1. Forest Certification Overview and Current Trends Global Forestry Forum Oaxaca, Mexico

2. Outline for Presentation • What is forest certification • Schemes and Definitions • Current Trends in Forest Certification • Main Challenges for Moving Forward

3. What is Forest Certification ? • Market-based Instrument for differentiating sustainable managed forest products (voluntary green label) • Consistent with ISO 14001 but goes further • Forest Stewardship Council (FSC) certification was initiated in 1992 after the Rio world environmental summit in lieu of an international forestry convention such as UNFCC (climate change), CBD (biodiversity), etc. • Multiple schemes evolved: SFI, PEFC, CSA, ATO, national in Indonesia, Brazil, Malaysia

4. FSC System and Process • 9 principles; 32 standards and criteria • FM (forest managment) COC (chain of custody) are two types of certificates • national standards based on national initiatives through working groups • third-party certification and audits • accredited certification bodies under FSC - SGS, Smartwood, • strong on balance of social, environmental and economic elements (Credibility)

5. Lessons regarding certification • Compared FSC, Energy Star, Marine Stewardship, Organic Agriculture • Works best when product identifiable or saves costs of production • When more than 2 years go by without supplying outstanding demand, pressure for alternative system emerges • Only 20% market share possible for most such systems. Source: Cashore et al Yale University

6. Other schemes • USA: Sustainable Forest Initiative (SFI) • Canada: Canadian Standards (CSA) • Europe: Pan- European Forest Certification (PEFC) (many smallholders and cooperatives) • National initiatives and standards (under FSC or independently)

7. SFI • Results oriented: Management Standards; Industry Standards • Strong on Documentation geared to industry • Pinchot Foundation/Meridian study showed little difference in standards--more demanding social and environmental in FSC/ more on documentation in SFI • SFI linked to Tree Farm program for smallholders --with federal subsidies • (Mark Rickenbach study in JoF) 2002

8. Certification: A Changing Standard in the Marketplace • A growing world phenomenon • Promoted by DIY and others to consumer: supply of 50% of market in USA.. • Buyers groups in 17 countries; 12 producers groups and expanding • 20 Chain of Custody certifications in China FSC Area Certified Annually and Cumulative

9. How much world area is certified? • 109 M Hectares of Forest all schemes • 30 M Hectares FSC certified • 1 M Hectares community enterprises or CFEs

10. FSC Certification Data

11. ISSUES AHEAD

12. Decline in Consumer Price Since 1997, the average return to capital in the forest industry sector has been 4.1% *Adjusted by US GDP deflator

13. Plantation Development Trends • Plantation Investments mainly in tropical and sub-tropical regions • Over next 25 years non-native plantations projected to expand by 50%; • 34% of which in Latin America China—45 MM Public Ownership Venezuela—900,000 Public ownership Vietnam—1.7 MM Public ownership South Africa 1.5 MM Ind. private Indonesia—9.9 MM Chile—2 MM Industrial Private Brazil 5 MM Non-industrial Private Uruguay—622,000 Non-industrial private Hectares non-native plantations Australia – 1 MM 69% Public Argentina—900,000 Non-industrial private New Zealand– 1.8 MM Non-industrial Private Source: Forest Technology Group, MeadWestVaco

14. A Number of Challenges • Plantations competing with NFs • Market does not usually pay a premium • FSC can become gold standard--how high? • Hard to advance in tropical forest countries • Complexity: Non-timber and ecosystem services and cultural values • Equity: Few communities find certification in their reach • What is the role of government--not currently in FSC but is often a big forest land owner

15. Initiatives to move forward • Group certification to reduce costs • Small and low intensity pilot standards (SLIMFs) • Global Forest and Trade Network Producer Groups --Modular certification • Stepwise approach of IKEA and others to move in steps towards long-term goal

16. Labelling Alternatives Non-timber, complex settings, CFEs • Fair trade standards or social standards • Local or regional brands (USA) • Indigenous Peoples eco-standards • CIFOR C&I (Asia, Africa) • Ethnical collection standards (NTFP-USA))

17. Topics under Review Communities (CFEs) and Forest Certification Smallholders and Forest Certification Ecosystem Services and Forest Certification Government Policies and Forest Certification Certification in Complex Political Settings NTFPs and Forest Certification

18. THANK YOU