The biggest impact of the EUTR on the UK trade to date has come from its requirement for a more formalised, systematic approach to buying timber.
Companies not only need to ask numerous questions on provenance, many of which were already common practice, they must also now ensure they are recording and validating supplier responses with credible evidence.
The key challenge for traders, however, is assessing what is and what is not a credible source of supply. After all, the trade’s main role is to buy and sell "good wood", not to be a forest governance specialist.
This is where membership of the TTF and access to our due diligence system (DD) and toolbox, the Responsible Purchasing Policy (RPP), has real commercial value. Our role is to monitor the various forest governance and legality assurance systems by engaging with stakeholders, from NGOs, to forestry/timber trade departments of key exporting countries, and transmit the key messages to members.
And this EUTR administrative challenge has not just dropped on the buyer’s desk. It has also impacted sales teams in the form of more requests for full information and transparency on timber origin and source. Such requests from ‘traders’ have eased as they have realised this is not an EUTR requirement. The TTF has played a role here, engaging with timber users and educating them about what the EUTR demands.
The TTF also strongly influenced last November’s EUTR guidance update to define the term ‘first placer’ more clearly. This clarification, that first placers are identified as the declared importer in customs entries, has given businesses that are both importers and agents flexibility on providing supplier information and enabled them to manage the risk of customers going direct.
The EUTR has also influenced the types and volumes of timber products offered in the UK market, and how they are purchased and promoted. Latest TTF statistics show a cumulative increase in timber imports between January-October 2012 and 2013, but a significant fall in hardwood imports, especially direct from tropical countries.
This does not mean tropical imports are down per se, as imports of hardwood are up from European countries with strong tropical ties. This suggests the UK trade is managing its EUTR risk by buying timber already placed elsewhere in Europe. It’s a trend the TTF will analyse, to manage the possibility of illegal timber coming ‘through a possible weak link’.
Another post-EUTR trend has seen hardwood plywood imports from Asia falling by 7% and from Central and South America by 22%, against an overall UK plywood import increase of around 4% – although how much of this is down to the EUTR is still unclear. We are also seeing risk mitigation actions on imports from these areas, with greater use of certified tropical timber and engineered poplar for replacing red plywood faces.
The TTF’s attention now is turning increasingly to working with the UK Competent Authority, the NMO, and the EC to ensure the EUTR is uniformly implemented across Europe. In this respect, we’re pressing for publicly available key performance indicators for all Competent Authorities.
And at the 2015 EUTR Review we must ensure too that the list of timber products annexed is expanded. We will also challenge the EC to view the Regulation as a model for legality due diligence in other material sectors.
We presume that there will be pressure on the EC to raise the EUTR bar from legality to sustainability principles. This may be a laudable long-term aim, but we’d oppose it now because of the lack of a clear set of agreed sustainability principles and practical ways of verifying to such standards without significant cost. Only once timber traders are settled into implementing the requirements of the EUTR based on legality principles and these latter issues are resolved, could this be explored.
