The wood-based sector in Malaysia is dominated by primary processing activities of sawmilling, veneer and plywood production. However, in recent years, downstream processing activities such as the manufacture of mouldings, furniture and joinery have increased significantly.
Malaysia's export of major wood-based products has increased steadily over the last decade, from RM 4.3 billion in 1985 to RM 12.3 billion in 1995 as shown in Table 1. As a proportion of total export value, exports of logs declined from 65.0% in 1985 to 45.0% in 1990 and declined to 18.0% in 1995 following the ban on round log exports from Peninsular Malaysia and a partial ban in Sabah as well as the Government's policy to promote downstream processing activities in the sector. Exports of sawntimber also declined as sawmillers were encouraged to add higher value to their products.
Table 1. Malaysia's export of major wood-based products, 1985-1995 (RM million)2
Year |
Logs |
Sawn-timber |
Plywood |
Veneer |
Mouldings |
Furniture |
Total |
1985 |
2,782 |
1,010 |
193 |
72 |
228 |
13 |
4,298 |
1986 |
2,850 |
1,236 |
283 |
77 |
232 |
20 |
4,698 |
1987 |
4,238 |
1,680 |
480 |
103 |
315 |
45 |
6,861 |
1988 |
4,012 |
1,878 |
663 |
119 |
410 |
59 |
7,141 |
1989 |
4,356 |
2,945 |
720 |
268 |
519 |
126 |
8,934 |
1990 |
4,041 |
3,071 |
863 |
203 |
488 |
215 |
8,881 |
1991 |
4,097 |
2,901 |
1,001 |
302 |
543 |
403 |
9,247 |
1992 |
3,826 |
3,409 |
1,361 |
491 |
713 |
579 |
10,379 |
1993 |
2,914 |
4,423 |
2,660 |
705 |
585 |
936 |
12,223 |
1994 |
2,556 |
4,140 |
3,318 |
662 |
633 |
1,413 |
12,722 |
1995 |
2,273 |
3,626 |
3,521 |
575 |
618 |
1,674 |
12,287 |
In contrast to logs and sawntimber, exports of downstream products like plywood, veneer, mouldings and furniture have been increasing rapidly as the wood-based sector moves into higher value-added activities. The furniture sub-sector in particular, made an impressive impact with export share increasing from 0.3% in 1985 to 3.0% in 1990 and 13.6% in 1995. Similarly, the export share of plywood increased from 4.5% in 1985 to 9.7% in 1990 and 28.6% in 1995. The export value of mouldings grew almost threefold during the 1985-1995 period although it's share has remained constant at 5% .
A total of 7.9 million cubic metres of logs valued at RM 2.3 billion or 17.0% of total wood-based products was exported in 1995. Compared to 1994's export, this represented a reduction of 8% in volume and 11.0% in value. With the exception of a small volume (0.12 million cubic metres) from Sabah, the entire log export was from Sarawak. Major export markets for logs in 1995 were Japan (52.0%), Taiwan (16.0%), South Korea (9.0%) and China (6.0%).
Sawn-timber exports registered a total volume of 4.2 million cubic metres valued at RM 3.6 billion in 1995. This represented a decline of 9% in volume and 12.0% in value over the previous year. Sarawak was the largest contributor of sawntimber exports (1.5 million m3), followed by Peninsular Malaysia (1.3 million m3) and Sabah (1.3 million m3). Malaysia's major export markets for sawntimber in 1995 were Thailand (29.0%), Japan (12.0%), South Korea (10.0%), Taiwan (10.0%), Singapore (10.0%) and the Netherlands (7.0%). The decline in sawntimber exports can be attributed to several reasons which include the imposition of export levies/royalties on specific species of sawntimber, higher prices, reduced construction activities due to the economic slowdown in Europe and anti-tropical timber sentiments in several European countries.
Plywood exports amounted to 3.5 million m3 valued at RM 3.5 billion in 1995, which made up 27.0% of total exports of wood-based products. This reflected an increase of 17.0% in volume and 6% in value over the previous year. Plywood exports have increased significantly since the mid-80s recession, and 1995 export was more than five times compared to a decade ago. Sarawak contributed the largest export share of plywood. Major markets for plywood export were Japan (29.0%), China (26.0%), Singapore (9.0%), Hong Kong (9.0%), South Korea (9.0%) and Taiwan (6.0%). Exports of veneer in 1995 totalled 0.6 million m3 valued at RM 575.0 million. Similarly, export contribution was mainly from Sarawak and the major export markets for veneer in 1995 were Taiwan, China, Japan and South Korea.
Malaysia exported RM 618 million of mouldings in 1995 representing a decline of 2.4% compared to previous year. Peninsular Malaysia dominated the exports with RM 352 million, followed by Sabah with RM 230 million and Sarawak RM 36 million. Major export markets for mouldings in 1995 were Japan (25.5%), Taiwan (16.0%), USA (15.0%), Australia (13.0%) and South Korea (7.0%). Shortage of raw materials resulting from the high prices of sawntimber is increasingly affecting moulding factories, although the availability of rubberwood has partly alleviated the problem. In Peninsular Malaysia especially, these factories are considering obtaining sawntimber from Sabah and Sarawak or abroad to overcome the shortage of raw material supply.
The furniture sub-sector is rapidly becoming a major foreign exchange earner for Malaysia. Exports of furniture increased by 21.0% from RM 1.4 billion in 1994 to RM 1.7 billion in 1995. Ninety-five percent of the total furniture exports in 1995 comprised wooded furniture of which 80.0 to 85.0% was rubberwood-based. However, competition for rubberwood from other sub-sectors in the wood-based sector has caused the price of the raw material to escalate in recent years. The major markets for wooden furniture in 1995 were the USA (40.0%), Japan (16.0%), Singapore (10.0%), the UK (4.0%), Australia (3.0%) and Taiwan (3.0%).
Reconstituted wood-based panels (RWP) consist of medium density fibreboard (MDF), particleboard/chipboard and wood cement board. Rubberwood is the main raw material used for MDF while residues from tropical hardwood are also used in other RWP plants. Malaysia exported RM 248.5 million worth of MDF and particleboard/chipboard in 1995, an increase of 24.0% from RM 199.8 million recorded in 1994.
Malaysia is a net importer of paper and paper products. In 1995, the country imported more than 1.3 million mt. of paper and paperboard while exporting only 1,200 mt. The major paper products manufactured are writing and printing paper, toilet and facial tissue paper, Kraft/corrugating paper and joss paper.
2 The fastest growth has been for funiture (129-fold in a decade). (Editor)
