Forest Management Overseas

Basic Policy

As national governments throughout Southeast Asia strengthen their promotion of natural forest conservation, they are implementing restrictions on harvesting and exports, among other measures that reduce the supply of natural wood. In addition, as momentum toward SDGs and sustainable development increases, it has become necessary to convert to timber obtained through forest plantation and certified forest management practices that ensure both environmental consciousness and stable supply. The Sumitomo Forestry Group implements forest plantation operations that take local communities and ecosystems into consideration to enable a stable and sustained timber supply while helping to reduce the impact on natural forests.

Overseas Plantation Area (Unit: ha)

Country Name of Plantation Business Managed Area Plantation Area for Social Forestry Planted Area in FY2018 Logged Area in FY2018
Indonesia Industrial tree plantation PT. Mayangkara Tanaman Industri 104,664 0 2,558 2,991
PT. Wana Subur Lestari 40,750 0 2,134 2,392
PT. Kutai Timber Indonesia (KTI) 4,400 0 0 0
Social forestry PT. Kutai Timber Indonesia (KTI) 0 6,144 0 0
Koperasi Serba Usaha Alas Mandiri (KAM KTI) 0 1,005 0 0
Koperasi Bromo Mandiri KTI (KBM KTI) 0 460 0 0
PT. Rimba Partikel Indonesia (RPI)*1 0 637 0 0
Other*2 0 3,633 0 0
  Subtotal 149,814 11,879 4,692 5,383
Papua New Guinea Industrial tree plantation Open Bay Timber Ltd. (OBT) 31,260 0 469 113
New Zealand Industrial tree plantation Tasman Pine Forests Ltd. (TPF)*3 36,360 0 668 753
Total 217,434 11,879 5,829 6,249

*1 The land area is calculated by conversion from the number of seedlings distributed at RPI. Vegetation determined to have withered is included in the harvest.

*2 Others includes data of environmental reforestation for social contribution and consulting business for other companies

*3 Acquisition of the forest area managed by TPF was completed in June 2016.

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Forest Management Overseas

The Sumitomo Forestry Group is expanding three approaches to conducting plantation forest operations; industrial tree plantation, environmental reforestation, and social forestry. The purpose of industrial tree plantation is to produce wood and increase the supply of plantation timber (raw material). By zoning its managed land appropriately, the Group aims to achieve both the conservation of valuable ecosystems and the development of local communities through plantation forest operations.

In addition, the Group also conducts environmental reforestation, planting trees for environmental conservation. It aims to contribute to environmental conservation through the expansion of forested areas and the fulfillment of the ecosystem services function of forests, by actively planting trees on land where natural regeneration would otherwise be difficult. The Group has also been engaged in “social forestry” which shares the economic benefits of forest plantation with local communities while enlisting the cooperation of local residents.

Plantation Forest Operations in West Kalimantan, Indonesia (Industrial Tree Plantation)

Since 2010, under the license from Indonesian Ministry of Environment and Forestry permitting utilization of timber from commercial forests*, Sumitomo Forestry has been committed to a large-scale forest plantation business conducted in cooperation with the ALAS Kusuma Group, a company involved in forestry management and plywood manufacturing in Indonesia. The project covers areas in which forest degradation has advanced due to commercial harvesting from the 1960s to the mid 1990s in addition to repeated illegal logging and slash-and-burn farming practices. In these types of lands, Sumitomo Forestry Group actively uses devastated forests where productivity is not expected as plantation forests while taking on the responsibility of preserving forests with high conservation value. In addition, we believe it is important to prevent further degradation of forests by providing an economic infrastructure to local communities through businesses.

The Group aims to plant trees with appropriate management for each piece of land with consideration to different environmental factors such as topography and soil conditions in its plantation forest operations. Furthermore, we conduct research and monitoring based on the latest knowledge from third parties to continually improve our operations. The planting, cultivation and harvesting work done by human hands largely contribute to local communities by creating jobs.

* Issued by the Indonesian government, this is a business license to engage in industrial tree plantation operations in Indonesia. The license is valid for 60 to 100 years.

Reforestation project
  • Signed a contract with International Finance Corporation (IFC)—member of the World Bank Group for the provision of advisory services. In accordance with the concept of High Conservation Values Forests (HCVF)* that draws great attention in recent years, Sumitomo Forestry conducted assessments on its operational properties with IFC and investigated whether the property use plan is implemented as stated and adequate consideration is made for biodiversity and livelihood of local residents. The reports of the investigation results were audited by a third-party organization, and valuable comments made by stakeholders on the report were adapted in the business plan.
  • Held public hearings where stakeholders such as local residents, companies in the communities, academics, NGOs, and government officers were invited to share the results of the investigations.
  • Obtained the PHPL certification, formally called Sertifikat Pengelolaan Hutan Produksi Lestari issued by Ministry of Forestry (Departemen Kehutanan) on sustainable forest management.
  • Held public hearings with stakeholders prior to plantation forest harvest with the aim of deepening stakeholders’ understanding about our businesses and consideration to environment and social issues that we promote. This venue also actively pursued cooperation from our stakeholders to prevent forest fires. Participants not only shared a lot of positive feedback but also gave us comments fruitful in the formulation of our business plans.
  • Advanced efforts with the Indonesian Ministry of Environment and Forestry to build a model for sustainable plantation forest operations and peat management methods in peatlands through our businesses and research activities.
  • The Commissioner of Peat Land Recovery visited the local grounds to observe the peat management technology. Gained high praise for groundwater level control technology and the newest initiatives founded in data as well as introduced both in an international venue for government officials as beneficial examples for Indonesia.
  • Entered into a Memorandum of Understanding (MOU) with the Indonesian Ministry of Environment and Forestry for a pilot project that aims to examine unique water level management technologies to sustainably manage peatlands and establish peatland management models in Indonesia. The term of this project is set for five years. The project is being conducted with the cooperation of the Ministry of the Environment and Forestry as well as the Peatland Restoration Agency.
  • The peatland management technology from this project was introduced as an example of excellent, leading-edge peat management at the November 2017 United Nations Climate Change Conference (COP23) held in Bonn, Germany.
  • In 2018, the Group formulated a grievance mechanism with the help of the IFC. Together with the University of Indonesia, we also conducted a social survey of operational and surrounding areas on a three-year plan.
  • We reported on peatland management technology at the December 2018 United Nations Climate Change Conference (COP24) held in Poland.

* In considering the value of forests, it goes beyond their value as absorbers of greenhouse gases, outlining methods of extracting each one of the many aspects of value forests contain. These aspects include their value as habitats of rare, endangered animal species, as water resources, as providers of essential natural services such as soil erosion control, and as land that has an intimate relationship with the lifestyles and cultures of local communities.

Conservation of Peat Swamp Forests

Conventionally, reforestation in peatlands* pushed water out of the soil and dried the land by digging many drainage routes for planting. However, drying-out land results in the decomposition of organic matter in the peat soil and acts to heighten global warming due to the emission of greenhouse gases. Dried peat, once ignited, is very difficult to extinguish, creating the risk of large-scale forest fires. The soil needs to always be in a damp state to prevent fires, but this means maintaining a constant groundwater level throughout the year through proper water level management is extremely vital. Therefore, in drawing up a forestation plan, the Sumitomo Forestry conducts detailed measurements and surveys based on which the following areas are identified: (1) forests to be protected with riparian forest and high rarity value, (2) areas to set as buffer zones between protection zones and plantation zones, and finally (3) areas the final determination as plantation zones. In plantation zones, water routes that function as round log transport, water level control, and fire belts are constructed while allowing a constant water level in the peatlands to always be maintained without affecting the rivers by not directly connecting the water routes and the rivers. Maintaining a constant groundwater level not only prevents forest fires and minimizes the breakdown of peats but also limits the emission of greenhouse gases. These results have been announced at relevant government agencies, universities and other institutes and some aspects have even been adopted as new policy measures. In addition, we actively release technical abstracts as we work to spread technologies to reduce environmental impact. The technology we have developed also has the potential to be utilized in reforestation of areas devastated by large-scale fires.

* Characteristics of the peat soil found in the peat swamps is known to emit enormous amounts of greenhouse gases, typically carbon dioxide and methane gas, if the soil was inappropriately exploited. Owing to joint researches by Japanese and Indonesian academic institutes, this project takes consideration to minimize greenhouse gas emissions that accrue as the peaty soil dissolves during exploitations.

Land for plantation forest operations designed based on detailed data

Land for plantation forest operations designed based on detailed data

Monitoring the water level in peatlands

Monitoring the water level in peatlands

Peat Swamp Forests

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