association for Sawmillers and got interested in Mr Siame’s write-up. ZNAS has never thought of stopping importation of timber but to import the right and quality timber for construction and joinery. Ask those in construction and they will tell you that our Zambian timber is of a better quality. Zaffico’s price of standing timber is 2 1/2 times higher than in the neighbouring countries and we are saying let’s have a level playing field. Zaffico is giving 50 cubic metres of round wood per 3 months to the 1024 sawmillers. This amount of raw material will be worked with in 8 days of the 3 months. So as an Association, we just need a level playing field not preventing import of timber…

  10. The Author didn’t do his research properly,on the issue of duty,timber from across the border is cheaper than locally produced timber,it has contributed to low demand for locally produced timber,if he was to go on the ground today,he will find that there are piles and piles of locally produced timber.Buyers are opting to go for the cheaper low quality timber from Tanzania and Malawi.The question that the author needs to answer is,do we compromise on quality over cost just to cover the deficit?Low quality timber will obviously lead to substandard works and lead to structures collapsing.This then calls for industry players and the government to work together with timber associations in Tanzania and Malawi to ensure that good quality timber from these countries is imported to ensure quality…

  11. Zambia’s Timber problems go far beyond this article’s read. The absolute denudation of the forests and bush (all over the country) that is being harvested for charcoal is turning the country into a desert. The increased population and deforestation in the NW, the Zambezi River catchment area, is a serious future problem for our Grandchildren’s future. The rape of precious woods like Rosewood exported by the Chinese and other precious trees! needs to be brought under more strenuous control!

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