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23rd of July 2018

Economy



Wood product prices soar as logging ban cuts supplies

Manufacture prices of wood and wood products rose sharply in the three months to June, revealing the effects of a nationwide logging ban to reverse fast depleting forest cover.

A quarterly Producer Price Index (PPI) by the Kenya National Bureau of Statistics (KNBS) showed that between March and June 2018, the producer prices of wood and affiliated products, except furniture, jumped 23 per cent to 155.82 from the previous quarter followed by manufacture of rubber and plastic products which climbed 4.3 per cent to 112.23. It is expected that these increases would drive up consumer prices.

The PPI measures the gross changes in the trading price on the domestic and non-domestic markets at all stages of processing.

The government earlier this year banned logging amid reports of widespread plunder of forest resources.

Kenya has a forest cover of about 7.8 per cent of its land area, compared to around 12 per cent 50 years ago with analysts warning that the continued destruction of forests will lead to a water crisis that could extend beyond the borders.

A rising demand for wood products continues to pile pressure on the country’s forests through illegal logging, crippling efforts to attain the UN recommended minimum forest cover of 10 per cent by 2020.

Estimates by the Kenya Forest Service (KFS) shows the demand for wood products is set to increase sharply by 2032 with poles likely to witness the fastest growth at 58.2 per cent, building timber (43.2 per cent), firewood (16.1per cent) and charcoal 17.8 (per cent).

The overall supply of wood products is, however, projected to grow slower than the demand, increasing the deficit by 26.5 per cent to 13,064,250 square metres by 2032.

According to KFS, Kenya currently has a wood supply potential of 31.4 million square metres against a demand of 41.7 million square metres.

Timber surplus is set to decrease by 7.4 per cent while that of the poles will go down by four per cent by 2032.

The growing rural population and urban poor is also expected to push up the demand for charcoal and firewood.

Due of the rising demand, firewood and charcoal deficit is projected to increase by 18.3 per cent and 19.1 per cent respectively.

Between 2011 and 2015, the country’s tree cover increased by 5.3 per cent, according to the World Bank. The area under forest increased from 43,266 square kilometres to 44,130 square kilometres in 2015.

Data showed that counties in Mt Kenya and Rift Valley account for the largest areas under forest cover. The lake region is the least forested despite receiving sufficient rainfall annually compared to northern counties.

According to the Kenya Data Open 2015, Isiolo is the most forested county with 53.45 per cent compared to Kisumu with 0.44 per cent of land under trees.

Nyeri has 38 per cent of its area under forest cover while Kirinyaga has 20.6 per cent, whereas Nyandarua and Meru counties have 18.44 per cent and 18.3 per cent respectively. Counties in the Rift Valley are also heavily forested with Elgeyo Marakwet having 37.4 per cent of its land under trees.

Nandi and Baringo have 26.2 per cent and 25.1 per cent cover respectively.

Other counties with low forest cover are Mombasa, Siaya, Busia, Migori, Kisii, and Vihiga.

Nairobi City, the smallest county in size but with the highest population, has 7.78 per cent of its land mass under trees.

Garissa has 7.09 per cent compared to Mandera’s 3.04 per cent.

According to the statistics agency KNBS data on national population, 64.6 per cent of households rely on wood fuel, putting a strain on the country’s forest cover.

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