T

he Indonesian Pulp and Paper Association (APKI) has called on the government to ensure domestic paper makers only purchase pulp produced under the Timber Legality Verification System (SVLK) scheme in a bid to boost local demand.

APKI deputy chairman Rusli Tan said most domestic paper producers sourced only pulp certified by the Forest Stewardship Council (FSC), an organization which promotes sustainable forestry practice across the globe.

As a result, local pulp suppliers, which already comply with the government-backed SVLK, cannot sell their intermediary goods locally and instead rely heavily on overseas markets.

'€œThe paper industry serves end customers demanding FSC-certified products, thereby the customers automatically opt for FSC certified pulp. The government needs to act to help the absorption of our pulp locally,'€ he said.

While Indonesian forest products receive a boost from the SVLK in the European market, they do not meet a similar response domestically as end users, such as banks and hotels, are now committed to buying paper made from pulp certified by the FSC only.

Like the SVLK, the FSC ensures that wood, paper and other forestry products are generated through environmentally friendly, socially responsible and economically viable processes.

As one of the world'€™s major timber producers, Indonesia began to implement the SVLK in a bid to curb rampant illegal logging in 2010.

Exports of timber and timber products stood at around US$10 billion last year.

As of last year, the installed capacity of pulp factories in Indonesia amounted to 7.9 million tons annually, according to the Industry Ministry.

The forestry industry currently contributes 0.7 percent to the national gross domestic product (GDP).

The local market was particularly important at present as global demand for pulp might well shrink by between 5 percent and 7 percent this year, Rusli added.

The short-fiber pulp price in Asia now ranges from US$550 per ton to $600 per ton in Asia, similar to that in Europe, while in North America, it hovers around $600 per ton and $700 per ton due to irregular weather and labor'€™s disputes.

In response to the group'€™s demand, Deputy Trade Minister Bayu Krisnamurthi acknowledged that promoting SVLK-certified products locally would be important to encourage the use of domestically produced forest products.

'€œIf local consumers could accept SVLK certification, it would be more efficient for producers as they wouldn'€™t need to carry out double certifications as only the SVLK would be necessary,'€ he said.

Bayu said however, there should be a further assessment to ascertain the convergence between SVLK and FSC certification.