Wood is a unique raw material that is environmentally friendly and can be harvested and replanted in managed forest areas. The product is largely classified on the basis of the growing regions (tropical and temperate) and attributes (coniferous and non-coniferous).
It is traded in a variety of forms including, but not limited to, round logs, sawn lumber, plywood, veneers and fiberboards. The world trade of round logs and sawn timber itself, is in excess of 120 million cubic meters and is valued at over US$ 25 billion.
Olam s role in the Wood Products Business
Olam s first entry into the timber business was in the teak trade flow from Ghana to India in 1994 and has since posted an impressive growth rate over the past decade. In this journey, we have moved to being one of the largest suppliers of teak round logs to the world. This spectacular growth is the result of our strength in the three key dimensions of the business - sourcing, species and markets. We trade primarily in tropical round logs and tropical sawn lumber. World trade in this category is about 18 million cubic meters with a value of about US$ 4 billion.
The rationale for this choice of segment is the opportunity it offers us to leverage its core strengths in origin management and its physical presence in producing countries. The ability to transfer understanding and experience of the timber business across origins, species and markets through intensive training and good management processes has been key to the rapid growth that we have achieved. In addition, since we are multi-product company, the operations are able to share resources and allocate fixed costs across products thereby making the timber business cost competitive and locally effective.
The major producing countries for us within this segment are Gabon, Zaire, Congo, Ivory Coast and Brazil, in addition to some smaller producing countries, including Ghana, Nigeria and Mozambique.
Our focus on quality control is reflected in its effective management systems. Log selection is undertaken on the basis of physical inspection by graders at the site and after all the species are graded, the quality determined and their measurements taken, the logs are then individually marked. The logistics team up-country, which procures logs from the loggers, oversees the handling and movement of the logs to the log park where the quality, the number of pieces and the measurement is rechecked. Our robust risk control systems have ensured that the operations can sustain its track record of growth.
We are involved in the whole value chain from contract logging of teak plantations, through to logistics handling, processing, shipping and redistribution. We are involved with sawn timber business in Ghana and Nigeria with plans to invest in the downstream processing in Congo and Gabon.
On the marketing front, we offer a basket of origins and or species to customers in the Indian Subcontinent, Continental Europe and the Far East. We have our own offices in these markets to provide personalized service to customers. These offices also help collect information on species preferences and latest trends, which are in turn relayed back to the origins and dynamically, adjust to demand changes. We also use our wide origin spread and familiarity with multiple growths to suggest alternate species, which may offer better value to customers.
We plan to expand into more tropical origins, offer a wider range to the current consumer, develop customer network in existing markets and future focus markets like North America and the Middle East. Our objective is to enhance value through providing superior service to our customers whilst contributing to the economies and people who benefit from managed forest cultivation.
Olam considers preservation of forests as a part of its social responsibility that goes hand-in-hand with long term business objectives. Olam s objective is to deal in wood products that come from sustainable and well managed forests.
|
|
公 司 介 紹
