14th February 2017

FORESTSUSTAINABILITYof

Ms. Surapa RuthirunkornBusiness Planning managerThe Siam Forestry Co.,Ltd.

IN THAILANDINDUSTRY

FOREST INDUSTRYAGENDA

SUSTAINABILITY of

- Supply chain management in forest industry (Beginning plantation to our customer )

- Balancing Sustainability of forest industry (Economy Society and Environment)

- Matching economy and agricultural tradition (Increasing value-added in agriculture Ex. Planting eucalyptus on paddy , planting on riverside and planting on flood plain areas)

2

FORESTThe Heart of economy

SUSTAINABLE RESOURCE3

Seedling

Plantation Log Pulp Mill

Bio mass

SUPPLY CHAIN MANAGEMENT

Paper Mill

Packaging plant

Kraft paper

Packaging

Printing &Writing

paper

Dissolving Grade Pulp

Textile

Food Packaging

FOREST INDUSTRYSUSTAINABILITY of

4

Organic Fertilizer

NE site: 27,200 haSeedling : 34 million

North site:8,320 ha Seedling : 10.5 million

West site:3,920 haSeedling : 4.9 million

FOREST INDUSTRYSUSTAINABILITY of

PLANTATION AREAS3 sites in Thailand

5

SFT Demand (Domestic +Export)

CONSUMPTIONFOREST INDUSTRY

SUSTAINABILITY of

6

2.00

0.28

2.282.35

0.53

2.88

0.00

1.00

2.00

3.00

4.00

domesticconsumption

wood chip export total

M.GT

2015 2016

Biomass for energy(wood pellet)

wood pallet

Fibrous Material

Size <2.0 inch

Size 2.0-6.0 inch

Size >6.0 inch

FOREST INDUSTRYWood Procurement - BUY WHOLE TREE

Wood Chip Pulp

SUSTAINABILITY of

7

FOREST INDUSTRYSUSTAINABILITY of

FSC

8

BALANCING SUSTAINABILITY

Balance in economic, environment and community

SFT apply forest management with own plantation  (area 1,600 Ha.) and our contract farming member (3,200 Ha.) 

FOREST INDUSTRYSUSTAINABILITY of

FSC-control wood

9

BALANCING SUSTAINABILITY • SFT was certified FSC‐CW Controlled Wood Standard  &  FSC –COC Chain of Custody  by SCS Global Services (Indonesia)

• This Certification for Chumphuang & Prayuenwood chip plant & 6 alliances wood chip plants. Capacity 500,000 ‐600,000 GT/yr.

• 2017:  Plan to certified for FSC V3‐0 & add more wood chip alliance &  pallet business.

FSC CW/COC V2‐1 

625933

1866

25452900

2565

20922283

0

500

1000

1500

2000

2500

3000

3500

2008 2009 2010 2011 2012 2013 2014 2015

'000 BDMT

Thailand wood chip export wood chip export

FOREST INDUSTRYSUSTAINABILITY of

10

Structure change from plantation to line plot (small scale farming) 

39% 34% 39% 32% 28% 29% 28% 29% 30%

61% 66% 61% 68% 72% 71% 72% 71% 70%

0%

20%

40%

60%

80%

100%

120%

2011 2012 2013 2014 2015 2016 2017 2018 2019

% portion% portion of SFT wood supply

line plot (riverside,paddy field) plantation

line plot area increasing form gain more benefit than plantation 

Wood SupplyStructure Change

source: Risi

CONTRACT FARMINGFOREST INDUSTRY

SUSTAINABILITY of

Plantation and Flood plain areas

Paddy field (line plot)

Irrigation ,Riverside(line plot)

1

2 3

The trend of Small plantation (2,3 line plot) increase every year

70%

30%The trend of Big plantation (1) decrease every year

11

How to?

FOREST INDUSTRYSUSTAINABILITY of

ECONOMY and AGRI-TRADITION River(Flood plain) and Paddy areas

Source : Office of Agricultural Economics

> 320,000 ha

128,000 - 320,000 ha

32,000 - 128,000 ha

< 32,000 ha

25 Main watershed254 Sub watershed

Watershed areasN : 1,383.7 haNE : 1,666.8 haC : 1,349.1 haS : 721.0 ha

Source : Water Watch and Monitoring System 

12

FOREST INDUSTRYSUSTAINABILITY of

2 SUCCESSFUL MODELS“KAMPHAENGPHET MODEL”Planting on riverside

“DIN TAM MODEL” Planting on riverside or flood plain areas

- Since 2005 - 2015- Riverside length 5,044 km.- Areas 32,282 ha- Ping watershed- Contract farming - Farmer income 2,787.80

baht/ha

- Since 2013 - 2016- Areas 4,473 ha- 3 province (Mae Khong watershed)- Contract farming - Farmer income 1,518.80 baht/ha

13

FOREST INDUSTRYSUSTAINABILITY of

Key Success“DIN TAM MODEL” Planting on riverside or flood plain areas

Riverside

flood plain areas

flood plain areas

Product InnovationTechnology PlantingTechnical ServiceSupply Chain ManagementForest Sustainable Management

Department of Agriculture

Ministry of Interior

Farmer

COLLABORATION

14

15

ภาพประกอบ ดนิทาม FOREST INDUSTRYEucalyptus in Flood plain area

Product InnovationTechnology PlantingTechnical ServiceSupply Chain ManagementForest Sustainable Management

FOREST INDUSTRYSUSTAINABILITY of

Key Success

Department of Agriculture

Ministry of Interior

Farmer

COLLABORATION

“KAMPHAENGPHET MODEL”Planting on riverside

Riverside Riverside

Riverside

Supply Chain Management16

FOREST INDUSTRYSUSTAINABILITY of

Product Innovation

-Testing since 2001-2016-There are more than 250 plots for Clonal Test Thailand-In 2016,There are 7 clone commercial

Traits for Eucalyptus Improvement

-Volumetric yield ,Pulp yield, Wood density-Adaptability (Calcareous soil, Drought, Saline soil ,Flood areas, Riverside and Paddy field)-Gall insect tolerance-Disease resistance

CLONAL TEST

CLONAL TEST

Breeding Clonal Test Propagation

17

FOREST INDUSTRYSUSTAINABILITY of

BALANCING SUSTAINABILITY

18

Environment

Economy

Society-low labor mobility.-Increasing value-added in public land.

-Farmer income increase.-Community income increase.-Government reduce expenses

-Reducing utilization from Natural Forest.-Reducing deforestation.-Increasing O2 .

YOUR ATTENTIONforTHANK YOU