Non Timber Forest Products Manufacturing and Marketing with Special Reference to Aromatic Oils

Abstract of a presentation conducted by

T Venukasan

Department of Forestry and Environmental Science

University of Sri Jayewardenpura, Sri Lanka

Non-timber forest products (NTFPs) are any product or service other than timber that is produced in forests. They include fruits and nuts, vegetables, fish and game, medicinal plants, resins, essences and a range of barks and fibres such as bamboo, rattans, and a host of other palms and grasses. Here forest products can be classified into two main pats timber and non-timber forest products where scope of this study remains at essential oils mainly focusing on Agarwood and Sandalwood.

Agarwood is aromatic, dark, fragrant resinous substance that is produced by certain plant members of family Thymaleaceae including specially Gyrinops and Aquilaria trees. It has a high demand in globally and considered as the most expensive wood in the world. Agarwood resin formation due to natural reasons is rare and slow. Therefore resin formation is induced at commercial scale using different techniques. Both the quantity and quality of Agarwood resins is dependent on the inducement technique and therefore the use of the right method is vital to increase the product quality and income. Sandalwood oil is extracted from wood and roots of the tree. Sandalwood oil has a characteristic sweet, woody odour which is widely employed in the fragrance industry, but more particularly in the higher-priced perfumes. And also it is used in aromatherapy, cosmetic industry and to prepare soaps due to the antimicrobial activity. Unlike other aromatic wood they retain their fragrance for decades.

Citronella oil production can be highly promoted among local communities though it has been declined as it makes high profits in international market. Citronella oil is a source of important perfumery chemicals which find extensive use in soap, perfumery, cosmetic and flavouring industries. Leaves of Citronella plant are distilled to obtain valuable oil. It is a common mosquito repellent and also used in indigenous medicine as well as in flavouring food and alcoholic drinks in certain countries.

When considering the international market of aromatic oils, the current global value of the Agarwood trade is USD 6-12 billion. The annual supply of all forms of good quality Agarwood is about 6,000 MT which is 40% of the actual demand. Current market leaders in exportation of Sandalwood oil are India and Indonesia, while United States and France are the two largest importers of Indian Sandalwood oil. Although illegal logging is a major problem faced by the local industry, establishment of commercial S. album and Aquilaria plantations have recently become popular among the private sector. When Citronella oil is considered, Indonesia and China are the current suppliers for the global market. With proper technology and government support, Sri Lanka has the opportunity to become a potential exporter of Citronella oil.

Market Demand and Export of Non-Timber Products

Presented by

Sumudu Marasinghe

All the biological material except industrial round wood, derived sawn timber, wood chips, wood-based panel and pulp are generally considered as non- timber forest products. They may be extracted from natural ecosystems, managed plantations and other resources and be utilised within the household, social, cultural or religious significance. The non- timber forest products are defined as goods of biological origin other than wood, derived from forests, other wooded lands and trees outside the forests. Non- timber products which are exported from Si Lanka are mainly tea, natural rubber, coffee, coconut and coconut based products, cocoa, spices, cashew, ayurvedic & herbal products, bamboo, rattan and cane, essential oils and resins

Sri Lanka has acquired a good demand and reputation for tea and cinnamon in the world market.  Pure Ceylon tea satisfies 19% of global tea demand and Sri Lanka has become the world's third largest tea exporter to the world market. About 96% of the total tea production in our country is exported to about 40 countries. Among those countries United Arab Emirates, Russian Federation and Jordan are the major buyers for Ceylon Tea. When it comes to Cinnamon, Sri Lanka is the world's largest producer and exporter of pure cinnamon and satisfies almost 90% of demand of the world market. Sri Lankan Cinnamon has been established in the international market under the global brand name of Pure Ceylon Cinnamon and it satisfies almost 90% of demand of the world market. USA & Mexico are the main markets and it also exported to countries such as Colombia, Ecuador, Peru, Spain, Guatemala, Chile and Bolivia. Not only raw cinnamon but also value-added Cinnamon products such as oil, powder and tablets are produced and exported. And our country is in the sixth position among the global natural rubber producers. Different types of natural rubber such as ribbed smoked sheet rubber, latex crepe rubber, scrap crepe rubber and centrifuged latex are exported and rubber sector is the third largest export earner of the country. USA, Belgium, Germany, Italy and UK are the main export markets for natural rubber. And Pakistan, India, Malaysia, Japan, Germany are the main export markets for semi-processed Sri Lankan rubber. Another important category is essential oils such as Eucalyptus oil, Cinnamon leaf oil, Cinnamon bark oil and Citronella oil. Pepper, nutmeg and mace, cardamom and clove are some of the main spices which are exported from our country.

According to the Annual report of 2014 produced by Sri Lanka Export Development Board, a considerable success was achieved by all the tea products. The exports were increased in terms of both value and volume by 5.43 % and 2.35% respectively. 48.54% of total tea export earnings were gained by exporting Tea Packets and 49.10 % from exporting bulk tea. But export earnings from all categories of natural rubber were declined during the last year. Overall negative performance of natural rubber exports was -36.32%. Export earnings from coconut oil, fresh coconut nuts, coconut fibre based products and coconut shell products were increased but earnings from export of coconut powder was declined. When considering about the spices, only the exports of cardamom were increased and the exports of other spices such as pepper, cinnamon, clove and nutmeg were declined. 

Several issues in the exporting sector can be identified which inhibit the performances of the exports. Lack of policy objectives on extraction of non – timber products, lack of modern technology on extraction, lack of knowledge and attention to maintain the product quality, lack of experience and knowledge about the opportunities in the international market and competition from the other countries which have more resources and technology than our country are some of those issues. Therefore to overcome those barriers solutions should be designed and adopted such as awareness programmes for farmers to meet the international standards of the products, introducing more efficient technologies to extract the products, research and development programmes to increase the quality and purity of the products and establishing a proper database on the demand and supply of the exporting products.

Market Demand and Export of Timber

Presented by

Piyali Dias

World timber market is mainly based on primary timber products such as industrial round wood, sawn timber, wood based panels, paper, paper board and wood pulp. Moreover furniture and builder’s wood work and joinery also play an important role in the world timber market. United States, Canada and the Russian federation are the leading timber producers in the world who makes the largest contributions to the global timber production which is more than 3.4 billion m³ annually. However, more than half of this timber production is gone for wood fuel while the rest of the amount used for timber and paper products where the Europe and the United States act as the world leading timber consumers. According to the recent findings the most demanded timber product was softwood industrial round wood which was produced more than 400 million m³ of timber in the year 2013 in North America. However the highest softwood roundwood flow is going from New Zealand to China where China acts as the main importer of many timber products. Though the tropical timber market is much lower than temperate timer, industrial round woods are the most demanded item among those tropical timber products. The second most demanded item was softwood sawn wood which had a production as well as a consumption of about 96 million m³ in 2013 which was recorded from the European Union. However the wood base panels, paper, paper products and wood pulp have comparatively lower demand in global timber situation where Europe dominate the production of those products in year 2013. Among those products, particle boards have the highest production which is nearly equals to the 35.5% of the total wood based panel production. Moreover the most demanded secondary processed timber product was furniture which had recorded more than $124 million by value in the European Union flowed by the US, Italy and Germany. World furniture production is dominated by Asian countries where China appears as the highest furniture producer in the world. Sawn soft woods are the main exported product which leads the world timber exports in 2013. The Europe was the all-round exporter in each and every type of timber product including round wood, sawn wood, paper, paper board, wood pulp and wood based panels. European exports are increased by 5.6% in 2013 with 46 million m³ by volume of sawn softwood exports to the overseas markets mainly to China and North African countries. However, though the prices of timber products are slightly changing from country to country the highest market prices were recorded for paper and paper boards which is around $ 900 per metric ton while the least prices were recorded for industrial round wood as nearly $ 100 per cubic meter throughout the time period of last fifty years. In temperate region, Hem Lock, Pine, Cypress and Swedish spruce are the main traded timber species while Shorea, Dipterocarpus, Teak and Ceiba leading the tropical timber market. Though Sri Lanka is not playing any important role in the world timber situation by not exporting any timber product instead of re exporting treated, imported Kempus timber by STC while private sector is involving in exports up to some extent. But here they have to overcome some of the legal barriers such as Forest act, Import Export act and Customs act as well as some international standards which set up by world reputed certification systems such as Forest Stewardship Certification, when entering to the global export market.

Timber and Non-timber Forest Products Manufacturing and Marketing

Presented by

Yasika Subasinghe

The new forest policy of Sri Lanka includes provisions for the production of timber and NTFPs, value addition and marketing. Greater responsibility is given to local people, cooperatives, other organised groups or private bodies in commercial forest production for industrial manufacturing and marketing

According to the Central Bank of Sri Lanka, the population in Sri Lanka is still growing at a rate of 1.1%. Annual sawn-wood consumption per 1000 persons in 1993 was estimated to be 31 m³ and sawn-wood demand is projected to grow from 0.544 million m³ in 1993 to 0.885 million m³ in 2020, at a rate of 12,600 m³ per year. Demand for plywood and other wood-based panels are predicted to increase at rates of 2.8% and 3.5% respectively per year. Even though natural forests and forest plantations have the potential to supply country’s total timber demand, most of this is either in inaccessible protected area or felling is banned. Therefore, around 70% of the industrial timber have to be supplied from home gardens, rubber and coconut plantations, and trees planted along farm boundaries, on roadsides, and in urban areas.

Timber manufacturing process comprises of log sorting and barking, log sawing or breakdown, sorting and grading, drying, re-grading and surfacing. At each stage traditional knowledge in timber use and modern technology in maximization of the timber yield should be coupled together. Promoting local tree species in timber manufacturing and marketing can also be recommended.

Non timber forest products play a major role in income generation of local peripheral communities in natural forests. Under policy on wood and NTFP’s industries and marketing, a greater responsibility will be given to the local people, organized groups, cooperatives, industries and other private bodies in commercial forest production for industrial manufacturing and marketing. Efficient forest products utilization, development of competitive forest industries based on sustainable wood sources and manufacturing of value-added forest products will be promoted. Effective measures to protect the forests and prevent illegal trade in wood, NTFPs and endangered species of flora and fauna will also be instituted.

There are many non-timber forests products extracted from natural forests in Sri Lanka. Some of them are gums, resins and oleoresins, barks, leaves, flowers, fruits and seeds, flowers and their juices, leaves, grasses, bamboos, canes and creepers, Kitul (Caryota urens) products, edible plants and  medicinal plants.

When a timber product or non-timber forest product is to be manufactured or extracted the market potential for that particular product should be identified at prior stages of planning. Timber manufacturers in both government and private sectors adopt different methods of marketing their products such as holding auctions, facilitating loans for furniture, publishing in websites, paper advertisements. Considering local non timber forest products collectors there is no so called marketing procedures but sometimes intermediate buyers tend to use websites and newspaper advertisements for marketing purpose. However better techniques in yield optimization of timber and sustainable extraction of non-timber forest products should be given more consideration in achieving policy objectives.

Contribution of Sri Lankan forests to non-wood forest products

Contribution of Sri Lankan forests to non-wood forest products

Abstract of a seminar presentatation

Padmi Gunarathne

Non-Wood forest products (NWFPs) have an important role in the rural economy of Sri Lanka and they also provide benefits of considerable importance at the national level. They have a major impact on the social and economic conditions of village communities by providing a wide array of materials which enrich and diversify rural life. The knowledge, skills and social customs relating to NWFPs have been passed from one generation to the next and form part of traditional culture.

There are various categories of NWFPs available in Sri Lanka. The most important are rattan and bamboo, medicinal plants, the products of hunting, tapping, honey and grazing etc. Around 40% of the rural population in the Dry Zone is forest dependent and derives some benefits from NWFPs. The annual income from NWFPs per forest dependent household in some parts of Dry Zone of Sri Lanka is around Rs 15,000.

Kitul (Caryota urens) is the most significant NWFP in the Wet Zone and it contributes over 70% of the total income of the household engaged in this activity.

Lack of policy guidelines, a shrinking resource base and inadequate knowledge on cultivation, management, harvesting, processing and storage are identified as the major issues which hinder the development of the NWFPs sector. Major reforms in policy, legislation and management strategies, together with a coordinated effort in research on cultivation, utilization and product development, should be undertaken for sustainable development of the NWFPs sector in Sri Lanka.