WOOD producers appealed to the government to curb the smuggling of substandard plywood from China as it would compromise the viability of the local industry and consumer welfare.

Officials of the Philippine Wood Producers Association (PWPA) made the appeal after they received reports that 300 40-foot container vans were brought into the country in April, while an estimated 400 to 500 containers would have arrived in the Philippines this month.

“While we need to contend with lower profit margins due to increasing production costs, we also have to deal with the problem of smuggling,” said PWPA deputy director Maila R. Vasquez in a briefing in Pasig City on Tuesday.

Vasquez noted that smuggled plywood from China forces local plywood producers to bring down their prices so they can go head to head with cheaper but substandard plywood being smuggled into the country.

The PWPA sought the assistance of the Department of Trade and Industry (DTI) to carry out a “more active” market-monitoring program with the participation of its industry technical representatives.

“Through this measure, the industry hopes to help in the enforcement of mandatory standards, and in the process, slow down the flood of substandard, smuggled imported Chinese plywood in the market,” the PWPA said in a statement.

The PWPA noted that plywood is covered by mandatory standards and local manufacturers are subject to the monitoring of the Bureau of Product Standards (BPS), with local plywood required to be marked with the PS label.  

Imports are required to obtain ICC (import-commodity clearance) from the DTI.

“Industry verification with the BPS, however, reveals that almost all of the imports have not declared their products as such, nor complied with the ICC rules,” the PWPA noted.

Locally manufactured plywood is easy to identify and differentiate from imported Chinese plywood. Chinese plywood is 5-ply and of 4.5 millimeter thickness but usually misrepresented and sold as 5 mm thickness.

“They have external veneers that are unacceptably thin, usually no thicker than 0.25 mm.  These panels are also not sanded and are rough because they cannot bear sanding; the thin veneers will be sanded away.  The glue used in this plywood has high formaldehyde emissions that also pose health hazard to consumers and builders as well as construction workers,” said the PWPA.

“Most, if not all, of these imports reportedly have not paid the right taxes as the goods are either misdeclared, or worse, outrightly smuggled into the country. It has become common industry knowledge that container vans of plywood are being withdrawn from the international ports for a ‘fixed fee,’ depriving our government of hundreds of millions of pesos in taxes and duties,” the group said.

There are over 30 plywood mills in the Philippines that directly employ over 30,000 workers. The PWPA said based on trade statistics, 16 local workers lose their jobs for every container of plywood smuggled into the country.