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Forestry and Related services
BY Marc Bosman
South Africa
13 March 2018
R 10 080.00 (ZAR)  
estimated $ 730.26 (USD) *
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The Forestry and related services sector


Forestry South Africa (FSA) members include 11 corporate timber companies, approximately 1,100 commercial timber farmers and 20,000 small growers who collectively own or manage 91.6% of regulated afforestation. According to the Department of Agriculture, Forestry and Fisheries (DAFF), there are approximately 300 primary processing plants classified as saw, pulp and board mills in the country. FSA reported that total 2016 forestry contribution to GDP, when paper and paper packaging are included, was R58.2bn or 1.53% of GDP.


Industry growth and Sustainability


The forestry value chain requires increasing volumes of timber to produce an increasing range of wood, pulp, paper, packaging and products driven by rising populations requiring more sustainable food, clothing and housing. There is mounting pressure on governments and manufacturing industries to meet sustainable development goals (SDGs) and combat climate change by reducing fossil fuel and fossil fuel-derived chemical product, manufacturing and consumption. These movements are driving industry growth. Rising anti-plastic consumer sentiment is driving demand for sustainable wood fibre, pulp, paper and packaging, whether as bags for agricultural commodities or feed products, containerboard for agricultural produce, or packaging to ensure food remains fresher and safer for longer. At the same time the move to produce more sustainable housing and buildings is driving growth in wood construction and the production of engineered wood, structural wood products, and wood boards and panels.


Report coverage


The detailed Forestry and Related Services report discusses current conditions and the many difficulties faced by role players, which include the contraction in producer numbers, rising costs, disease and pests and competition for land and water. Eighteen industry players are profiled including KAP Diversified Industrial (Pty) Ltd, which in December 2017 issued a SENS notice distancing itself from major shareholder Steinhoff, and asserting that KAP exercises independent management, control and funding. Also profiled is Singisi Forest Products (Pty) Ltd which suffered devastating fires and significant loss in its Matiwane forests during 2017.


Page
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 2
2.2. Geographic Position 5
3. SIZE OF THE INDUSTRY 7
4. STATE OF THE INDUSTRY 13
4.1. Local 13
4.1.1. Corporate Actions 17
4.1.2. Regulations and Standards 19
4.1.3. Enterprise Development and Social Economic Development 23
4.2. Continental 25
4.3. International 28
5. INFLUENCING FACTORS 29
5.1. Economic Environment 29
5.2. Government Initiatives 29
5.3. Rising Operating Costs 30
5.4. Insufficient Investment 31
5.5. Technology, Research and Development (R&D) and Innovation 31
5.6. Renewable Energy 35
5.7. Labour 36
5.8. Cyclicality 40
5.9. Environmental 40
6. COMPETITION 42
6.1. Barriers to Entry 43
7. SWOT ANALYSIS 44
8. OUTLOOK 44
9. INDUSTRY ASSOCIATIONS 45
10. REFERENCES 47
10.1. Publications 47
10.2. Websites 48
COMPANY PROFILES 50
AMATHOLE FORESTRY COMPANY (PTY) LTD 50
BEDROCK MINING SUPPORT (PTY) LTD 52
BRACKEN TIMBERS (PTY) LTD 54
C J RANCE (PTY) LTD 57
KAP DIVERSIFIED INDUSTRIAL (PTY) LTD 59
MASONITE (AFRICA) LTD 63
MERENSKY TIMBER (PTY) LTD 66
MONDI LTD 68
MTO FORESTRY (PTY) LTD 72
NCT FORESTRY CO-OPERATIVE LTD 74
R AND B TIMBERS (PTY) LTD 77
SAPPI LTD 79
SINGISI FOREST PRODUCTS (PTY) LTD 84
SIYAQHUBEKA FORESTS (PTY) LTD 86
SOUTH AFRICAN FORESTRY COMPANY (SOC) LTD 88
TREATED TIMBER PRODUCTS (PTY) LTD 91
U C L COMPANY (PTY) LTD 94
YORK TIMBER HOLDINGS LTD 97