Australia : The next target market for Indonesia

The Minister of Environment and Forestry, Siti Nurbaya, has pointed out that as Indonesian wood products come with proof of legality through the domestic legality verification scheme (SVLK) the competitiveness of Indonesian wood products has been enhanced.

She said that, compared to last year, production of wood products in Indonesia has risen and there has been an increase in export sales notably to the EU. The next target market is Australia and the government is working to reach an agreement with Australia for recognition of the SVLK as proof of legality.

In related news, the Chairman of the Indonesian Sawn Timber and Timber Manufacturers Association (ISWA), Soewarni has said the SVLK has not resulted in any significant rise in demand for Indonesian wood products saying the value of exports in the first 10 months of this year was US$1.72 billion whereas the total for the same period in 2016 was US$2 billion.

Wood products from Indonesia are exported mainly to China, Japan and Australia but while the SVLK was supposed to boost exports and export prices this has not been achieved. However, Soewarni believes in the future the SVLK could enhance the image and competitiveness of Indonesian wood products.

As if to support the views of Soewarni, the Vice Chairman of Marketing in the Association of Indonesian Furniture and Handicraft Industries (Bali), Krisna Pratama Astawa, has reported that exports by members of his Association are less than a year ago because of slow demand in the EU which accounts for around 70% of exports from manufacturers in Bali. He said there has been a 50% decline in sales to the EU.