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FSF Report 6
Major Timber Trade Issues between Eastern Siberia and Northern China
REGION: Inner Mongolia and Heilongjiang Provinces, Peoples Republic of China
DATES OF RIDES: 28th May - 8th June 2004
PARTICIPANTS:
Andrey Laletin (FSF)
Vladimir Laletin (FSF)
David Corson-Knowles (Forests Monitor)
Josh Newell (Forests Monitor)
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Summary
During June, 2004 FSF and FM organized a joint investigation on the Russia-China timber trade. They met with government and business sector personnel in the town of Manzhouli (railway gateway situated in the border with Russia) and Dalian (the largest sea port in Northern China). They then attended an international conference in Beijing devoted to the role of China in global and regional timber trade that was organized by the nongovernmental organization, Forest Trends. Purpose The objective of this trip was to collect information on the main timber trade issues between Eastern Siberia and China. |
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Findings
The team left Russia from Zabaikalsk, entering the Chinese border town of Manzhouli by bus. This town is an important gateway for timber and oil from Western and Eastern Siberia. Here logs are reloaded and sent throughout the country, especially to the south. Each day there are about 6-8 trains carrying raw logs: each train has about sixty wagons, each of which holds about - 65 m3. of timber, mostly Siberian and scotch pine). So, every day they get about 12,000 m3. of timber from Russia. The sharp rise in oil export from Western Siberia, however, is limiting export of the wood, as there is limited rail infrastructure and oil is a more lucrative export commodity than timber. In the railway station, the team observed Tungur Loading Facility and Ardychian Loading Facility.
Workers processing timber in Manzhouli. Photo ©FSF
Near the railway station is a re-sorting yard called Jihai: workers re-sort timber by diameter and species. Then they load by trucks or by wagons. Mostly it is pine (1 m3. of pine costs about 600-800 Yuan or 55 to 73 Euro here), also there is fir, spruce, larch, birch, and a little bit of Siberian pine and aspen. They work in shifts, 24 hours a day, 7 days a week. The salary of the workers is around 500 yuan a month. This re-sorting yard is a part of the Stock Company TsinChao. It is a state company and handles the sorting.
The second largest local wood processing plant is called Oiyamuchi. They have investment from companies in Shandong Province; they send sawn and dried wood there. Every day they dry 200 m3 of timber. They have 5 drying facilities, each with a capacity of 400 m3. They saw, dry, and ship 6,000 m3. of timber per month. From Shandong they export to 24 countries, after some further processing. The amount of waste in these operation is very low, making use of almost every piece of timber. They glue small pieces into larger pieces for tables or for chairs. Chips and dust are burned to fuel the drying kilns. Unfortunately, much of the timber that reaches this sorting yard was high-graded, meaning up to 75% of the tree has been left at the felling site. In Shandong, they supply a furniture company, which works only with Scotch pine: there are about 300 workers, but following the general growth trend the company plans to expand to 700 workers by the end of the year. In 2 months, they will install 8 more drying chambers.
The largest wood processing plant in Manzhouli is Lianjun who started to build their office in August 2003. In March 2004, they had already started to work in the office. They have 89,000 sq. m. of land: they have already built 20 drying chambers, with the capacity to dry 100 m3. each. It was explained that drying birch with a diameter of 33 mm takes 12 days; pine (33 mm) - 8 days; pine (50 mm) - 12 days (to get water content down to 8 to 10 percent). They saw and dry 240 m3. a day: this year, they plan to saw 80,000 m3. and dry 60,000 m3. Birch goes to Shanghai. From there, they do not export; everything goes for internal use. In Heihe this company has a furniture factory that sells to many countries including the US. In Heihe, they saw and dry 5000 m3 of birch at a company named Lianhe. In Guangzhou, they operate under the same name - Lianhe. This December they plan to build a furniture factory on 2400 sq. m. in Manzhouli. The 150 workers work 10 hour shifts: they work with birch, pine, aspen, and larch. The larch goes to Japan.
At the Manzhouli city Commercial Bureau, Inner Mongolia of China, the team had a meeting with Vice Director Mr. Wang. He told us that during the last few years investments in Manzhouli industry increased drastically both from China, including Hong Kong, and from abroad. In 2003, they imported 6 million m3 of timber from Russia and they plan to import at a minimum about the same this year. In the first four months, they have already imported more than 2 million m3. The main problem in terms of trade with Russia, is competition for rail space with oil. For the 2nd half of 2003, they received 1 million tons of oil. In Manzhouli station, they do not have enough capacity in terms of loading facilities. In 2004, they plan to get 3.6 million tons of oil. Now they can process in Manzhouli only 10% of timber (about 600,000 m3), the rest goes to other parts of China. There is a big port - Shenzhen - in Guangdong province and another major port in the Northeast,Dalian, where they send most of the Manzhouli timber. Most of the timber is processed in China and exported through these seaports as sawn wood or as furniture. In 2003, they imported Russian goods totaling U.S. $1 billion -- mostly timber, oil, and chemicals. The timber trade is booming during the last few years. In Manzhouli, they have a zone of free trade. The most prospective industry for foreign investment is in the timber sector. In the first quarter of 2004, the government started to give the Manzhouli administration the power to give export licenses to companies directly. This will increase export volumes from Manzhouli.
The team then travelled to the port city of Dalian by train. At one of the old commercial ports, we observed a large quantity of ash logs from Primorsky Krai in the southeastern part of the Russian Far East. There is also a huge new port in Dalian, situated about 80 km from the city, which ships internationally. Almost all shipments there are loaded in containers. All of China's Northeastern provinces ship their products through Dalian port.
Finally we participated in an international conference in Beijing devoted to the role of China in the global and regional timber trade. It was organized by Forest Trends, an international NGO headquartered in Washington DC.
Ash logs at the port in Dalian. Although the harvest of ash is restricted in Russia, its export is difficult to track because it is listed under international customs code as 'other hardwood'. Photo ©FSF
Recommendations
There should be more research on verification of timber trade volumes between Russia and China There should be an initiative in China to purchase only legal timber from Russia There should be much more timber processed in Russia. Sawn timber not raw logs should be exported from Russia to China.