An International Multidisciplinary Journal, Ethiopia
Vol. 6 (4), Serial No. 27, October, 2012
ISSN 1994-9057 (Print) ISSN 2070--0083 (Online)
DOI: http://dx.doi.org/10.4314/afrrev.v6i4.13
The Forest Products Industry in Nigeria
(Pp.191-205)
Ogunwusi, A. A. - Raw Materials Research and Development Council,
Plot 17, Agiuyi Ironsi Street Maitama, Abuja
Phone: +2347034789966
E-mail:
[email protected]Abstract
The forest industry in Nigeria is undergoing a difficult period as a result of a
multiplicity of factors. This study evaluates the performance of the industry,
and results indicated that capacity utilization in the sawmill subsector was
6,994,660m3, 6,031,922m3, 7067145m3 and 3,800,000m3 respectively in
1988, 1992, 1996 and 2010. In the veneer and plywood mills, capacity
utilization was 72,240m3, 54,600m3, 14,900m3 and 10,250m3 respectively in
1988, 1992, 1996 and 2010 respectively while particle board production has
also been dwindling in recent years. The total particle board produced in
2010 was only 9,736m3 as against an installed capacity of 45,000m3. In the
safety matches subsector, capacity utilization increased from 7,500 in 1988
to 16,200m3 in 1992 and 52,980m3 in 1996. Capacity utilization in the
subsector was 11,496 in 2002 and 2010 respectively. Wood treatment
subsector also witnessed a decrease in capacity utilization from 52,980m3 in
1996 to 11,496m3 in 2002 and 2010 respectively. There is the need to locally
promote industrial clusters, cooperatives and private forestry through policy
initiatives in this sector.
Key words: Capacity utilization, installed capacity, sawmill, plywood,
particleboard, safety matches
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Introduction
The forest products industry in Nigeria was one of the most developed within
the Nigerian economy in the 1960‘s to the early 1970‘s. During this period,
export of wood products and agricultural commodities provided more than
70% of the country‘s Gross Domestic Product (GDP). However, the oil glut
of the 70‘s led to gregarious exploitation of round logs for export until its ban
in 1976. The over exploitation of the wood resources has impacted negatively
on the development of the forest products industry. This, coupled with
several other factors such as old age of equipment, etc; has resulted in the
dwindling fortune of the country‘s forest industry. This paper discusses the
results of a study conducted to examine the structure and performance of the
Nigerian forest industry and suggests recommendations to enhance industry
stability and competitiveness.
Forest resources availability and exploitation in Nigeria
The present public forest estate which was acquired between 1900 and 1970
embraces 100,000 km or 11% of the total land of the country. Only about
26% of this is in the high forest area. It is estimated that an additional
90,000km2 of high forest is available outside the forest reserves. The forest
resources have served as an engine of growth and propelled economic
activities in Nigeria as far back as 1792 when pit sawing operation
commenced, followed by the establishment of a power sawmill in the Delta
area in 1902 (Aribisala, 1993). These developments led to a substantial
increase in wood exploitation for utilization in domestic industries and for
export. Wood export peaked in 1950‘s with log and sawn wood and
subsequently, veneer and plywood. This trend was maintained and sustained
in the 1960‘s and early 1970‘s. However, by mid 1970‘s, the toll of intensive
exploitation has started showing and volume of wood export which peaked at
700,000m3 in 1964, decreased steadily to 290,000m3 in 1970 (Aribisala,
1993).
Among the factors that led to the reduction in forest resources availability is
intensive exploitation of the resources. As far back as 1899, the perspective
planning for economic development was to exploit forest resources
(Adeyoju, 1975). The export revenue from forestry grows at 4.1%, 8.0% and
28.8% between 1950-60, 1960-70 and 1970-80 respectively (Aribisala,
1993). The period witnessed the development of a virile forest products
industry made up of well structured saw mills, wood panel industries,
furniture industries, match factories and pulp and paper industries. The
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The Forest Products Industry in Nigeria
development of the forestry sector is characterized by mechanically
processing of timber into sawn wood, veneer and plywood. This promoted
the vast growth of the economy by making positive contribution to raw
materials production and supply for construction, furniture and packaging.
Impact of forest over- exploitation on wood industry
More recently however, there have been changes in the structure of the
forestry sector. The forest resource survey, 1996-1998, revealed that the
forest cover has decreased by 20% over the preceding 18 years. According
to Adeyoju (2001), the total forest estate which stood at 10% of the country‘s
land area in 1996 is now less that 6%. Ola Adams and Iyamabo (1977)
estimated that about 26,000 ha of forest land are destroyed annually in the
rainforest zone during the conversion of natural forests to plantation forests
and other forms of land use. World Wildlife Fund estimated that over 90% of
the natural vegetation had been cleared and over 350,000 ha of forest and
natural vegetations are lost annually (WWF, 1989),
These occurrences have significant impact on the operations of the forest
industries leading to a decline in the contribution of the industries to national
industrial development. Studies by RMRDC (2009) indicated that the total
volume of usable wood down to 30cm cutting diameter in the forest reserves
is 239,775,500cm3. This is not significantly different from 437,507,205.9m3
reported by Akindele et al (2001). Various studies (RMRDC, 2003;
Aribisala, 1993, and Oriola, 2009) have reported a decline in the performance
of the forest industries in Nigeria. Thus, there is the need for constant
assessment of forest industries in Nigeria in order to promote initiation of
policies that will lead to rejuvenation of the sector. This study provides one
of such attempts.
Materials and methods
This study derived from a survey designed to assess quantity, production
trend and status of forest industries in Nigeria. Data used for the study was
obtained through the use of a structured questionnaire. The questionnaire was
on installed capacity, capacity utilisation, equipment and production
processes, etc; in the forest industries in all the 36 states and the Federal
Capital Territory. Respondents were either enterprise owners or upper level
managers. The questionnaire was segmented into key areas in all the sub-
sectors of operation within the forest industries sector. 300 questionnaires
were administered. Complementary data were obtained from other sources
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Vol. 6 (4) Serial No. 27, October, 2012 Pp.191-205
of information such as from Food and Agricultural Organization and the Raw
Materials Research and Development publications. These sources were
supplemented with physical observations of mills and on-the-spot
assessments were used to validate information obtained from various sources.
Data analysis
The data obtained on installed and utilization capacities by the different
subsectors for 2010 when the study was carried out were tabulated and
summed up. The results obtained for the different subsectors were
juxtaposed with results of similar studies reported by the Raw Materials
Research and Development Council in 1988, 1992, 1996, and 2002 to
observe the variations in installed capacity and capacity utilization in
different years. Where available, installed and capacity utilization reported by
studies carried out by the Food and Agricultural Organisation experts in the
sector were also used for comparison. The percentage capacity utilization
was obtained as percentages of utilization capacity and installed capacity for
the various subsectors.
Results
Results indicated that there are five major wood industries in Nigeria. These
are the saw mill, wood based panel, furniture, safety match and the wood
treatment industries. 129 furniture industries which represented 50.39% of
total respondents completed the questionnaires while 116 sawmills which
represents 45.31% of the total respondents completed the questionnaires. 2
companies each among the producers of plywood and veneer, safety matches
and particle boards which represented 0.78% each completed the
questionnaires. Five wooden doors producers which represent 1.91% of total
respondents also completed the questionnaires (Table 1). In addition to
these, there are a number of other industries such as toothpicks producers,
pestle and mortal and wood carvers which are operating within the industry.
Most of these other industries operates at cottage level and mostly belong to
the informal sector.
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The Forest Products Industry in Nigeria
Table 1: Subsectors response to the questionnaire
Subsector No of respondents Percentage of Respondents
Furniture 129 50.39
Saw mill 116 45.31
Ply & veneer mills 2 0.78
Particle board 2 0.78
Safety matches 2 0.78
Wooden door products 5 1.91
Total 256 100
Sawmill industries
The installed capacity and capacity utilization of sawmills in Nigeria are
shown in Table 2. The table indicated that installed capacity in the sawmill
industry in Nigeria rose from 8,831,750m3 in 1988 to 15,793,188m3 in 1992.
It then decreased to 10,900,000 in 1996 and subsequently increased to 14,
684,000m3 in 2002 and 11, 734,000m3 in 2010 (Table 2). Capacity
utilization within these periods was 6,994,660m3, 6,031,922m3 , 7,069,145,
and 3,800,000m3 respectively (Table 2). This represented 79%, 38%, 39%,
35% and 32% capacity utilization respectively. Total number of sawmills
decreased from 1617 in 1990 to 910 in 1992. It rose to 1252 in 1996 and to
1259 in year 2002. In 2010, the number of sawmills in Nigeria stabilized at
1325.
Table 2: Installed capacity and utilization (round log equivalent) in the
Sawmill industry
Year No of Total installed Utilization Capacity
sawmills capacity capacity utilization %
M3/year M3/year
1988 N/A 8,831,750 6,994,660 79
1992 910 15,793,188 6,031,922 38
1996 1252 10,900,000 4,200,000 39
2002 1259 14,684,000 5,177,700 35
2010 1325 11,734,000 3,800,000 32
Out of the 1325 sawmills that operated in Nigeria in 2010, about 300 are in
swamp forests of Lagos and Rivers States which are fed with wood from the
adjourning states by rafting or water transportation. About 945 sawmills are
in the rain forest zones, most of which are located Edo, Delta, Ondo, Ogun,
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Oyo, Osun, Cross River States. In the savannah zone, there are about 80
sawmills located mainly in Taraba, Adamawa, Benue, Kwara, Kogi, Kaduna,
and Niger States.
Furniture industries
The furniture industry is strategic in the use of planks from the saw mills. It
forms the major market for wood products in Nigeria and protects the
continued existence of primary wood industries such as sawmills and ply
mills. The capacity utilization of the furniture industry was 217,700m in
1988. This increased to 250,714m3 in 1992. In 2010, capacity utilization of
the industry was 326,172m3 of round log equivalent (Table 3). More than
400 furniture companies of various sizes exist in the country. The shortfall in
large furniture companies is made up by the numerous cottage and small
scale furniture makers which numbers more than 10,000 outlets. This
category of furniture makers usually operate in the informal sector and are
found in the rural and urban areas where middle and low income earners
reside. Wooden furniture parts and components are now being
manufactured and exported by a few large companies in Nigeria. Wooden
furniture represents the major market for wood products in Nigeria. Many of
the industries suffer from high cost of production due to energy cost and lack
of patronage.
One of the major specialties of furniture makers in Nigeria is wooden door;
which is very popular in the country. Handmade carved doors are frequently
seen exhibited along the roadside by carpenters. Only 5 companies gave their
installed capacity. This amounts to 65,810 m3 with a current production level
of 6580 m3 representing 10% capacity utilization.
Table 3: Installed capacity and utilization (round log equivalent) in the
furniture industry
No of furniture Total installed Utilization Capacity
Industries capacity capacity utilization %
M3/year M3/year
1988 5000* N/A 217,700 N/A
1992 7,500* N/A 250,714 N/A
1996 10,000* N/A N/A N/A
2002 10,000* N/A N/A N/A
2010 810,000* N/A 236,172 N/A
* estimate only
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The Forest Products Industry in Nigeria
Plywood mills
In 1988, the total installed capacity was 126,000m3. This decreased to
106,000m3 in 2002 and further to 96,000m3 in 2010 (Table 4). Capacity
utilization in this sub sector has also been fluctuating. It increased from
67,340m3 in 1988 to 72,240m3 in 1992. Since 1992, capacity utilization and
number of industries operating within the subsector have been on decrease.
Capacity utilization decreased from 72,240 in 1992 to 54,600m3 in 1996 and
14,900 and 10,250m3 in 2002 and 2010 respectively. The number of plywood
mills increased from 8 in 1988 and 1992 respectively to 10 in 1996 (Table 4).
This decreased to 4 in 2002 and to 2 in 2010. Plywood or veneer production
requires input of logs of prime diameter and quality. Veneer slicing is all
integrated within plywood mills.
Table 4: Installed capacity and utilization (round log equivalent) in the
plywood mills
Year No of Ply mills Total installed Utilization Capacity
capacity capacity utilization
M3/year M3/year %
1988 8 126,000 67,340 53
1992 8 126,000 72,240 57
1996 10 126,000 54,600 43
2002 4 106,000 14,900 14
2010 2 96,000 10,250 11
Particle board mills
With an installed capacity of 85,000m3 in 1988, capacity utilization was a
mere 11,496m3 in 2010 (Table 5). Capacity utilization in 1992, 1996, 2002
and 2010 were 34,290m3, 54,600m3 12,900m3 and 11496m3 respectively
(Table 5). The number of particle board mills in the country has remained
constant at 4 from 1992 to 2010 (Table 5.) The factor responsible for this
low capacity utilization is competition with foreign particle boards which are
of higher quality and comparatively lower prices. Production in this subsector
is limited to what the domestic market can absorb. Apart from this, the small
output capacities and higher investment cost per unit of capacity will not
permit the present Nigerian particle boards mills to successfully compete on
the export market.
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Table 5: Installed capacity and utilization (round log equivalent) in the
particleboard mills
Year No of Total installed Utilization Capacity
particle capacity capacity utilization %
boards mills M3/year M3/year
1988 2 85,000 N/A N/A
1992 4 85,000 34,290 40
1996 4 67,150 54,600 81
2002 4 67,150 14,900 22
2010 4 45,000 11,496 26
N/A=Not available
Matches
Seven safety matches industries were identified to have been established in
the country. These comprised of three (3) in Lagos State, one each in Rivers,
Imo, Cross-rivers, Oyo and Kwara States (Table 6). This has however been
decreasing in recent times. While 6 safety matches companies operated in
Nigeria in between 1988 and 1996, the number of safety matches companies
decreased to 3 from 2002. Capacity utilization in the safety matches
subsector increased from 7,500m3 in 1988 to 16,200m 3 in 1992 and
52,980m3 in 1996 (Table 6). Capacity utilization stabilized at 11,494m3 in
2002 and 2010 respectively. The importation of wooden matches from Asia
is enormous. Most of the matches come from Malaysia, China, India and
Indonesia where they are made from Bombax spp. The matches are of
excellent quality with good appearance and are inexpensive. The continuous
importation of cheap wooden matches from Asia is hampering the growth of
this sub-sector.
Table 6: Installed capacity and utilization (round log equivalent) in the
safety matches producing plants in Nigeria
Year No of Safety Total installed Utilization Capacity
matches capacity capacity utilization %
M3/year M3/year
1988 6 N/A 7,500 N/A
1992 6 N/A 16,200 N/A
1996 7 N/A 52,980 N/A
2002 3 N/A 11,494 N/A
2010 3 N/A 11,494 N/A
N/A= Not available
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The Forest Products Industry in Nigeria
Wood treatment
Capacity utilization has also been decreasing with time in this subsector.
Capacity utilization decreased from 55,100m3 in 1988 to 37,750m3 in 1992
(Table 7). In 2010, capacity utilization dwindled to an all time low 12,370m 3
in the subsector. The wood treatment plants in Nigeria should by now be
experiencing increase in activity with the decreasing supply of durable wood
from the natural forests. However, most of the wood treatment plants are no
longer operational as a result of lack of spare parts and general maintenance
problems. Consequently, most companies now depend on few ones that are
working to treat their materials.
Table 7: Installed capacity and utilization (round log equivalent) in the
wood treatment plants
Year No of wood Total installed Utilization Capacity
treat-ment capacity capacity utilization %
plants M3/year M3/year
1988 8 N/A 55,100 N/A
1992 8 N/A 37,200 N/A
1996 10 N/A N/A N/A
2002 4 N/A N/A N/A
2010 2 N/A 12,370 N/A
N/A = Not available
Discussion
The saw mill industry is characterized by small scale operatives which
constitutes more than 90% of the entrepreneurs in the sector. A major
characteristic of the subsector is increasing number of operatives and
decreasing performance. The capacity utilization in the industry is averaged
37% and the lumber recovery rate 40-60% respectively as a result of old
equipment. According to Olorunnisola (2000), the annual rate of return is
between 15.2% and 44.3% while more than 70% of the workforces are
manual laborers. The saw mills used outdated technologies while only less
than 10% used advance technologies. Although, the sawmill industry has
grown from the pit sawing to circular saw head rigs and French manufactured
CD4, CD5, CD6 horizontal band saws, mighty mite, brenta vertical, kernali
brand, antiglo machine, jevo machine, primultini vertical and forestor
(Omoluabi, 1994), there are only few established saw mills that use the
Numeric Controlled (NC) devices. Technological improvement in this
industry will impact significantly on log to plank conversion efficiency.
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Changes in the raw material characteristics such as decrease in log diameter
in Nigerian forests also have a strong influence on conversion efficiency.
Apart from energy supply, another major factor limiting growth in the
industry is scarcity of economic timber resources. The short fall in installed
capacity and actual capacity utilization occurred as the saw mills are
structured to utilized large diameter logs which are now limited in the natural
forest as small size timber, dominate the present composition of Nigerian
forest resources (Larinde, 2010; RMRDC 2003). In Nigeria, round wood
processing has reached the limits of available forest resources such that the
future increase in wood production and revenue could be derived from
further processing of saw wood rather than expansion in sawmill and
exploitation of wood resources (Larinde, 2010). Consequently, Omoluabi
(1985), Oyegade (1997) and Larinde (2008) recommended that efforts should
be geared towards having most of the wood industries in Nigeria integrated
to enable the wood waste or wood materials which are not suitable for one
mill to be channelled to other mills that can process them.
While the domestic market for furniture is growing rapidly, the industry has
not contributed significantly to foreign exchange earnings as the industry is
dominated by small scale operators of about 3-5 workmen (RMRDC 2009;
GWV Consultants, 1994). In Nigeria, the furniture industry uses simple
technologies; they have low technical knowhow and low capital input. They
are mostly made up of outfits with crude hand tools and equipment
(RMRDC, 1991; 2003 and 2009), resulting in poor quality products (GWV
Consultants, 1994). The small scale furniture producers are technically
inefficient as they fall below efficiency level of 60% (Ako and Kuye, 2010).
The implication is that the average furniture producer need 48% cost saving
devices to attain the status of efficiency, while least furniture producer need
about 88% cost saving devices to become an efficient producer. Most of the
small scale operators in this subsector are more interested in quick profit
rather than quality control and expansion (NACETEM, 2010). Other
problems militating against adequate performance of operatives in this
subsector are low level of demand (Arowosoge et al. 2010), poor
workmanship (GWV Consultants, 1994), and high level of poverty and long
lifespan of furniture products. Others include the inefficiency of the ban on
furniture importation due to high level of smuggling (Aku, 2010), paucity of
skilled manpower and inadherence to standard drying, preservative treatment
and design procedures (Ogunwusi, 2011).
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The Forest Products Industry in Nigeria
Plywood production in Nigeria has reduced drastically in the country as a
result of high reduction in the volume of economic wood species (RMRDC,
1991; Arowosoge, 2010). Face veneer is in short supply as one of the major
producers; the government owned African Timber and Plywood has closed
operations. It is expected that the privatization of this company will lead to
the achievement of goals of the privatization exercise among which are
technological innovation and improved productivity. Currently a
considerable volume of face veneer is being imported from Ghana and
various parts of Europe (GWV Consultants, 1994). Other problems of face
veneer producers are old equipment and lack of spare parts.
The major factors limiting optimal production of particleboard in Nigeria are
uncertain investment climate and low exchange rate of local currencies to
import new equipment, spare parts and glue (GWV Consultants, 1994).
Current production is hampered by high cost of production resulting
primarily from high cost of imported resins.
The low cost of imported matches in juxtaposition with the high cost of those
produced in Nigeria make local production an unprofitable enterprise. To
protect this subsector it may be necessary to increase tariff on imported
matches.
While the need for preservative treatment of wood is becoming germane
locally as a result of decrease in ages and diameter of remaining wood
species in the nation‘s forests, the treatment plants in the country are closing
down by the day as a result of old age of equipment. Thus there is increasing
utilization of hand brushed wood in the wood and wood products sector.
In general, the Nigerian wood industry is gradually declining in performance,
efficiency and productivity due to the reasons already highlighted. High
quality saw logs and veneer logs are limited with 97% of log production
factoring into the lesser used wood species (Arowosoge, 2010). The shortage
of domestic supply of round wood is a constraint to producing high quality
final products that are competitive in international markets. As a result of
this, a number of lesser used wood species are now widely available in plank
markets in various parts of the country. In nearly all the ecological zones, the
wood species mostly found in the timber markets are those that are widely
available in the forests within the zones. For instance, Irvingia gabonensis
wood is now very popular in the planks markets in the south east and south
west zones while Prosopis africana and Detarium senegalense are now very
prominent in markets in the Northern parts of the country. The low
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acceptance of the lesser used wood species in international markets is
indicated by poor patronage (Jayanelti; 1998; Eastin et al, 2003; Barany et al
2003). Research studies (Coleman, 1998; Barany et al 2003) have indicated
that information on lesser known wood species availability, natural
durability, physical properties, working qualities, and use range which are of
utmost importance to manufacturers are lacking. Hence, efforts at promoting
increased utilization of lesser known species will not be successful without
well documented, readily available concrete information (Arowosoge, 2010).
Conclusion
The Nigeria wood products sector has traversed a variety of circumstances.
From being a buoyant sector in the 1960‘s to the early 1970‘s, the sector is
now a shadow of its former self. Nigeria used to be a major producer of
exotic furniture for export in the 1960‘s to 1980‘s in view concrete
investments in wood processing industries made by both the private
investors, federal and state governments. With the downturn in the economy
occasioned by oil glut and the introduction of the Structural Adjustment
Programme, the federal government‘s investment in wood processing was
bastardized and most of the companies such as Nigeria Romania Wood
Industry, the African Timber and Plywood, etc; where government had
controlling interests could no longer access foreign exchange for import of
equipment and parts. These rendered them unprofitable and were forced to
stop operating. This in turn stifled export development, resulting in a national
foreign trade balance deficit in the sector. Deficiencies in technologies and
finance, lack of qualified manpower and their rapid turnover are major
problems militating against optimal development of this sector. Thus,
technical training is a priority to promote production to international standard
and customers requirements. Most enterprises surveyed in this study are
unable to utilize maximum production capacity. Some of the main reasons
behind this are scarcity of economic wood species and insufficient demand.
An effort to develop a customer centric industry perspective, as opposed to
production centric perspective can help to make manufacturers more
competitive. This would include market research, customer satisfaction
studies and a strategic perspective of industry development.
In addition, one key element that can contribute to success in the sector is to
improve dialogue with university and research institutes. There is a wealth of
information and resources that can be used to develop this sector; however,
this are currently not exploited to their fullest potentials. Likewise the
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The Forest Products Industry in Nigeria
formation of product specific clusters in this sector will help in alleviating
problems of assessing finance for improved production and innovation. It has
also become very important that government should encourage private sector
participation in the establishment of economic indigenous wood species. This
could be done through the installation of a regime of incentives and the
formation of cooperatives to be backed by the constitution.
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ABOUT THE AUTHOR:
Dr. Ogunwusi, Abimbola Adesanya Ph.D (Wood Products Engineering) Faculty of
Agriculture and Enviromental Engineering, University of Ibadan, Ibadan Nigeria
Deputy Director Wood Pulp and Paper Division Raw Materials Research and
Development Council, Plot 17, Aguyi Ironsi Street Maitama, PMB 232, Garki, Abuja
Email:
[email protected]Copyright © IAARR 2012: www.afrrevjo.net 205
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