5. THE AVAILABILITY OF RAW MATERIALS

5.1. The availability of large diameter roundwood
5.2. The availability of small diameter plantation industrial roundwood
5.3. The availability and use of mill residues
5.4. The availability and use of Rubberwood
5.5. The possible use of Oil Palm fibre residues
5.6. The use of Agricultural residues

5.1. The availability of large diameter roundwood

Hardwood log production from South East Asia has been the mainstay of the Asian plywood industry for the last twenty five years, but has been in steady decline for almost the last ten years. Hardwood log production reached a peak of 110 million m³ in 1989, but is currently down to about 98 million m³ per year and is expected to drop below 80 million m³ per year by 2010. This reduction could be even greater as several Governments have endorsed ITTO targets to achieve sustainable forest management levels and practices by the year 2000, and if these practices are strictly enforced, logging levels in Asia could drop below 70 million m³ per year by 2010.

Another factor affecting Hardwood log supply is that extraction costs from natural forests are rising as the loggers are having to haul logs much greater distances from the forest areas to the mills or the ports. Log diameters are also dwindling (as undisturbed forest areas are becoming much rarer), making high recovery yields more difficult. The net result of all these factors is a steady increase in the cost of good quality peeler logs, reducing the ability of plywood to compete with alternative panel products.

Small quantities of Softwood logs are being used for plywood peeling as substitutes for hardwood logs in some countries, with softwood log supplies being sourced from natural softwood forests in Russia, and Radiata Pine plantations in New Zealand and Chile. China, Japan, Republic of Korea, and Taiwan Province of China already process about 5 million m³ of domestic and imported softwood logs, through their plywood industries, and this volume could increase to perhaps 12 million m³ per year by 2010.

5.2. The availability of small diameter plantation industrial roundwood

The growing use of plantation grown Radiata Pine logs from New Zealand and Chile to substitute for Hardwood peeler logs in North Asian plywood mills has been discussed in the previous section, but should be recognised as an important contribution to the overall Asia Pacific wood based panel raw material supply situation in future.

China currently has some 2.5 million ha of industrial plantations which supply valuable roundwood supplies to China's sawmilling and wood based panel industries, and under current Government plans aiming for self sufficiency in timber resources by the year 2040, the industrial plantation area should increase steadily to around 20 million ha by that time.

Radiata Pine harvesting from existing New Zealand plantations should increase to about 26 million m³ per year in 2010, and similar plantations in Chile could be producing around 14 million m³ per year by the same date.

Though much of it was planted for the pulp and paper industry, Acacia, Gmelina and Eucalyptus plantations in Indonesia and the Philippines currently cover about 700,000 ha and, if maintained and enhanced could be contributing reasonable quantities of timber raw material by the year 2010. Indonesia also some 800,000 ha of Teak plantations in Eastern Java, some of which are over 80 years old and already yielding high value raw material for decorative veneers and other applications.

Other areas of industrial roundwood plantations include 190,000 ha in Thailand consisting of Eucalyptus, Casuarina, Acacia and some Teak; 108,000 ha in Malaysia consisting mainly of Acacia, Gmelina and Eucalyptus; and 600,000 ha of mixed industrial plantations in Vietnam.

5.3. The availability and use of mill residues

The majority of reconstituted wood based panels utilise a certain amount of mill residues, but these account for only a small proportion of the total potential available in the Asia Pacific region.

Table A.4 - Sawmill And Plymill Residues - 1995

Country	Saw Residues 1,000 m³	Ply Residues 1,000 m³	Total Residues 1,000 m³
China	16850	5100	21950
Japan	17500	3200	20700
Republic of Korea	2100	600	2700
Taiwan Province of China	650	300	950
China, Hong Kong SAR	300	0	300
NORTH ASIA	37400	9200	46600
Indonesia	5600	6700	12300
Malaysia	6300	3000	9300
Thailand	480	250	730
Philippines	330	210	440
Vietnam	570	30	600
Myanmar	230	0	230
Other S.E. Asia	320	80	400
S. EAST ASIA	13830	12270	26100
India	11650	250	11900
Pakistan	1000	10	1010
Nepal	410	0	410
Other S. Asia	80	0	80
SOUTH ASIA	13140	260	13400
Australia	2130	120	2250
New Zealand	1850	250	2100
Other Islands	160	40	200
OCEANIA	4140	410	4550
ASIA PACIFIC	68510	22140	90650

Assuming an average product recovery of 60% from all sawmills and plywood mills in the region (which is almost certainly not achieved in most countries), the total availability of wood residues from sawmilling and plymilling in 1995, around the region, would be as shown in Table A.4.

Even at a generous ratio of 1.5 m³ of wood residues to produce 1 m³ of reconstituted wood based panel, the availability shown in Table A.4 is sufficient to produce around 60 million m³ of particleboard, MDF or other fibreboard.

Yet the record shows that, in 1995, only some 15.5 million m³ of reconstituted wood based panels were produced in the Asia Pacific region, and quite a high proportion of that total was produced from small diameter roundwood, either from rubberwood clearances or thinnings from industrial timber plantations. A smaller but not insignificant proportion of the panels were also made from agricultural residues such as bagasse, wheat straw or cotton stalks.

Table A.5 below attempts to show the proportion of the Asia Pacific production of reconstituted wood based panels manufactured from mill residues in 1995.

Table A.6 - Reconstituted WB Panel Production - 1995

Product & Sub Region		Total Production 1,000 m³	Utilising Wood Residues 1,000 m³
NORTH ASIA
	Particleboard	6250	5000
	MDF	1580	1260
	Other fibreboard	2070	1660
	TOTALS	9900	7920
SOUTH EAST ASIA
	Particleboard	1870	930
	MDF	750	150
	Other fibreboard	160	160
	TOTALS	2780	1230
SOUTH ASIA
	Particleboard	470	370
	MDF	60	30
	Other fibreboard	60	30
	TOTALS	590	430
OCEANIA
	Particleboard	1030	620
	MDF	1020	620
	Other fibreboard	190	110
	TOTALS	2240	1350
TOTAL ASIA PACIFIC
	Particleboard	9620	6920
	MDF	3410	2060
	Other fibreboard	2480	1960
	TOTAL PRODUCTION	15510	1094

The estimated figures in Table A.5 showing actual use of wood residues, are based on the author's experience and local knowledge of the region, and are probably generous, but even they indicate that there are unused wood residues in the mills of the Asia Pacific capable of producing around another 50 million m³ per year of particleboard, MDF or other fibreboards.

5.4. The availability and use of Rubberwood

Rubber plantations in South East Asia now total some 6.6 million hectares and, though declining in area in Malaysia, are increasing in Indonesia, Thailand, Vietnam and Cambodia.

Under perfect conditions, with constant 28-30 year rotation, and an estimated per hectare yield of 70 m³ of small diameter sawlogs and 170 m³ of even smaller diameter roundwood residues, the rubber estates of the region could theoretically yield an annual total of some 15.4 million m³ of sawlogs and 37 million m³ of roundwood residues. The sawlogs, in turn, could yield about 5.4 million m³ of sawnwood plus 10 million m³ of sawmill residues, bringing the total available residue material suitable for reconstituted wood based panels to some 47 million m³ per year.

Reality, as usual, is a very different picture. A very high proportion of the planted areas of rubberwood are in the hands of smallholders, many of whom have only a few hectares of (usually) very over-mature trees (particularly in Malaysia and Thailand). The level of sawlog production achieved from smallholdings varies from a high of 45% of potential in Thailand to only 10% in Malaysia. Many large rubberwood estates in Malaysia have either been broken up into smallholdings or largely converted to oil palm plantations, which have yielded higher returns in recent years.

The estimated potential output of the rubberwood plantations in South East Asia over the coming twenty five years is given in Table A.6 below:

Table A.6 - Rubberwood Sawnwood & Panel Potential (1,000 M³)

Product & Country		95-99	00-04	05-09	10-14	15-19
SAWNWOOD	- Malaysia	458	583	512	600	300
	- Indonesia	411	569	702	807	892
	- Thailand	614	744	821	759	649
	- Cambodia	62	72	52	52	40
	- Vietnam	75	0	0	115	410
	TOTALS	1620	1968	2087	2333	2291
PBD OR MDF	- Malaysia	865	845	680	675	316
	- Indonesia	650	720	860	855	800
	- Thailand	660	660	660	660	660
	- Cambodia	150	150	150	150	150
	- Vietnam	0	0	0	225	800
	TOTALS	2255	2275	2200	2515	2566

Source: Sylva Futura

The figures in the above table are for possible potential yields of sawnwood (top half), and either particleboard, MDF or any other reconstituted wood based panel (bottom half).

Though it will continue to be an important ancillary raw material source for the reconstituted wood based panel industries of South East Asia, rubberwood supply is made extremely difficult by the severe fragmentation of estates into smallholdings and, as can be seen, rubberwood as a raw material is unlikely even to achieve 10% of its theoretical potential for the wood based panel industry.

5.5. The possible use of Oil Palm fibre residues

The use of Oil Palm fibre for reconstituted wood based panels has been the subject of many tests and trials over recent years, but with the apparent decline in the long term potential of rubberwood, these tests have assumed added urgency. Some very recent work has shown that acceptable board properties and economic advantages can be achieved with the fibre material in the rejected part of the bunch, after the oil has been squeezed out at the palm oil mill. The oil palm fronds which fall regularly from the palms are also showing promising results, but the probable cost of collection is thought to rule out any economic advantage.

There are currently some 4 million ha of Oil Palm estate in South East Asia and the research work is being watched with great interest by both potential producers and manufacturers of machinery. At a conservative estimate of 1 ton per day of used bunch fibre and fallen fronds per hectare, the total possible fibre availability in the Oil Palm estates of South East Asia is a staggering 1 billion tons per year. If the trials are successful and lead to full commercial production of wood based panels, the industry will quickly adapt to the new situation, as oil palm fibre from used bunches has the advantage over rubberwood that it is collected in small quantities every working day, on every oil palm estate, and is thus a much more regular raw material source.

5.6. The use of Agricultural residues

The history of the use of agricultural residues in particleboard and fibreboard is a long and well documented story, which includes successful trials and pilot plants using such materials as bagasse (de-pithed sugar cane), cotton stalks, wheat straw, rice husks and many other materials, in several Asian countries.

Partly because of quality control problems, but mainly because of the seasonal nature of agriculture, the really large scale successful panel plants using agricultural residues are few and far between. When cotton or sugar cane for example have only one cropping season per year, sufficient raw material has to be collected, treated, baled and stored in one short period to enable the panel plant to operate throughout the year.

There is no shortage of the various potential raw materials, but the economics of the plants will depend firstly on the cost of collecting the raw materials from, possibly, many small and scattered locations, with only rudimentary transport infrastructure. The second problem, referred to above, is the cost and practicality of storing and preserving a years supply of raw material in one (or perhaps two) short harvesting seasons.

The principle appears to work reasonably well with very small plants in rural locations (in say China or India), and where export standard product quality is not required. But recent efforts to utilise bagasse in larger scale MDF plants in the Guangdong province of China did not work well, and the plants reverted to wood waste raw material.

With the expansion of particleboard and MDF production in the Asia Pacific region to some 40 million m³ per year, over the next 15 to 20 years, more work will be needed in efforts to harness this abundant raw material to the needs of the modern, large scale wood based panel mills of the future.