Environmentalists are concerned that China's paper industry, along with its similarly red-hot wood products industry, is rapidly drawing imports of logs and pulp regardless of whether they were from "legal and sustainable" forests.

"China is by far the world's biggest consumer of wastepaper and that's a good thing because in the last four years alone, China has prevented 65 million metric tons of wastepaper from heading to landfills in the US, Japan, and Europe," said Brian Stafford, the lead author of the report.

For example, wastepaper is now one of the top US exports to China.

"Just last year, China's use of wastepaper instead of trees to make paper products probably saved 54 million metric tons of wood from being harvested for pulp," said Stafford, an expert on the international pulp and paper industry.

But as China's producers scramble to meet growing domestic and international demand for especially for higher quality paper, they continue to "source substantial amounts of wood and wood pulp from countries where good forest management cannot be assured," he warned.

The report pointed out that recycled material alone could not sustain China's paper production and that China's soaring demand for "virgin" pulpwood is a major threat to forests around the world.

The same explosive growth that's created such a strong market for wastepaper is also boosting China's demand for pulp and pulpwood derived from developing countries already struggling to contain illegal and destructive logging, it said.

"China is ramping up the production of largely high quality paper from pulp imports -- some of which is are from Russia and Indonesia -- because of rising demand from consumer countries, including the United States and Europe," said Luke Bailey, program associate with Forest Trends.

But the report highlighted the fact that about 60 percent of fiber used to manufacture paper and paper board products in China was derived from wastepaper.

In the last ten years China's wastepaper imports increased by more than 500 percent -- from 3.1 million tonnes in 1996 to 19.6 million tonnes in 2006 -- with most of that growth occurring between 2002 and 2006, it said.

"It's clear that the sheer volume of the wastepaper used in Chinese manufacturing has a very beneficial and stabilizing effect on the global market for wastepaper, which in turn makes wastepaper collection a viable 'green' option for communities in wealthy countries," said Kerstin Canby, director at Forest Trends.

As environmentalists worry about the effects on forests, American paper producers are nervously monitoring the market power of their Chinese counterparts, the report said.

US producers, claiming that government subsidies give their Chinese counterparts an unfair advantage in the world paper market, recently convinced the US Department of Commerce to place trade sanctions in the form of higher import duties on glossy paper manufactured in China.

earlier related report
Despite Chinese ban, Myanmar timber still crosses border
Yangon (AFP) July 15 - Environmentalists in Myanmar have expressed their shock at seeing mountains of logs being transported on trucks across the border into China despite efforts to halt the trade to save the country's forests from total destruction.

"I was shocked to see mountains of logs and big timber trucks" heading from Laiza into China, the spokeswoman for one local environment group, the Pan Kachin Development Society (PKDS), said.

On condition that she not be named, she told AFP she had counted up to 80 trucks crossing the border each day during a visit to the town in April. Stacks of teak, tamalan and other woods lined the roads waiting to go, she said.

"It seems they have set up sawmills in the forest and chopped the trees to be easier to carry," she said. "Some logs were only about one and a half feet (0.45 metres) in circumference," although China usually wants trees nearly twice that size.

"That means that people even cut small trees because there are no more big trees left," she said.

The trade endures despite China's efforts to stop it because of a complex mix of interests.

For Myanmar's junta, timber is one of its major sources of desperately needed foreign currency.

Two main ethnic Kachin groups who have partial control over the region also see the timber trade as a key source of income and have shown varying degrees of willingness to stop it.

Local Chinese authorities along the border have not consistently enforced the year-old ban, creating pockets where timber still flows across the border.

Laiza, a village about 1,000 kilometres (675 miles) north of Yangon, is the base for the Kachin Independence Organisation (KIO), one of 17 armed ethnic groups to have signed ceasefires with the military junta that runs Myanmar.

After the KIO signed its ceasefire in 1993, the group received a degree of autonomy in their part of Kachin state, a region sandwiched between China and India that is home to virgin forests as well as jade, gold and other mineral reserves. -- Myanmar timber reserves help feed China's insatiable appetite -- Laiza quickly turned into a significant trading town, especially for timber which once flowed freely across the border about 160 kilometres (100 miles) away to feed China's insatiable appetite for raw materials.

Some 1.5 million cubic metres (53 million cubic feet) of timber worth 350 million dollars was exported from Myanmar to China in 2005, most of it illegal, according to Britain-based forestry watchdog Global Witness.

That was a 12 percent gain over the amount of timber shipped to China the year before, and rougly double the amount exported in 2000, Global Witness said.

China, which has imposed stiff limits on logging in its own forests amid fears of deforestation, uses the wood to supply its construction boom and its soaring exports of wooden furniture.

But in the face of international pressure that followed the Global Witness report, China decided a year ago to officially close its borders to Myanmar's timber.

Global Witness said one of its teams spent a couple weeks on the border in April, and they believed the ban has had a major effect on the Chinese side, although some problems remain.

"What we are seeing from the Chinese side is there has been a ban in all areas along the border, no question about it," said Mike Davis, Global Witness team leader for the Southeast Asia forest campaign.

With scant data from Myanmar's government, environmental groups analyse Chinese import and logging data to estimate the size of the trade, but no precise data has been made available since the ban took effect last year.

But to illustrate the ban's overall effectiveness, Davis pointed to the town of Pianma, a major border timber town.

Migrant workers flocked to the city a decade ago when the illegal trade turned it into a boom town, driving its population from 3,000 to about 40,000. Since last year, Davis said the town was down to 10,000 people as migrant workers found the logging business drying up.

"That said, there is stuff still coming across in various places, and in some places at times in quite large volume. We are concerned, I think these types of activity are on the increase." -- Government support for ban undermined by commercial interests -- At government level China appeared to be genuinely working at shutting down the illicit trade, Davis said, but he added that those efforts had been hampered by Chinese companies fiddling with their quotas or hunting for loopholes in the ban.

Some of the trade is just plain smuggling, he said.

"Chinese businesses involved in the trade are increasingly choosing to buy pieces of forested land within Kachin state in order to clear-fell all tree cover," Davis said.

"This is a particularly destructive approach to logging that causes huge environmental damage."

Clear-cutting in Myanmar's interior also makes it difficult to estimate the extent of the deforestation because outsiders have so little access to the area.

But Global Witness says huge swathes of land along theborder have been logged.

One former military man who was involved in the trade in Myanmar said that logging was still possible if big enough bribes were paid to local police, forestry officials, military personnel, and local militia groups.

"If we got a logging permit for 10 tonnes from an official, we would cut at least 30 tonnes of trees just from that permit paper," the former military source said, speaking on condition of anonymity.

He said he had left the armed services after the pro-democracy uprising in 1988, and like many other former soldiers ended up taking a job in logging where he used his military connections to facilitate the passing of bribes from companies to the government.

He believes his company made a lot of money, but says that wealth didn't trickle down. He finally quit the business in 2000 because he was fed up with the corrupt system.

Sometimes, he said, he had received permits to log in areas that had already been clearcut. "What we did then, we'd just find a place where there were still trees and cut them down," he said.

Despite the concersn about the future of the Myanmar forests, Global Witness's Davis said he believes the Chinese authorities had managed to significantly curb the trade, in part because they wanted to avoid negative publicity ahead of next year's Beijing Olympics.

"We think that although the restrictions that the Chinese imposed are not an end solution in themselves, they are an encouraging start."

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