The South African Forestry and Forest Products Industry 2009 Produced By Roger Godsmark Forestry South Africa, September 2010

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

Section 1 Introduction

Land Use in South Africa Total RSA land area – 122.3 million ha

Total Mpum. land area – 8.2 million ha (6.7% of total) Land Use in Mpumalanga 519 817 ha Total Mpum. land area – 8.2 million ha (6.7% of total)

Land Use in KwaZulu Natal 504 393 ha Total KZN land area – 9.1 million ha (7.5% of total)

Land Use in the Eastern Cape 141 819 ha Total E. Cape land area – 17.1 million ha (13.9% of total)

Land Use in the Western Cape 59 171 ha Total W. Cape land area – 12.9 million ha (10.6% of total)

Total Limpopo land area – 12.0 million ha (9.8% of total) Land Use in Limpopo 49 668 ha Total Limpopo land area – 12.0 million ha (9.8% of total)

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

Drop in Forestry Area – 127 000 ha (9.1%) Land Use Comparisons 1999, 2004 & 2009 Drop in Forestry Area – 127 000 ha (9.1%)

Plantation Area Comparisons 2009

Section 2 The Forestry Industry

Plantation Area by Species 2009 Total – 1 274 869 ha

Plantation Area by Ownership 2009 Total – 1 274 869 ha

Plantation Area by Province 2009 Total – 1 274 869 ha

Plantation Area by Province and Genera 2009 Total – 650 024 ha (softwood) Total – 624 845 ha (hardwood)

Planted Area Comparisons by Region & Species 2009

Pine Plantation Area by Region 2009 Total – 650 024 ha (51.0% of total)

Eucalyptus Plantation Area by Region 2009 Total – 515 324 ha (40.4% of total)

Wattle Plantation Area by Region 2009 Total – 104 055 ha (8.2% of total)

Other Hardwood Plantation Area by Region 2009 Total – 5 467 ha (0.4% of total)

Plantation Area by Management Objectives 2009 Total – 1 274 869 ha

Softwood Plantation Area by Management Objectives 2009 Total – 650 024 ha

Hardwood Plantation Area by Management Objectives 2009 Total – 624 845 ha

Plantation Area by Province and Ownership 2009 Leased Safcol packages included in “Private” KLF included in “Public” Total Private – 1 058 908 ha (83.1%) Total Public – 215 961 ha (16.9%)

Percentage Plantation Ownership by Province 2009 Total Private – 1 058 908 ha (83.1%) Total Public – 215 961 ha (16.9%)

Plantation Area by Species and Ownership 2009 Total Private – 1 058 908 ha (83.1%) Total Public – 215 961 ha (16.9%)

Percentage Plantation Ownership by Species 2009 Total Private – 1 058 908 ha (83.1%) Total Public – 215 961 ha (16.9%)

Planted Area Comparisons by Region & Product 2009

Roundwood Production by Product 2009 Total – 7.7 million m3 (softwood) Total – 11.2 million m3 (hardwood)

Roundwood Production by Province and Genera 2009 Total – 7.7 million m3 (softwood) Total – 11.2 million m3 (hardwood)

Roundwood Production by Province and Genera 2009 9.537 6.671 1.727 0.584 0.368 Total – 7.7 million m3 (softwood) Total – 11.2 million m3 (hardwood)

Roundwood Production ex Plantations by Province & Product 2009 Total – 18.9 million m3 or 16.2 million tons

Roundwood Production ex Plantations by Province & Product 2009 Total – 18.9 million m3 or 16.2 million tons

Total Roundwood Production ex Plantations by Province 2009 Total – 18.9 million m3 or 16.2 million tons

Total Roundwood Production ex Plantations by Product 2008 Total – 18.9 million m3 or 16.2 million tons

Softwood Roundwood Production ex Plantations by Product 2009 Total – 7.7 million m3 or 7.9 million tons

Hardwood Roundwood Production ex Plantations by Product 2009 Total – 11.2 million m3 or 8.3 million tons

Total Roundwood Production ex Plantations by Species 2009 Total – 18.9 million m3 or 16.2 million tons

Composition of Roundwood Production by Product 2009

Total Plantation Area 1980 to 2009 Total increase in afforested area over period : 113 463 ha Total % increase in afforested area over period : 9.8%

Total Roundwood Production ex Plantations 1980 to 2009 Total increase in production over period : 59.0% Total in increase in afforested area over period : 9.8%

Roundwood Production vs. Plantation Area 1980 to 2009 Total increase in production over period : 59.0% Total in increase in afforested area over period : 9.8%

Average Productivity per Hectare 1980 - 2009 Total increase in productivity over period – 4.6 m3 per ha p.a. (45%)

Production Comparisons 1999, 2004 & 2009

Value of Roundwood Production 2009 Total – R6.7 billion

Value of Roundwood Production ex Plantations by Product 2009 Total – R6 705 million

Value of Roundwood Production ex Plantations by Province 2009 Total – R6 705 million

Value of Roundwood Production ex Plantations by Province & Product 2009 Total – R6 705 million

Value of Roundwood Production ex Plantations by Province & Product 2009 Total – R6 705 million

Value of Roundwood Production 1980 to 2009 Nominal increase over period : R6.5 bn (3 971%) Real increase over period : R4.0 bn (148%)

New Afforestation by Region 1980 to 2009 AVERAGE New afforestation over period - 382 619 ha Average per year - 12 754 ha

Total New Afforestation by Region 1980 to 2009 Total – 382 619 ha

Total New Afforestation by Region 10 Yr Period - 2000 to 2009 Total – 42 336 ha

New Afforestation by Region 10 Year Period – 2000 to 2009 AVERAGE New afforestation over period - 39 614 ha Average per year - 3 961 ha

New Afforestation by Province 2009 Total – 2 169 ha

New Afforestation by Species 1980 to 2009 Average p.a. 1980 to 1985 - 10 974 ha (17.2% of total) Average p.a. 1986 to 1990 - 24 558 ha (32.1% of total) Average p.a. 1991 to 1995 - 24 406 ha (31.9% of total)

Total New Afforestation by Species 1980 to 2009 Total – 382 619 ha

New Afforestation by Species 2009 Total – 2 169 ha

New Afforestation by Product 1980 to 2009 Average p.a. 1996 to 2000 - 7 019 ha (9.2% of total) Average p.a. 2001 to 2005 - 5 044 ha (6.6% of total) Average p.a. 2006 to 2009 - 2 910 ha (3.0% of total)

Total New Afforestation by Product 1980 to 2009 Total – 382 619 ha

New Afforestation by Product 2009 Total – 2 169 ha

Area Converted Out of Timber Production by Species 1980 to 2009 Area converted over period - 89 390 ha Average p.a. - 2 980 ha

Total Area Converted out of Timber Production by Species 1980 to 2009 Total – 89 390 ha

Total Area Converted out of Timber Production by Species 2009 Total – 3 554 ha

Net New Afforestation by Species 1980 to 2009 Net new afforestation over period - 293 229 ha Average p.a. - 9 774 ha

Net New Afforestation by Species 1980 to 2009 Total – 293 229 ha

Net New Afforestation by Species 2009 Total net new afforestation - Minus 1 385 ha

Area Converted Out of Timber Production by Region 1980 to 2009 Area converted over period - 89 390 ha Average p.a. - 2 980 ha

Total Area Converted out of Timber Production by Region 1980 to 2009 Total – 89 390 ha

Net New Afforestation by Region 1980 to 2009 Net new afforestation over period - 293 229 ha Average p.a. - 9 774 ha

Net New Afforestation by Region 1980 to 2009 Total – 293 229 ha

Conversion of Plantations out of Production & to Other Species 1980 to 2009 Net loss to production area over period - 89 390 ha Average p.a. - 2 980 ha

Total Area Converted out of Production & to Other Species 1980 to 2009 Net loss to production area over period - 89 390 ha Average p.a. - 2 980 ha

Area Converted out of Production & to Other Species 2009 Net loss to production area - 3 554 ha

Net Addition to Planted Area by Species 1980 to 2009 Total net addition to production area - 293 229 ha Average p.a. - 9 774 ha

Total Net Addition to Planted Area by Species 1980 to 2009 Total net addition to production area - 293 229 ha Average p.a. - 9 774 ha

Net Addition (Loss) to Planted Area by Species 2009 Total net gain in production area Minus 1 385 ha

Damage to Plantations by Genera 1980 to 2009 Total area damaged over period - 930 573 ha Average p.a. - 31 019 ha

Damage to Plantations by Fires 1980 to 2009 Total area damaged over period - 930 573 ha Total area damaged by fire - 548 568 ha (59%) Total area damaged by other causes - 382 005 ha (41%)

Damage to Plantations by Fires 1980 to 2009

Damage to Plantations by Genera 2009 Total – 22 808 ha (1.8% of total planted area)

Damage to Plantations by Cause 2009 Total – 22 808 ha

Damage to Plantations by Fire 2009 Total – 19 805 ha

FSC Certified Forests by Forest Type: August 2009 Certified Area – 1 572 568 ha (incl. planted & non-planted areas)

FSC Certified Forests by Ownership: August 2009 Certified Area – 1 572 568 ha (incl. planted & non-planted areas)

The Forest Products Industry Section 3 The Forest Products Industry

Number of Processing Plants by Type 2009 Total number of plants: 192

Intake of Roundwood into Processing Plants 1980 to 2009 Total increase in intake over period - 7.4 million m3 (67%) Biggest increase that of pulpwood - 8.7 million m3 (206%)

Intake of Roundwood into Processing Plants 2009 Total – 18.5 million m3

Roundwood Intake into Processing Plants by Province & Product 2009 Total – 18.5 million m3

Roundwood Intake into Processing Plants by Province & Product 2009 Total – 18.5 million m3

Average Size of Plant by Intake 1980 vs. 2009 Overall average intake has increased by: - 109% Average intake of PP & Board Mills has increased by: - 130% Only average intake of MT Mills has declined – by - 35%

Sales of Certain Products from Processing Plants 1980 to 2009 Biggest increase that of chips - 3.5 million tons (652%) Only decrease that of mining timber - 1.2 million tons (-72%)

Value of Sales from Primary Processing Plants 2009 Total – R20.4 billion

Value of Sales from Primary Processing Plants 2009 Total – R20.4 billion

Value of Sales from Primary Processing Plants 2009 Total – R20.4 billion

Value of Sales from Primary Processing Plants 1980 to 2009 Nominal increase over period - R19.7 bn (2 823%) Real increase over period - R8.9 bn (78%)

Value of Roundwood Sales from Processing Plants by Product & Province 2009 Total – R20.4 billion

Value of Roundwood Sales from Processing Plants by Product & Province 2009 Total – R20.4 billion

Gross Value of Output Comparisons 1999, 2004 & 2009

Gross Value of Output Comparisons per Planted Hectare 1999, 2004 & 2009

Value Addition in Primary Processing Industry 2009 Note : excludes secondary processing (e.g. paper manufacturing)

Value Addition Comparisons in Primary Processing Industry 2009 Note : Based only on input value of raw fibre (i.e. excludes all other input costs)

Contribution to Employment Section 4 Contribution to Employment

Forest Sector Employment – RSA 2009 Sub-sector No. of employees Total Employment Direct Indirect Forestry 66,500 30,000 96,500 Pulp and Paper 13,200 10,800 24,000 Sawmilling 20,000 10,000 Timber Board 6,000 n/a Mining Timber 2,200 Other 11,000 Total 118,900 50,800 169,700

Direct Employment in Forestry Industry by Province 2009 Total – 66 500

Direct Employment in Forestry Industry by Region 2009 Total estimated direct jobs in Industry – 66 500

Direct Employment in Forestry Industry as % of Those Employed in 2009 Total employed in RSA – 13.4 million

Indirect Employment in Forestry Industry by Province 2009 Total estimated indirect jobs created by Industry – 371 000

Total employed in Mpumalanga – 897 000 Indirect Employment in Forestry Industry as % of Those Employed in 2009 Total employed in Mpumalanga – 897 000

Direct & Indirect Jobs in Forestry Industry by Province 2009 Estimated total – 437 400 jobs

Total employed in Mpumalanga – 897 000 Total Employment in Industry as % of Those Employed in Formal Sector 2009 Total employed in Mpumalanga – 897 000

Dependents of Those Working in Forestry Industry by Region 2009 53 000 Estimated total – 1.4 million dependents

Total Number of People Dependent on Forestry Industry by Region 2009 Estimated total – 1.8 million livelihoods

Estimated % of Population Dependent on Forestry Industry 2009

Section 5 Investment in Sector

Investment in RSA Forestry Industry 2009 Total Investment - R24.8 Billion

Investment in RSA Forestry Industry 2009 Total Investment - R24.8 Billion

Investment in RSA Forestry Industry 2009 Total Investment - R24.8 Billion

Investment in Plantations – By Province 2009 Mpumalanga has highest investment - 42% of total

Investment in Mpumalanga Forestry 2009 Total Investment - R10.3 Billion

Investment in KZN Forestry 2009 Total Investment - R9.1 Billion

Investment in E. Cape Forestry 2009 Total Investment - R2.9 Billion

Investment in W. Cape Forestry 2009 Total Investment - R1.3 Billion

Investment in Limpopo Forestry 2009 Total Investment - R1.1 Billion

Investment in Forest Products Sector by Type of Processing Plant 2009 Total Book Value of Investments - R15.7 Billion

Investment in Forest Products Sector by Investment Category 2009 Total Book Value of Investments - R15.7 Billion

Section 6 Contribution to GDP

Total GDP – R2 284 Billion (i.e. R2.3 Trillion) Composition of RSA GDP 2009 Total GDP – R2 284 Billion (i.e. R2.3 Trillion)

Contribution to GDP 1980 to 2009 Increase in Forestry GDP over period from 4.5% to 9.7% Decrease in For. Prod. GDP over period from 6.3% to 6.1%

Forestry vs. Other Agricultural GGP per Region 2009 Forestry in Mpumalanga of major importance

Forest Products vs. Other Manufacturing GGP per Region 2009

Gross Value of Output by Sector & Province 2009

Gross Value of Output by Sector & Province 2009

Forest Industry Contribution to Total GGP per Region - 2009

Forest Industry Contribution to Total GGP per Region - 2009

Contribution to Foreign Trade Section 7 Contribution to Foreign Trade

Imports vs. Exports of Forest Products 2009 Positive trade balance in 2009 = R2.91 billion

Forest Product Exports 2009 Total – R12.5 billion

Forest Product Imports 2009 Total – R9.6 billion

Trade Balance in Forest Products 1992 to 2009 (nominal) Increase in imports - R8.1 billion (574%) Increase in exports - R10.1 billion (432%) Increase in trade balance - R2.0 billion (214%)

Trade Balance in Forest Products 1992 to 2009 (real) Increase in imports - R5.2 billion (119%) Increase in exports - R5.3 billion (73%) Increase in trade balance - R0.1 billion (2%)

Export Comparisons 1999, 2004 & 2009