Vigilance towards Chinese plywoods

Arser is one of the largest plywood exporters in China. This decision sets an important precedent in the effort to protect European markets from the import of illegal and high-risk tropical timber hidden behind complex global supply chains. EIA commends the enforcement of the EUTR in the Netherlands and calls on other European countries that have been major importers of the same type of product, in particular the United Kingdom (UK), Belgium, Greece and France, to follow suit in a well-coordinated approach.

European countries import enormous quantities of plywood from around the world. Plywood has been the fourth largest type of timber product imported into Europe (including the UK) by value dating back at least to 2015. In 2018, European Union countries imported US$4.7 billion worth of plywood, of which 12 percent - the largest share - came from China. This trade is also very significant for China: for the past decade, plywood has been China’s second largest timber export to Europe, just after wooden furniture.

Plywood supply chains are clear examples of the global turn the timber industry has taken in recent years. While direct trade to Europe from high-risk countries of origin has diminished, indirect routes have proliferated, making illegal and high-risk timber flows increasingly opaque and often impossible to trace. It is now common to cut trees in one continent, ship the logs to another for processing, and re-export the finished product to a third continent. For most tropical face plywood products, trees are cut in distant tropical forests such as the Congo Basin or Solomon Islands, processed in Asian manufacturing hubs like China, and then placed on European markets.

European countries have had plywood imports on their radar for years. A 2015 investigation into plywood imports from China by the UK National Measurement Office (NMO) revealed that the majority of imports did not comply with the EUTR and that importers’ due diligence systems were insufficient. In 2016, the Netherlands Food and Consumer Product Safety Authority (NVWA) found that companies importing wooden furniture from complex supply chains involving China were noncompliant with the EUTR.

As mandated by Dutch authorities, Sakol has two months to cease importing the Chinese-made tropical face plywood product in breach of EUTR. Lisa Handy, Director of EIA Forest Campaigns, explains, “This decision is significant as it delivers a blow to the protective cover that these global supply chains have provided for high risk and illegal tropical timber for years. It shows that European authorities are rising to the challenge posed by complex timber supply chains.”

The cease and desist order in the Netherlands sets a precedent for the rest of Europe, as Arser has many clients in the region, primarily in the UK, Belgium, France and Greece. Handy explains: “For the European Union to demonstrate it is truly a level playing field, and if the UK does not want to become the open back door for illegal tropical timber in the region, the decision taken in the Netherlands should trigger a domino effect across Europe. We look forward to other authorities taking similar actions.”

As the European Commission is undertaking a Fitness Check of the EUTR, the decision by the Netherlands’ authorities provides a timely reminder that EUTR, when duly implemented, is a powerful tool against the global trade in high risk and illegal timber. The UK, Belgium, France and Greece now have to show how they make the best use of this tool to combat illegal logging in some of the most threatened rainforests in the world.