ITTO’s origins can be traced back to 1976 when the long series of negotiations that led to the first International Tropical Timber Agreement (ITTA) began at the fourth session of the United Nations Conference on Trade and Development (UNCTAD) as part of that organization’s Programme for Commodities. The eventual outcome of these negotiations was the ITTA, 1983, which governed the Organization’s work until 31 December 1996, when it was superseded by the ITTA, 1994. Negotiations for a successor to this agreement were recently concluded, again under the auspices of UNCTAD. The ITTA, 2006 is expected to come into force in 2008.

As the first ITTA was being negotiated in the early 1980s, concern over the fate of tropical forests was increasing and the international community was being asked to take action. By then, conservation had become at least as important a consideration in the negotiations as trade. This was reflected in the preamble to the Agreement, in which conservation and trade were accorded equal importance. The creators of the Agreement believed that a flourishing trade in tropical timber, if based on a well-managed forest resource, could be a key to sustainable development, providing valuable foreign exchange and employment while protecting natural forests from destruction, degradation and excision.

The ITTA that eventually came into operation was no conventional commodity agreement. It was, in reality, as much an agreement for forest conservation and development as for trade. In effect, it preceded the concerns which featured in the 1987 Brundtland Report and at the Earth Summit in 1992 and its trade components were as much instruments for tropical forest conservation as ends in themselves.

The ITTA, 2006 builds on the foundations of the previous agreements, focusing on the world tropical timber economy and the sustainable management of the resource base, simultaneously encouraging the timber trade and the improved management of the forests. In addition, it contains provisions for information sharing, including non-tropical timber trade data, and allows for the consideration of non-tropical timber issues as they relate to tropical timber.

A unique organization

ITTO occupies an unusual position in the family of intergovernmental organizations.
Like all commodity organizations it is concerned with trade and industry, but like an environmental agreement it also pays considerable attention to the sustainable management of natural resources. It manages its own program of projects and other activities, enabling it to quickly test and operationalize its policy work. Other features include:

• an equal partnership in decision-making, policy formulation and project development between producing members (tropical developing countries) and tropical timber consuming members (mostly temperate developed countries);
• the active participation of civil society and trade organizations in meetings and project work;
• the formulation and implementation of projects in producing member countries, using mostly local expertise;
• frequent meetings of its governing body (the International Tropical Timber Council), meaning a comparatively rapid pace of debate, decisions and action.

What ITTO does

ITTO develops internationally agreed policy documents to promote sustainable forest management and forest conservation and assists tropical member countries to adapt such policies to local circumstances and to implement them in the field through projects. In addition, ITTO collects, analyses and disseminates data on the production and trade of tropical timber and funds a range of projects and other action aimed at developing industries at both community and industrial scales. For more information on ITTO’s action program go to ITTO at work, or see the Organization’s Biennial Work Programme for 2006–07.

Members may submit project proposals to the Council for review and financing in accordance with the ITTO project cycle. Examples include pilot and demonstration projects, human resource development projects, and research and development projects; the Yokohama Action Plan sets out the types of activities that the Organization should undertake in project and policy work. All projects are funded by voluntary contributions, mostly from consuming member countries. Since it became operational in 1987, ITTO has funded more than 700 projects, pre-projects and activities valued at more than US$280 million. The major donors are the governments of Japan, Switzerland and the USA.

ITTO’s structure

The governing body of the ITTO is the International Tropical Timber Council, which is composed of all the Organization’s members.
ITTO has two categories of membership: producing and consuming. Annual contributions and votes are distributed equally between these two groups, which are called caucuses. Within each caucus, the dues and votes of individual members are calculated based on tropical timber trade and, in the case of producers, also on the extent of tropical forests within the country.

The Council is supported by four committees, which are open to all members and observers and provide advice and assistance to the Council on policy and project issues. Three of the committees deal with key areas of policy and project work: economic information and market intelligence; reforestation and forest management; and forest industry. These committees are supported by the Expert Panel for the Technical Appraisal of Projects and Pre-projects, which reviews project proposals for technical merit and relevance to ITTO objectives. The fourth committee, on Finance and Administration, advises the Council on matters related to the budget and other funding and administrative issues concerning the management of the Organization. ITTO’s organizational structure is shown graphically in the Yokohama Action Plan (which has been extended to the end of 2007).

Non-member stakeholders have established two advisory groups to facilitate their participation in the Council and to provide input to the Council’s decision-making process. These are the Trade Advisory Group (TAG) and the Civil Society Advisory Group (CSAG).

ITTO’s small secretariat of about 35 staff is based in Yokohama, Japan. It is headed by an Executive Director, who is responsible to the Council for the administration and operation of the Agreement in accordance with decisions made by the Council. The Organization also has regional officers in Latin America and Africa to assist with project monitoring and other duties.

Prices for Southeast Asian timber products rose sharply across the board after severe thunderstorms struck several production areas and floods forced evacuations. An assessment of damages to the timber industry is underway. Meanwhile, Indonesia and the EU agreed to start formal talks towards a voluntary partnership agreement (VPA) to ensure that only legal timber enters the region.

Brazilian exports of furniture declined an estimated 5% in 2006. Brazil attained the world’s largest FSC-certified tropical area. An ITTO study shows that Asia-Pacific has 80% of the world’s tropical forest plantations but 55% of the production of solid-wood products from these forests comes from Latin America & the Caribbean.

Exports of tropical logs and plywood to Japan surged, boosted by rising prices. Chinese plywood continues to rapidly gain market share in Europe at the expense of tropical plywood. However, the European Commission is investigating whether to extend the EU anti-dumping duties from okoume-poplar to other Chinese plywood. Chinese plywood is about 25-40% cheaper than tropical products. If approved, the duties could bring price parity between the products. The Central Point of Expertise on Timber (CPET) renewed the acceptance of five certification schemes for UK public timber procurement but ENGOs, supporters of FSC, criticized the decision. A government initiative to build only carbon-neutral homes by 2016 could be a boost for the UK timber industry. US demand for lumber is being severely affected by the ongoing correction in the housing sector.

Sapele prices reach unexpected high levels

New log quota system enters into force in Gabon

Gabon submits scheme for PEFC endorsement

FDA prepares new bidding process for concessions

Unprecedented flooding sends Southeast Asian prices sharply up

EU delegation visits blockade sites in Baram, Malaysia

AHEC says Malaysian industry cannot live on rubberwood alone

Indonesia and EU kick off formal VPA talks

Indonesian export prices edge up amid storms and police control

Brazilian furniture exports retreat in 2006

Amapá forest protection areas reach record levels

FSC certifies world’s largest tropical forest area

Indonesian lumber continues to lose ground in Japan

Japanese imports of plywood recover

China imposes anti-dumping tariffs on overlays

Pizhou is China’s leading panel production base

Dutch demand for plywood rises amid limited supply

China becomes Germany’s largest plywood supplier

Chinese plywood faces anti-dumping duties in EU

CPET renews acceptance of certification schemes

ENGOs slam CPET on renewal decision

UK house prices to remain bullish in the short term

Zero-carbon homes could boost UK timber industry

US housing starts recover slightly

Slumping housing market subdues lumber demand

Home Depot requires new emission standard for plywood

MIS Coordinator mis@itto.or.jp