Up to 70% of timber traded from the Amazon could be illegal with new research reporting that 15% of all (supposedly legal) forest management plans contain irregular logging credits helping to fuel illegal timber.
Published in April, Characterization of Technical and Legal Irregularities in Management Plans in the Brazilian Amazon, researchers analysed 184 forest management plans in the Amazon, most of them located in the states of Pará (88) and Rondônia (37).
“I’ve always worked inspecting forest management plans, and I’ve seen many brutal irregularities,” according to lead author Vinicius Otavio Benoit Costa, an analyst with Brazil’s federal environmental agency, IBAMA, who spoke to Mongabay. “There are a number of very serious frauds, up to and including the formation of gangs and criminal organisations involving forest management.”
According to Mr Costa, the plans come from the eight states connected to the Brazilian section of the Amazon, covering 746,000 hectares of forest management and more than 4.1 million cubic metres of round wood.
And when it comes to the most common irregularities, Mr Costa found that 72.8% of the forest management plans (which have timber credits—or about 20% of total plans) presented a fraudulent movement of logging credits. He said this is closely associated with timber laundering, now the third most lucrative business for organised crime.
In Brazil, he said, all logged timber must be supported by forest origin documentation (DOF), which produces a timber credit. Once authorities approve a forest management plan, the owner can issue a certain number of DOFs corresponding to the volume of trees extracted from that area.
“Without credit, the wood can’t reach the consumer centres,” Edevar Sovete, an environmental analyst at IBAMA, told Mongabay, who said that given the DOF’s significance, crime syndicates are now specialising in getting approval for forest management plans in areas where they don’t necessarily intend to log.
“They then sell the newly generated timber credits to loggers targeting areas where logging is forbidden,” according to Mr Costa’s research, who adds that “by attaching the genuine credits to the illegal wood, they can thus launder the timber into the legal supply chain.”
Wood Central understands that a significant portion of this illegal timber ends up in Europe – particularly as ipe used in hardwood decking and stairs – and also in the United States, where FACT Coalition last year published “Dirty Money and the Destruction of the Amazon: Uncovering the US Role in Illicit Financial Flows from Environmental Crimes in Peru and Colombia“, analysing links between financial secrecy and crimes in the Amazon.
“That tree listed in the inventory as an ipê was actually a chestnut tree that generated 30 m³ [1,060 ft³] in credits from a species with high economic value,” according to Mr Costa’s research, adding that fraud also occurs during transportation of the wood. Mr Costa analysed IBAMA inspection records describing heavy logs transported by motorcycles or trucks travelling at unrealistically high speeds – a sign that something wasn’t right.
In one case, he calculated that a loaded truck would have had to travel at an average of 190 kilometres per hour to cover the distance between the logging site and the sawmill.
“It is a fraud,” “No timber was sent, only the credits.”
Vinicius Otavio Benoit Costa, an analyst with Brazil’s federal environmental agency
Why Brazil’s illegal timber flow is a headache for EUDR
Last year, Wood Central revealed that the Netherlands amongst the more vocal critics of the current EUDR enforcement timelines—has emerged as one of the European countries most impacted by the push to establish the European Union Deforestation Regulation.
That’s because the Dutch are the largest importer of deforestation-linked products, with a surge in wood and wood-based products from China and…Brazil.
According to Statistics Netherlands, the country’s shipping ports are Europe’s busiest for timber from locations at risk of deforestation. The largest share came from Brazil, where large timber and soy imports accounted for 3.2 billion Euros in 2022 alone. It also reveals that the Dutch are the largest importer of soy, palm oil and cocoa and, most significantly, the region’s second-largest importer of wood products.
As a popular trading route for European and global markets, 95% of Europe’s most lucrative markets are within 24 hours of Amsterdam or Rotterdam. “Add to that its supportive legal and tax structures and logistics and technology infrastructure, and it’s no wonder the country is among the top business locations according to the Institute for Management Development’s World Competitiveness Ranking.
Since 2002, the Dutch trade in wood from non-EU countries has boomed, with imports doubling over the past 20 years (125%), followed by cocoa (67%), beef (+53%) and palm oil (+19%).