KUCHING: Malaysia is the top supplier of tropical hardwood plywood to Japan, which has reported a strong recovery in imports to near pre-Covid-19 level.

       Last year, Japan raised imports of hardwood plywood to more than 1.85 million cubic metres (cu m), up 12% or 204,600 cu m from about 1.65 million cu m recorded in 2020. Last year’s shipment by Japan was only 28,500 cu m shy of 2019’s imports of 1.88 million cu m.

       Besides Malaysia and Indonesia, Japan also bought hardwood plywood from Vietnam and China.

       The higher imports by Japan has driven up the prices of export plywood from Malaysia, with one of the key suppliers, Ta Ann Holdings Bhd reporting that its average selling price of plywood in the fourth quarter of 2021 had climbed 44% from the corresponding period in 2020.

       Ta Ann exported 88% of its plywood products to Japan in 2020 and 2019.

       In 2021, Malaysia also shipped 794,800 cu m of panel products to Japan, accounting for 43% of the latter’s total imports of hardwood plywood.

       This was an increase of 92,100 cu m or about 11.5% over the 702,700 cu m recorded in 2020, according to Japan Finance Ministry data quoted by the International Tropical Timber Organisation (ITTO) in its latest tropical timber report.

       Malaysia re-emerged as the No. 1 supplier of hardwood plywood to Japan last year after it was locked in a tie with rival Indonesia, which also exported 702,700 cu m to Japan in 2020.

       Indonesia exported 714,900 cu m or about 38.5% of Japan’s total imports in 2021, losing to Malaysia by 79,900 cu m.

       In 2019, Malaysia was a dominant supplier to Japan with sales of 852,300 cu m against Indonesia’s 767,600 cu m.

       Vietnam has significantly increased its hardwood plywood market share in Japan to 207,100 cu m last year from 130,000 cu m in 2019.

       China’s shipments to Japan also rose to 135,800 cu m last year from 131.200 cu m in 2019.

       “In the last quarter of 2021, Japan’s imports of plywood had risen sharply, as the country experienced a surge in demand for plywood and was unable to meet this demand from milling domestic logs.

       “Year-on-year, the December 2021 volume of imports of plywood jumped 30% but there was little change in the volume of imports compared to November.

       “Indonesia and Malaysia dominate the supply of plywood to Japan and in December, shipments from Indonesia rose (to 76,500 cu m) compared to a month earlier (66,000 cu m) but shipments from Malaysia dropped (to 51,200 cu m from 60,600 cu m in November).

       “In the last months of 2021, the volume of Japan’s plywood imports had clawed back to the levels seen in 2019.

       “The year 2020 was dismal,” said the ITTO report.

       According to Japan Lumber Report (JLR), although the volume of imported plywood rose by about 19% in 2021 over that of 2020, the Japanese were anxious about inadequate supply in the market.

       The trade journal, which is published twice a month, said the supply of South Sea (tropical) logs in Japan remained low and lumbering companies faced difficulties in their production activities due to a delay in supply caused by the shortage of containers to ship the logs to Japan and inadequate trucks to transport the logs.

       JLR said as Malaysia and Papua New Guinea were in the rainy season, the volume of log shipment was low and it was not easy to book vessels to transport the logs, as the demand in Japan was not much.

       “Some Japanese lumbering companies try to buy South Sea logs from Taiwan but the importing costs are high,” it added.

       Taiwan is the second-largest buyer of Sarawak logs, which paid about RM38mil (free on board value) for importing 40,339 cu m from Sarawak in 2021, according to Sarawak Timber Industry Development Corp (STIDC) export figures.

       Last year, Japan imported 15,158 cu m of logs for RM15.8mil from Sarawak, which sold the bulk of its logs to India (506,582 cu m for RM448.5mil).

       In 2021, Ta Ann and WTK Holdings Bhd both increased their log production volumes from natural forersts.

       Ta Ann raised its log output by 9,923 cu m to 248,637 cu m from 237,814 cu m in 2020 while WTK recorded a 38% hike in log production to 198,016 cu m from 144,000 cu m.

       Jaya Tiasa Holdings Bhd, however, registered a sharp decline in log production to 137,731 cu m in 2021 from 192,262 cu m in 2020, according to its monthly production figures filed with Bursa Malaysia.

       JLR said although Sabah had lifted the ban on log exports imposed in May 2018 and allowed restricted timber export from natural forests from this year, Japanese importers are not keen to resume imports from Sabah. After Sabah stopped log exports, traditional Japanese importers turned to Papua New Guinea to source for supply.

       “Demand for South Sea hardwood logs in Japan would stay low all through this year,” predicted JLR, its publication of which is reproduced by ITTO.