BÖRJE STEENBERG
The various timber trends studies which have been made by FAO and other bodies over the past 10 to 15 years all agree that the consumption of industrial wood for all purposes and in all regions of the world is likely to increase substantially in the future. Judging from these studies, there is no evidence that wood is on the way out. If this is so, why have I chosen the title "World without wood?"1 It certainly sounds a most inappropriate topic for the Director of the Forestry and Forest Industries Division of FAO.
1 Prepared for the Forestry Development Conference, Wellington, organized in conjunction with the 50-year celebrations of the, New Zealand Forest Service.
But is it really?
Let me first remind you that the forecasts mentioned are in no way a prediction of what will happen. The actual course of consumption will depend not only on the pace of economic development and population growth, but also on the availability of supplies, the availability of substitute materials and the relative price structure.
There are many other assumptions underlying the demand projections, and these must always be borne in mind - but let us for the moment concentrate on those just mentioned. To take them a bit further, we may admit of two possibilities upsetting the realization of the forecasts:
1. inability of wood to maintain enough competitive advantage for the prospects, as we have assumed them, to eventuate;2. inability of the world's forests to meet the growing demand for wood.
To a large degree the first problem is a price problem; the second a quantity problem. Of course, these two factors do interact. They interact according to the demand/supply relationships, and they may also interact in other ways. For instance, an increase in the use of secondary species can materially influence the scarcity problem. The scarcity problem thus contains technological factors. Development of new methods for the use of lesser known species can change the picture just as much as increases in the availability of well-known species. Another case would arise when the value put on a forest for recreational or other purposes by an expanding population may be higher than that put on its value as a wood producer. In this instance the physical supply may be little affected, but the extra costs associated with meeting multiple use specifications may affect the quantity economically available.
However, for present purposes I will take the liberty of simplifying the situation and consider the two factors as independent. We can then consider the problem of the competitive advantage of wood as an industrial raw material in its technological sense. The second factor, availability, then becomes a problem of scarcity of wood which can be technically and economically utilized.
In FAO we are very much concerned with what is possibly the biggest longer term problem facing the world today - the widening gap in practically all respects between the developing and the more advanced countries. As an international organization dedicated to helping overcome or at least narrow that gap, we naturally tend to concentrate on the developing countries. But we attempt to take a global view of forestry and the forest industries. The more economically advanced countries are obviously a very important component of any world picture for wood. Certainly, as things stand at present, if there is going to be a world which can manage without wood because of the development of technology, it is going to become apparent first in these countries. Further, if there is going to be a world without wood because of the pressure of demand, other than wood production, on forest resources, then this is also likely to become first apparent in the more developed countries.
So we look very carefully at the advanced countries for what can be learned from them to benefit the developing countries. In this respect. New Zealand is perhaps one of the most important examples. It is in many respects a model of the type of economy toward which many of the developing countries might, and perhaps should, evolve. New Zealand is a small country - no bigger than many of the newly independent countries whose viability has been questioned on the grounds of size. Yet nobody would doubt that New Zealand has demonstrated its viability. Then, it is clearly a dependent economy - dependent largely on agriculture for export earnings. And so are most of the countries on which FAO necessarily concentrates its efforts. New Zealand has developed a very modern economic and social structure; however, despite - or perhaps because of its high standard of living, New Zealand is clearly having its difficulties.
This is not surprising. There are many examples to show that an economic structure appropriate or even optimum for a certain stage in world economic development can rapidly become outmoded. Diversification is one way of becoming less susceptible to changing circumstances. The New Zealand man-made forest resources and the industries built on them have now become a very important part of the country's efforts in this direction.
The two possibilities on which I have so far concentrated one might also say with which I have been preoccupied - raise questions which bear directly on the future of wood. The questions could be expressed in a number of different ways. Let me choose one of them. What else fills the gap if the world does move toward becoming a world without wood? And here I mean not just the gap left by an insufficient amount of wood in the physical sense, but also the gap as a source of income if wood cannot be produced economically. But are these anxieties reasonable in the light of the projections of our timber trends studies? All these studies show, in effect, that expansion of present uses combined with new uses for wood will be greater than the decline in present uses. FAO is confident that this is a reasonable view of the future for wood but first one or two qualifications must be considered.
Many of the timber breed studies assume that the prices of wood and wood products relative to their possible substitutes will remain fairly constant. This really implies two other assumptions, namely that forest supplies will be adequate and that the rate of technological progress in forestry and forest industries will keep pace with that of the competing industries. The assumption that relative prices will remain constant disregards actually the very situation that could make for a world without wood.
Now this is a very good way of disposing of a complication for analytical purposes. But disregarding the main difficulties does not really get rid of them. Conditions must be created under which it can be assumed with confidence that these problems will not arise. Why then is FAO SO confident?
The way to approach this problem is, I think, to ask another question: Why is material like wood used, why is any material used? The answer is, of course, because of its properties. Properties may be mechanical, like strength, or they may be purely aesthetic, like beauty. In practice, a number of properties is always involved in what might be called the composite value index. This index will have to be compared with the price, and with the prices of alternative choices for the money available which, as we know only too well, is always insufficient.
If there is not enough of a material available at the right price, the price will first tend to rise and eventually man will choose another material, or even invent one, if the properties of the commodity are really that important. Consider the example of a material made from wood - newsprint. Newsprint made essentially from mechanical wood pulp has nearly perfect properties for making newspapers. It is a very good printing medium; it is tough enough to run through the printing press, but stiff enough to maintain its shape for the reader. It is opaque, so that a lightweight sheet can be used without the print showing through. As long as it can be produced at a constant price relative to other materials and in sufficient amounts, there is no need or incentive to develop new products to take its place.
This is one example of the use of wood. If we run through the whole range of wood uses, we shall always find that the properties of wood which make wood products outstanding for certain uses can be expressed as toughness combined with stiffness at low specific weight. There, in a few words, you have the advantage of timber, of plywood, of hardboard, of paperboard and of paper. These are the main reasons why wood is used, and why it will go on being used if the price is right.
Keeping the price tag of wood products constant in relation to other goods is a problem of technology: technology in the forest industries, technology in logging and transport, and technology in forest management. The question now is this: Is there sufficient technology and sufficient science for forestry and the forest industries to keep developing at a high enough rate to maintain a constant level of relative prices?
The point is often made that, in research and development, forestry and the forest industries lag far behind some of the more vigorously competing industries and some similar fields such as agricultural science. If we take the number of patents as an index, then it is undeniable that in the field of forest industries this is very small indeed in relation to the size of the industry, and very much smaller than in many other fields of technology. Even on the scientific side the number of researchers in relation to the turnover of the industry is rather small. There is also no doubt that in forestry the research carried out at centres of higher forestry education, as measured by the output of scientific papers, lags in volume far behind that in other scientific fields.
On these terms the case that there is insufficient research and development behind forestry and the forest industries may appear to be proved. But how serious is all of this?
We all know of the tremendous scientific and technological advances in the field of plastics and the competition that these are now providing for forest products in the field of packaging, for instance. And the price of plastics is still decreasing fast.
The world's steel industry is also exploding. Over the next five years, it will produce about as much steel as there has been made in the past history of mankind. The use of stainless steel has been hampered by a lack of nickel. With the expansion of nickel production arising from the new discoveries in Australia and other countries, it could well be asked where structural timber will stand.
This is obviously no time for complacency, but I continue to have faith because technology has never been the limiting factor in the development of society. Technology can provide all that is needed and even more than we can handle.
If the basic commodities of life could not be produced at prices more or less constant in real money terms, there would have been no place for all the new things that have been invented. The prices in real terms of fundamental things like cement, power, oil, or ship's tonnage, have on the world scale gone down, as have the prices of a number of other commodities. It is this that has made it possible for things like television to find a place.
If we look at research as measured in terms of patents, numbers of scientists or output of scientific papers in cement, power, shipbuilding, etc., we also find that these fields are not outstanding. But there must have been progress in technology to have enabled these industries to manufacture at relatively constant prices.
It seems to me that there are at least two aspects here which can be applied to forestry and forest industries. The first is this: the real point about mature industries is that they do not worry about patents. Patents are useful when one is trying to stake out a claim to economic territory. But when one is producing goods for an existing and expanding market, one can work together with other manufacturers, because everybody has the common interest of keeping the market growing. It is important to be in the market, not out of it. The patented product is a speciality which may or may not find a place in the sun. Until it does, it is not yet in the market.
In such a market, technological development goes on through cooperation between the various manufacturers in an industry. This is a very economical method of development. There is little duplication of effort, but there is maximum exchange of information. Such an economy is found not only in forest industries; it applies equally to forestry. Where else would you find a forum like the Regional Forestry Commissions within FAO, or the Commonwealth Forestry Conference, for the exchange of views and information and for the coordination of international policies at the highest level? The International Union of Forestry Research Organizations does the same for research with maximum efficiency and the minimum secrecy.
The second point is this. Mature industries can draw on developments in many different fields, all the way from materials and science to instrumentation and computerisation. It is possible, therefore, for forestry and the forest industries to keep pace with general technological development by selecting and adapting results from many fields. This is as true for the older forest industries as it is for the newer; as true for operations in the forest such as harvesting and planting, as it is for research. This means that research can concentrate not on new inventions, but on ways of increasing operational efficiency, including the scale as well as the methods of production.
A mature industry therefore gains certain definite spin-off benefits from the technological progress in other industries. The biggest problem is to ensure that it does not become a senile industry.
If these lines of contact and these methods of work can be maintained, it should be possible to continue to keep up with development in the glamour areas - areas where the economy of research and development is much lower. But, to be able to get the most out of working in this way, each part of the world must carry its share of the job. From that point of view the new buildings soon to be opened at the Forest Research Institute at Rotorua, and the proposals to establish a forest industry research association show that New Zealand, at least, is awake to its responsibility.
We now have some basis for believing in the future of wood. The versatility of wood as a raw material combined with the inventiveness of man, to my mind lay solid foundations for the future of production forestry.
The use of wood has changed and will continue to change. It is only a hundred years since the way was found to make paper from wood. Rayon from wood pulp has been made on a large scale only since the 1930s. The man who introduced cellophane is still actively at work. Dr. Asplund, the father of the main part of the world's wallboard production, is still looking through his microscope. Ten years ago, few people had even heard about particle board, now a product produced in quantities surpassing that of wallboard. I am sure that we have not seen the end of these developments.
By interlocking the different uses of wood it should be possible to obtain economies hardly ever visualized for materials with a single use. Wood is a raw material for joint industries. By complete utilization of the wood it should be possible to obtain products of widely varying nature with widely varying markets on which to build a stable wood economy. The problem here again is one of cooperation - cooperation between the specialists in each use of wood, cooperation with the economists, and above all cooperation with forest management.
Why forest management, above all? The reason is this. Even if the forest industries do keep their development in line with that of other industries, they can still be priced out of the market if the raw material becomes too expensive.
The price of wood as a raw material is essentially determined by the cost of harvesting and transport, and the cost of forest management. Part of this problem is technology, and by technology I mean not just machinery, but the economics of using it. If forestry is not to price wood out of the market, I am sure that it is necessary to inject a more positive orientation toward the economic basis of forestry in its relationship with industry and the community. Admittedly, there is much more mention of economics and much more discussion of the relevance of economic considerations in the forestry of the world today. But it must be more than a superficial juggling with economic and technical vocabularies.
In the same way, the forest industries and their technologists must get a deeper insight into the unique material they handle. It is a biological material, and to get the most out of it requires a deeper knowledge of the biological processes involved in growing wood.
I have great admiration for the unique way in which foresters and workers in forest industries cooperate with one another. I would like to see the same spirit emerge between the two groups. In fact, I am convinced that it is absolutely essential for them to participate jointly and effectively in frank interchange of objectives, policies, resources, limitations and problems. Since its inception FAO has considered forestry and forest industries as an inseparable entity.
To return to this last possibility of pricing wood out of the market. Let us assume that there does come a time when there is not enough wood available. Then the price will increase and man will be forced to find another way out. We are now dealing with the pure scarcity factor.
Undoubtedly there is still a lot of forest land in the world. But there are many qualifications which must be applied to any evaluation of forest resources by area. In some of the developing countries in particular, agriculture will for some time continue to reduce the forest area and insects, disease and fire will continue to take a fair share of it. The inroads from these sources in the more advanced countries are probably more under control, but other factors operate which could be even more far-reaching in the long run. Transport, communications and housing are prolific users of space.
More affluent communities are gradually being persuaded to place a higher value on large areas of undisturbed forest than they do on the wood products they forego.
Somewhat over half of the world's present forest area is in the tropics but much the greater proportion of the rising demand anticipated is in terms of the products of the temperate zone of forest. The possibility of the temperate forests becoming unable to meet the increasing demands on them might, from the world view, be regarded as a good thing in that the gap would offer widening markets for the forests of the developing countries. But we come back again to the same two provisos - that the competitive advantage of wood remains such that woods of the tropics are then the best substitute for temperate woods, and that the remaining forests in the tropics will be adequate to fill the gap.
One answer to this question of scarcity is that forests are not merely a renewable resource; they are a multipliable resource. If a rise in demand is anticipated far enough in advance, we can plan to place a forest of the right size and of the right type in the right place to meet it. But if we knew what were the right place, the right type and the right time, I sometimes wonder how often we would make the best use of our knowledge. There are still far too many examples in the world's forestry programmes of industrial plantation sites being selected on the criteria of volumetric growth rates and optimum forest site suitability, rather than on minimum delivered wood cost.
My point is that we cannot assume that the conditions or the provisos will automatically be met. We must do something to make them occur.
Few countries have yet been forced to face the facts of forestry life as urgently as has New Zealand at the present time. Forced by changing circumstances to develop its forestry and forest industries sector as one of the major bases for its economic future, New Zealand must find answers to the questions posed. Any contribution made toward solving New Zealand's problems in this respect could well be a pioneer contribution to solving problems which will become of major significance in world forestry.
