PlanetArk 17 Mar 09;
ROME (Reuters) - The global financial crisis and the collapse of the housing sector are a big blow for wood industries, but this is not necessarily good news for the world's forests, a new U.N. report said on Monday.
The report, published ahead of a conference on forestry held in Rome by the Food and Agriculture Organization (FAO), noted new housing starts in the United States had more than halved between 2006 and 2008. Several other countries, particularly in western Europe, have witnessed similar declines.
"Wood demand is unlikely to reach the peak of 2005-2006 again in the foreseeable future," the FAO's "State of the World's Forests 2009" report said.
"Scaling down of production is widespread in almost all countries and all forest industries, from logging to sawmilling to production of wood panels, pulp, paper and furniture," it said.
Countries that are highly dependent on U.S. markets, such as Brazil and Canada, have already been severely affected, the report said, adding wood fiber demand in North America alone was expected to fall by more than 20 million tonnes this year.
While lower wood demand should be good news for the world's disappearing forests, FAO said the economic crisis could reduce investment in sustainable forest management and favor illegal logging.
"A more general concern is that some governments may dilute previously ambitious green goals or defer key policy decisions related to future climate change mitigation," the report said.
It said European Union measures to tackle climate change, particularly auctioning emission allowances, were meeting some resistance, and the U.N.'s REDD scheme -- aimed at using carbon credits to save rainforests -- could face similar problems.
Worldwide, the loss of forests was 7.3 million hectares (18.04 million acres) a year between 2000 and 2005, equivalent to 200 square km per day, according to U.N. data. Deforestation accounts for 20 percent of man-made carbon emissions.
(Reporting by Silvia Aloisi; editing by James Jukwey)
Forests 'facing a testing time'
Mark Kinver, BBC News 16 Mar 09;
World forests face the dual challenge of climate change and the global economic crisis, a key UN report says.
It suggested that although the economic slowdown might reduce deforestation rates in the short term, it was also likely to lead to other problems.
One concern, would be a lack of investment in the sector and in forestry management.
The study by the UN Food and Agriculture Organization (FAO) was published on Monday.
It is timed to coincide with the start of UN World Forest Week.
CTS Nair, one of the report's lead authors and the FAO Forestry Department's chief economist, said the economic crisis was having "tremendous impacts - both positive and negative".
"You will find the forestry industries in a number of countries almost on the verge of collapse," he told BBC News.
For example, he said the construction of starter homes in the US and Canada had fallen from about two million units at the end of 2005 to less than 500,000 now.
This had led to a dramatic fall in the demand for wood products, which was affecting forest-based industries and export markets in developing nations.
However, Mr Nair added, the downturn was having some beneficial effects.
"We are seeing a decline in the prices of soya beans, palm oil and rubber etc," he explained.
"The prices have fallen drastically, so this means that the incentives for cultivating these crops have also gone down.
"As a result, the pressure to clear primary forest stands is also declining."
Mixed picture
The report, State of the World's Forests 2009, also showed that the health of forests varied from region to region of the world.
"We see advances being made in places like Europe, but losses being made in places like Africa and especially developing countries," Mr Nair observed.
"For example, what we see in the case of Africa is that there is a growing population yet the productivity within agriculture has remained extremely low.
"There is very little diversification in terms of sources of income so there is a very high dependency level on land use and natural resources, such as timber."
"On the other hand, in places such as Asia where there has been rapid economic growth, people have moved out of agriculture to some extent and the pressure on the land has declined."
In recent years, the importance of the world's forests as carbon sinks has featured prominently in global climate policy discussions.
An initiative called Reducing Emissions from Deforestation and Degradation (Redd), which is likely to involve developed nations paying tropical forest-rich nations not to cut down trees, appears to be gaining support.
Mr Nair gave the scheme a cautious welcome: "In theory, it is an excellent idea but its implementation is going to be extremely tricky.
"If you look at the people involved in forest clearing, it is different people in different regions.
"For example, in Latin America, it is largely cattle rangers and soya bean planters. In South-East Asia, it is palm oil and rubber plantations.
"What we find is that it is not the smallholders, it is the big players who are working within a global market.
"So far, only the issue of what it is trying to achieve has been examined, the issue of how we are going to implement it has not really been discussed or examined."
FAO launches latest report on the State of the World’s Forests 2009
FAO website 16 Mar 09;
16 March 2009, Rome – The dual challenges of economic turmoil and climate change are bringing the management of forests to the forefront of global interest. The need to reform forestry institutions and increase investments in science and technology are key to the better management of forests, notes the State of the World’s Forests 2009 launched today.
A highly mixed situation is expected, with gains in forest area in some regions and losses in others, notes the report. Countries in the early stages of development in particular tend to struggle with immense pressures on their forests. The trade-offs between immediate economic compulsions and long term benefits are challenging. Institutional weaknesses remain the most important problem, but also the most difficult to solve.
“Adapting forestry institutions to rapid changes in the larger environment is a major challenge”, says Jan Heino, Assistant Director-General of FAO’s Forestry Department. Of particular importance is the need to re-invent public sector forestry agencies that have been slow in adapting to changing customer needs, said Mr. Heino.
Global demand for products and environmental services is expected to increase in the coming decades, notes the report. Energy and climate change policies are increasing the use of wood as a source of energy, although this trend may be affected by the recent economic down-turn.
Effect of global economic crisis
In the short term forests and forestry are greatly impacted by the global economic crisis, notes the report. Reduced demand for wood and wood products as a result of the collapse in the housing sector and the credit crunch are having a severe negative impact on investments in industries and also on forest management.
A general concern is that some governments may dilute previously ambitious green goals or defer key policy decisions related to climate change mitigation and adaptation as they focus on reversing the economic downturn, the report said. Initiatives such as those for reducing emissions from deforestation and forest degradation that are dependent on international financial transfers could also face problems.
Furthermore, contraction of formal economic sectors often opens opportunities for expansion of the informal sector and could lead to more illegal logging.
Green path to development
But there are also opportunities stemming from the current crisis. Increased attention on “green development” could provide a new direction to the development of the forest sector. Planting trees, increased investments in sustainable forest management, and active promotion of wood in green building practices and renewable energy will all become integral parts of “green development,” notes the report.
Regional disparities
Forest resources in Europe are expected to continue to expand in view of declining land dependence, increasing income, concern for protection of the environment and well developed policy and institutional frameworks. Europe accounts for about 17 percent of global land area but has one-quarter of the world’s forest resources, approximately 1 billion hectares, of which 81 percent is in the Russian Federation. I
In South America, the pace of deforestation is unlikely to decline in the near future, despite low population density. High food and fuel prices will favour continued forest clearance for production of livestock and agricultural crops for food, feed and biofuel.
In Africa, forest loss is likely to continue at current rates. The growing demand for, and rising price of, food and energy will exacerbate the situation, especially as increased investments in infrastructure open up new areas. Increasing frequency of droughts, declining water supplies and floods strain coping mechanisms at the local and national levels and undermine efforts to manage African forests sustainably.
In Asia and the Pacific, home to more than half of the world’s population with some of the most densely populated countries in the world, demand for wood and wood products is expected to continue to increase in line with the growth in population and income.
Growth in the demand for primary commodities owing to rapid industrialization of emerging economies is likely to result in forest conversion in other countries within and outside the region. While the region is a leader in planted forests, it will continue to depend on wood from other regions, as land and water constraints will limit the scope for self-sufficiency in wood and wood products.
The near future of forestry in North America will depend on how quickly the region reverses the recent economic downturn and its impact on the demand for wood and wood products, especially in the United States of America, noted the report. The forest sector will also need to address challenges of climate change, including increasing frequency and severity of forest fires and damage by invasive pest species.
