Pulp industry suggested optimize planted pulpwood

EoF News / 24 November 2008

PEKANBARU (EoF News)-- Local forestry service head suggested PT Riau Andalan Pulp & Paper (RAPP or Riaupulp) to suspend its pulp production temporarily for 2-3 years to enable to fulfill the raw material supply exclusively from its pulpwood plantations.

The government’s grand scenario to terminate natural forest clearing as raw material for pulp production by 2009 would make impossible for the authority to issue new logging approval or licenses to the industry, said Edy Suriandi, head of Pelalawan District Forestry Service, recently, Riau Pos daily reported today (24/11/2008).

Besides, he said, the international community also pressured the Indonesian Government to hold logging moratorium and conduct restoration which inevitably would not pave the way to pulp industry to clear natural forest recently.

Edi Suriandi met the management of Riaupulp (a subsidiary of Asia Pacific Resources International Holdings Limited/APRIL) last week, the daily reported. RAPP announced last week that it has suspended 1,000 workers due to worsening financial crisis and its claim of raw material shortage.

He said that if RAPP is persistent to produce pulp at range of 6,000-7,000 tons daily, the company should stop producing pulp for 2-3 years, while it waits the harvest of plantations coming up.

RAPP told media that it could only produce pulp to 2,000 tons daily recently due to the shortage of raw material from natural forest.

Alternately, Edy Suriandi suggested the company to urge the Minister of Forestry to revoke regulations prohibiting forest clearing in natural forest for pulp production.

Following the announcement made last week by PT RAPP to lay off 1,000 employees, some reactions followed the decision. Due to global financial crisis and shortage of raw material for pulp production, RAPP decided to suspend its 1,000 employees, said Rudi Fajar, the executive director last week in Pekanbaru (Koran Tempo, 21/11/2008).

Meanwhile, Minister of Industry and Trade, Fahmi Idris, said last week that the government could not help RAPP from further crisis due to the shortage of raw material as the administration has made effort previously by setting up a specific team to tackle Riau illegal logging discrepancies.

“The problem is on raw material crisis. We cannot help this,” Fahmi Idris told Riau Terkini website (22/11/2008).

Bargaining position

Riau Pos reported last weekend (22/11/2008) that the lay-off execution by RAPP is not as scary as people might think, as some of suspended employees looked happy to receive the compensation fee.

“I don’t know why, maybe they have got jobs from outside places. Or, perhaps the lay off process in Riaupulp follows the regulation,” said Hamdani, coordinator of Riaupulp Union who accompanied the laid off workers.

Hariansyah Usman, deputy coordinator of Jikalahari, suggested the pulp industry should optimize its concessions of pulpwood plantation rather than expecting the government to allow clearing more natural forest to supply the pulp industry, Tribun Pekanbaru reported (23/11/2008). “The government would not legalize illegal logging practice,” he said.

Johny Mundung, director executive of Walhi Riau, told the daily that the complaint uttered by RAPP  facing a shortage of raw material is a trick to keep up its bargaining position to the government to allow more natural forest clearing.