Even the Turks are stealing our forest: Natron Hayat got a more favorable wood price to the detriment of domestic producers

There is still no clear strategy on how to improve and protect the forestry sector in the Federation of Bosnia and Herzegovina. Although we often hear that Bosnia and Herzegovina is rich in forests, it should be noted that only one third is usable for furniture production. If we add to this the problems of illegal logging, i.e., theft, and insufficient reforestation, it is clear that the Federation of Bosnia and Herzegovina faces complete devastation of its forest wealth.

Experts and furniture manufacturers believe that if the forestry sector in the Federation of Bosnia and Herzegovina were regulated through the adoption of a law, the state would benefit the most. The President of the Furniture Manufacturers Association, Ramiz Grapkić, said in an interview with the Patria agency that general lawlessness has prevailed in this area for a longer period, which negatively affects domestic furniture manufacturers.  

- The Law on Forests has been on hold for several months, and the old law has been repealed. Because of this, furniture manufacturers suffer the greatest damage, as they are forced to pay a high price for raw materials, and in fact, they import most of them from Slovenia or Croatia. If this situation continues, the operations of numerous furniture factories that employ hundreds of workers will be jeopardized. The positive trend of hiring new workers could soon be halted – says Grapkić.

Domestic manufacturers are export-oriented, primarily towards Europe, because that market has a need for furniture from Bosnia and Herzegovina, both due to price and quality.

- In Bosnia and Herzegovina, we have unfair competition. There is a lot of furniture sold on the black market, and a large number of people work illegally in companies. Those who operate properly and fulfill all obligations towards workers and the state have had to turn to exports – says Grapkić.

Furniture manufacturers in the Federation of Bosnia and Herzegovina have a major problem with the procurement of raw materials. For example, factories in Croatia have contracts with Hrvatske šume (Croatian Forests) for ten years with clearly defined prices. Similarly, Croatia has established criteria for the distribution of raw materials based on the degree of finalization, thus protecting domestic producers.

In the Federation of Bosnia and Herzegovina, the picture is completely different, and the main problem is corruption in forestry.

- In every forestry company, there are criteria for how raw materials are allocated, but no one respects them. We are forced to import raw materials. We would objectively have the opportunity to grow, but since forestry companies distribute logs according to their own views, not respecting any order, we are forced to obtain raw materials from abroad and at high prices – says Grapkić.

He points out that the Association initiated the adoption of a decision that would favor final producers. The state would also benefit from this.

- In furniture production, this would create 10,000 new jobs. Each job in the wood industry creates another job. We did not find understanding. The political climate is such that our good ideas have not been realized.

Natron Hayat in a favorable position

On the other hand, while domestic producers have a series of problems, others are being accommodated. Thus, the Turkish company Natron Hayat (Maglaj) was provided with the price of pulpwood, which is the cheapest in the region.  

The price of logs used by final furniture manufacturers is the highest in the region. Although forestry companies suffer due to the price of pulpwood, they compensate for this through the prices of raw materials for final producers.

Another problem is the export of firewood, through which good raw material is extracted. Data for 2015 show that 700,000 cubic meters of wood were illegally exported, and first-class beech is cut for firewood. It should be noted that one beech tree binds 400 liters of water below its roots. Wood absorbs carbon monoxide from the air and produces oxygen. Just four beech trees can produce enough oxygen for a person who lives 80 years.

From the Association, they believe that only through proper protection and regulation of this area can the state also benefit.

Examples from other countries

Countries in the region have created clear concepts to protect domestic producers. For example, Montenegro has banned the export of wood from state forests, and charges 10 euros per cubic meter for exports from private forests. Croatia does everything to protect its producers. 

Albania has banned logging in state forests for ten years. In Romania, processors can only buy 30 percent of the necessary raw materials from state forests.