In the recent shipment done in March 2006, about 8.00 m3 of A-grade kwila (Instia bijuga) and taun (Pometia pinnata) timber was exported to Auckland, New Zealand.
FPCD's role in the export of timber is ;
The exportation of timber
commenced in 2001 and to date more than 70 cubic meter of Kwila and Taun have
been exported. All shipments were made to Rosenfeld Kidson in New Zealand
on FOB price.
The selling prices are not standardised. Prices vary with size and species; for example: Kwila fetches higher prices then Taun - Kwila 100mm x 50mm goes for USD 410/m3 while 150mm x 50mm goes for USD 430/m3. Money received from export is twice the price of locally sold timber. Greenpeace-Pacific is negotiating on FPCD's behalf for special prices on timber.
The estimate profit calculation will be stressed; e.g. 1m3 is to be sold at the local market they are paid an average price of K600/ m3 which is less then K1,200.00 that we receive at export market in New Zealand. In such an operation three quarter of the income received is spent on the cost involved thus, 3/4 of K600.00 i.e, K450.00, operational cost and the profit is only K150.00. Likewise, 3/4 of of the export income K 1,200.00, i.e. K900, is the operational cost and the profit is now K300.00. Therefore export profit is twice that of the local market and thus it is preferred over local sales.
The income generated from the export has been invested in small businesses, paying of school fees, medical fees and even boosting their sawmill business. FPCD also assist resource owners to open bank accounts to transfer their money from export sales into their account. About 15-20 members of MFROA benefited directly while 30-5 members benefited indirectly.
MFROA's timber buyer for the export market in New Zealand is Rosenfeld Kidson. They support timber suppliers whos products are coming from a well managed forest. The market in New Zealand was arranged by Greenpeace Pacific. They support community and sustainably managed forest. FPCD has also established relationship with local buyers who offer good prices and charge reasonable transport price to collect timber from the milling site.
In PNG it is common for small scale sawmilling to fail in terms of commercializing the operation. However, this has been proved that it can be successful and the resource owners can mill and export their own timber. Therefore, Eco-forestry and small scale sawmilling is to continue in Madang with the members of MFROA and projected to other provinces of Papua New Guinea.
FPCD and METCorp are currently exporting under the "Eco-timber" label however, once FPCD attains its group certificate under the Indigenous Community Forestry (ICF) Group Certification Scheme, it will export its timber and any potential non timber products under the FSC label.
Timber that is milled from resource owners forest area are graded and scaled for local and export sales. A-Grade premium species are exported.
Trees are felled and milled according to export demand from buyers.
