Timber Industry-Structure and Characteristics

This is the Character and Structure of the Malaysian Timber Industry

The industry can be divided into the upstream and downstream sector.  Whereas the upstream sector is chracterised by the systematic and sustainable harvesting of natural forest and forest plantation, the downstream features three levels of processing. Of the primary activities, this will include processing of raw materials (logs) into sawn timber, plywood, veneer, fibreboard and particleboard. Some 60% of these are exported.

Secondary and tertiary processing will include furniture manufacturing, mouldings, flooring, laminated timber, builders’ joinery and carpentry  Some 40% of these outputs are exported.

The industry currently continues to be labour- intensive. There is low mechanisation or use of automated systems. Of the 300,000 workers in the timber industry, about 175,000 or 58% are foreign workers.

                                     

Skewed Over-dependence on Foreign Labour in the Industry

While young local workers shun the industry because of its ‘dirty, dreadful, demeaning, dull and dangerous’ label and image, a looming issue is the current scarcity of foreign workers to be recruited from the source countries for the local timber industry. Foreign Indonesian workers are now harder to recruit. As the prices of most commodities continue to rise, the plantations in Indonesia are willing to pay higher wages to their nationals and this has stemmed the outflow of labour to Malaysia. This overdependence of the timber industry on foreign workers is critical at the moment and worrisome in the long run. It will negate the growth of this industry and its contribution to the national economy in many aspects.