1. The South African Forestry and Forest Products Industry 2007 Roger Godsmark Produced by Forestry South Africa, August 2008

2. Presentation Outline Introduction The importance of the Forestry Industry The importance of the Forest Products Industry Industry Contribution to Employment Investment Industry Contribution to GDP Industry Contribution to Foreign Trade

3. Section 1 Introduction

4. Land Use in South Africa Total RSA land area – 122.3 million ha 1 266 196 ha

5. Land Use in Mpumalanga Total Mpum. land area – 8.2 million ha (6.7% of total) 514 956 ha

6. Land Use in KwaZulu Natal Total KZN land area – 9.1 million ha (7.5% of total) 486 967 ha

7. Land Use in the Eastern Cape Total E. Cape land area – 17.1 million ha (13.9% of total) 155 078 ha

8. Land Use in the Western Cape Total W. Cape land area – 12.9 million ha (10.6% of total) 61 097 ha

9. Land Use in Limpopo Total Limpopo land area – 12.0 million ha (9.8% of total). 48 096 ha

10. Plantation Area as % of Land Area by Province Forestry in Mpumalanga greatest % of land area

11. Land Use Comparisons in RSA 1996, 2001 & 2007 Drop in Forestry Area – 221 000 ha (14.9%)

12. Section 2 The Forestry Industry

13. Plantation Area by Species 2007 Total – 1 266 194 ha

14. Plantation Area by Ownership 2007 Total – 1 266 194 ha

15. Plantation Area by Province 2007 Total – 1 266 194 ha

16. Plantation Area by Province and Genera 2007 Total – 677 079 ha (softwood) Total – 589 115 ha (hardwood)

17. Planted Area Comparisons by Region & Species 2007

18. Pine Plantation Area by Region 2007 Total – 677 079 ha (53.5% of total)

19. Eucalyptus Plantation Area by Region 2007 Total – 477 703 ha (37.7% of total)

20. Wattle Plantation Area by Region 2007 Total – 102 980 ha (8.1% of total)

21. Other Hardwood Plantation Area by Region 2007 Total – 8 432 ha (0.7% of total)

22. Plantation Area by Management Objectives 2007 Total – 1 266 194 ha

23. Softwood Plantation Area by Management Objectives 2007 Total – 677 079 ha

24. Hardwood Plantation Area by Management Objectives 2007 Total – 589 118 ha

25. Plantation Area by Province and Ownership 2007 Total Private – 1 051 223 ha (83%) Total Public – 214 971 ha (17%) Leased Safcol packages included in “Private”

26. Percentage Plantation Ownership by Province 2007 Total Private – 1 051 223 ha (83%) Total Public – 214 971 ha (17%)

27. Plantation Area by Species and Ownership 2007 Total Private – 1 051 223 ha (83%) Total Public – 214 971 ha (17%)

28. Percentage Plantation Ownership by Species 2007 Total Private – 1 051 223 ha (83%) Total Public – 214 971 ha (17%)

29. Planted Area Comparisons by Region & Product 2007

30. Plantation Area by Ownership and Species 2007

31. Percentage Plantation Ownership by Species 2007

32. Roundwood Production by Province and Genera 2007 Total – 9.0 million m 3 (softwood) Total – 11.3 million m 3 (hardwood)

33. Roundwood Production by Province and Genera 2007 0.634 0.684 1.750 7.906 9.356 Total – 9.0 million m 3 (softwood) Total – 1.3 million m 3 (hardwood)

34. Total Roundwood Production ex Plantations by Province 2007 Total – 20.3 million m 3 or 17.8 million tons

35. Total Roundwood Production ex Plantations by Product 2007 Total – 20.3 million m 3 or 17.8 million tons

36. Softwood Roundwood Production ex Plantations by Product 2007 Total – 9.0 million m 3 or 9.3 million tons

37. Hardwood Roundwood Production ex Plantations by Product 2007 Total – 11.3 million m 3 or 8.4 million tons

38. Total Roundwood Production ex Plantations by Species 2007 Total – 20.3 million m 3 or 17.8 million tons

39. Composition of Roundwood Production by Product 2007

40. Total Roundwood Production ex Plantations 1980 to 2007 Total increase in production over period: 71.1% Total in increase in afforested area over period: 9.0%

41. Roundwood Production vs. Plantation Area 1980 to 2007 Total increase in production over period- 71.1% Total in increase in afforested area over period- 9.0%

42. Average Productivity per Hectare 1980 - 2007 Total increase in productivity over period – 5.8 m 3 per ha p.a. (57%)

43. Production Comparisons 1996, 2001 & 2007

44. Value of Roundwood Production 2007 Total – R5.2 billion

45. Value of Roundwood Production 1980 to 2007 Nominal increase over period: R5.0 bn (3 037%) Real increase over period: R2.9 bn (129%)

46. New Afforestation by Region 1980 to 2007 New afforestation over period- 375,811 ha Average per year- 13,422 ha AVERAGE

47. Total New Afforestation by Region 1980 to 2007 Total – 375 811 ha

48. New Afforestation by Region 10 Year Period – 1998 to 2007 New afforestation over period- 42 010 ha Average per year- 4 201 ha AVERAGE

49. Total New Afforestation by Region 10 Yr Period - 1998 to 2007 Total – 42 010 ha

50. New Afforestation by Province 2007 Total – 2,198 ha

51. New Afforestation by Species 1980 to 2007 Average p.a. 1980 to 1985- 10 974 ha (17.5% of total) Average p.a. 1986 to 1990- 24 558 ha (32.7% of total)

52. Total New Afforestation by Species 1980 to 2007 Total – 375 809 ha

53. New Afforestation by Species 2007 Total – 2 196ha

54. New Afforestation by Product 1980 to 2007 Average p.a. 1991 to 1995- 24 406 ha (32.5% of total) Average p.a. 1996 to 2000- 7 019 ha (9.3% of total) Average p.a. 2001 to 2007- 4 293 ha (8.0% of total)

55. Total New Afforestation by Product 1980 to 2007 Total – 375 809 ha

56. New Afforestation by Product 2007 Total – 2 198 ha

57. Area Converted Out of Timber Production by Species 1980 to 2007 Area converted over period- 85 140 ha Average p.a. - 3 041 ha

58. Total Area Converted out of Timber Production by Species 1980 to 2007 Total – 85 140 ha

59. Total Area Converted out of Timber Production by Species 2007 Total – 793 ha

60. Net New Afforestation by Species 1980 to 2007 Net new afforestation over period- 290 669 ha Average p.a. - 10 766 ha

61. Net New Afforestation by Species 1980 to 2007 Total – 290 669 ha

62. Net New Afforestation by Species 2007 Total net new afforestation - 1 403 ha

63. Area Converted Out of Timber Production by Region 1980 to 2007 Area converted over period- 85 140 ha Average p.a. - 3 041 ha

64. Total Area Converted out of Timber Production by Region 1980 to 2007 Total – 85 140 ha

65. Net New Afforestation by Region 1980 to 2007 Net new afforestation over period- 290 669 ha Average p.a. - 10 766 ha

66. Net New Afforestation by Region 1980 to 2007 Total – 290 669 ha

67. Conversion of Plantations out of Production & to Other Species 1980 to 2007 Net loss to production area over period- 85 140 ha Average p.a. - 3 041 ha

68. Total Area Converted out of Production & to Other Species 1980 to 2007 Net loss to production area over period- 85 140 ha Average p.a. - 3 041 ha

69. Area Converted out of Production & to Other Species 2007 Net loss to production area - 793 ha

70. Net Addition to Planted Area by Species 1980 to 2007 Total net addition to production area- 290 696 ha Average p.a. - 10 766 ha

71. Total Net Addition to Planted Area by Species 1980 to 2007 Total net addition to production area- 290 669 ha Average p.a. - 10 766 ha

72. Net Addition (Loss) to Planted Area by Species 2007 Total net gain in production area- 1403 ha

73. Damage to Plantations by Genera 1980 to 2007 Total area damaged over period- 830 615 ha Average p.a. - 29 665 ha

74. Damage to Plantations by Fires 1980 to 2007 Total area damaged over period- 830 615 ha Total area damaged by fire- 457 951 ha (55.1%) Total area damaged by other causes- 372 664 ha (44.9%)

75. Damage to Plantations by Fires 1980 to 2007

76. Damage to Plantations by Genera 2007 Total – 97 593 ha (7.7% of total planted area)

77. Damage to Plantations by Cause 2007 Total – 97 593 ha

78. Damage to Plantations by Fire 2007 Total – 70 697 ha

79. FSC Certified Forests by Forest Type: October 2007 Certified Area – 1 622 196 ha (incl. planted & non-planted areas)

80. FSC Certified Forests by Ownership: October 2007 Certified Area – 1 622 196 ha (incl. planted & non-planted areas)

81. Section 3 The Forest Products Industry

82. Number of Processing Plants by Type 2007 Total – 178 plants

83. Intake of Roundwood into Processing Plants 1980 to 2007 Total increase in intake over period- 8.7 million m 3 (78%) Biggest increase that of pulpwood- 9.7 million m 3 (229%)

84. Intake of Roundwood into Processing Plants 2007 Total – 19.8 million m 3

85. Average Size of Plant by Intake 1980 vs. 2007 Overall average intake has increased by: - 141% Average intake of PP & Board Mills has increased by: - 98% Only average intake of MT Mills has declined – by- 13%

86. Sales of Certain Products from Processing Plants 1980 to 2007 Biggest increase that of chips- 4.4 million tons (823%) Only decrease that of mining timber- 1.2 million tons (71%)

87. Value of Sales from Primary Processing Plants 2007 Total – R18.5 billion

88. Value of Sales from Primary Processing Plants 1980 to 2007 Nominal increase over period- R17.8 bn (2 549%) Real increase over period- R8.9 bn (93%)

89. Contribution to GDP 1980 to 2007 Increase in Forestry GDP over period from 4.5% to 9.1% Decrease in For. Prod. GDP over period from 6.3% to 5.7%

90. Gross Value of Output Comparisons 1996, 2001 & 2007

91. Gross Value of Output Comparisons per Planted Hectare 1996, 2001 & 2007

92. Value Addition in Primary Processing Industry 2007 Note : excludes secondary processing (e.g. paper manufacturing)

93. Value Addition Comparisons in Primary Processing Industry 2007 Note : Based only on input value of raw fibre (i.e. excludes all other input costs)

94. Section 4 Contribution to Employment

95. Forest Sector Employment – RSA 2007 Sub-sector No. of employees Total Employment DirectIndirect Forestry76,84430,000106,844 Pulp and Paper 13,20010,78123,981 Sawmilling20,000n/a20,000 Timber Board 6,000n/a6,000 Mining Timber 2,200n/a2,200 Other11,000n/a11,000 Total129,24440,781170,025

96. Direct Employment in Forestry Industry by Province 2007 Total – 77,000

97. Direct Employment in Forestry Industry by Region 2007 Total estimated direct jobs in Industry – 77,000

98. Direct Employment in Forestry Industry as % of Those Employed in 2007 Total employed in RSA – 12.5 million

99. Indirect Employment in Forestry Industry by Province 2007 Total estimated indirect jobs created by Industry – 462,000

100. Indirect Employment in Forestry Industry as % of Those Employed in 2007 Total employed in Mpumalanga – 803,000

101. Direct & Indirect Jobs in Forestry Industry by Province 2007 Estimated total – 539,400 jobs

102. Total Employment in Industry as % of Those Employed in Formal Sector 2007 Total employed in Mpumalanga – 0.8 million

103. Dependents of Those Working in Forestry Industry by Region 2007 Estimated total – 1.7 million dependents 59,000

104. Total Number of People Dependent on Forestry Industry by Region 2007 Estimated total – 2.3 million livelihoods

105. Estimated % of Population Dependent on Forestry Industry 2007

106. Section 5 Investment in Sector

107. Investment in RSA Forestry Industry 2007 Total Investment - R17.4 Billion

108. Investment in RSA Forestry Industry 2007 Total Investment - R17.4 Billion

109. Investment in RSA Forestry Industry 2007 Total Investment - R17.4 Billion

110. Investment in Plantations – By Province Mpumalanga has highest investment - 41.6% of total

111. Investment in Mpumalanga Forestry 2007 Total Investment - R7.2 Billion

112. Investment in KZN Forestry 2006 Total Investment - R5.9 Billion

113. Investment in E. Cape Forestry 2007 Total Investment - R2.5 Billion

114. Investment in W. Cape Forestry 2007 Total Investment - R1.1 Billion

115. Investment in Limpopo Forestry 2007 Total Investment - R745 Million

116. Investment in Forest Products Sector by Type of Processing Plant 2007 Total Book Value of Investments - R15.8 Billion

117. Investment in Forest Products Sector by Investment Category 2007 Total Book Value of Investments - R15.8 Billion

118. Section 6 Contribution to GDP

119. Composition of RSA GDP 2007 Total GDP – R1 727 Billion

120. Contribution to GDP 1980 to 2007 Increase in Forestry GDP over period from 4.5% to 9.1% Decrease in For. Prod. GDP over period from 6.3% to 5.7%

121. Forestry vs. Other Agricultural GGP per Region 2007 Forestry in Mpumalanga of major importance

122. Forest Products vs. Other Manufacturing GGP per Region 2007

123. Forest Industry Contribution to Total GGP per Region - 2007

125. Gross Value of Output Comparisons 1996, 2001 & 2007

126. Gross Value of Output Comparisons per Planted Hectare 1996, 2001 & 2007

127. Section 7 Contribution to Foreign Trade

128. Forest Product Exports 2007 Total – R12.2 billion

129. Forest Product Imports 2007 Total – R9.8 billion

130. Trade Balance in Forest Products 1980 to 2007 (nominal) Increase in imports- R8.3 billion (589%) Increase in exports- R9.8 billion (421%) Increase in trade balance- R1.5 billion (164%)

131. Trade Balance in Forest Products 1980 to 2007 (real) Increase in imports- R6.1 billion (168%) Increase in exports- R6.2 billion (103%) Increase in trade balance- R0.06 billion (3%)

132. Export Comparisons 1996, 2001 & 2007