March 22: The timber trade in the Kallayi belt of Kerala, once the largest trading area in Asia and the second largest in the world, is now facing extinction with timber dealers attributing the crisis to a variety of factors. They blame the dwindling forest reserves, nationalisation of forest areas, the Supreme Court ban on clear felling, the stagnation in the construction industry and a shift to concrete houses for their current plight."There were times when people from Mumbai queued up before us to finalise a contract even before we used to get timber from our sources. Now, even if sawn timber is sent to Mumbai, we often hear buyers from there complaining about measurement," says Timber Merchants Association secretary Jayarajan.
The Kallayi belt, spread over around 35 km on both sides of the Kallayi river in Kozhikode, is now a poor shadow of what it was earlier. "Even in 1996, we transported timber to Mumbai on a large scale. Since then, the industry has been witnessing a swift decline."
Unlike manyother places in the state, Kallayi had been the centre of timber trade in India owing to the high level of salinity in the area which made the quality of the timber, seasoned in saline slush here, well above that of the other centres in the country. Added to this was the easy access to the river for transporting timber to the sawing centres.
While traders here had once been the major suppliers to different parts of the country and even to Japan, Italy and Germany, they have to be satisfied with meeting local demand now. The stagnation in the construction industry in Mumbai and Pune has caused a steep fall in transport of timber to these centres. "We used to transport on an average of 25 loads of sawn timber a day to these cities earlier. Now we send just two or three loads," said Jayarajan.
Timber exports through Beypore port have witnessed a steep fall over the last six years. For instance, exports, which stood at 7,878 tonnes in 1991-92, fell to 3,784 tonnes in 1992-93 and further to 3,553 in 1993-94.Though it recorded a three-fold increase to 11,774 tonnes in 1994-95, exports dropped to 11,237 tonnes the following year. The worst performance was in 1996-97 when it touched a low of 603 tonnes.
Along with the stagnation in the construction industry came the Supreme Court ruling on December 12, 1996, which said that the running of saw mills of any kind, including veneer or plywood mills, was "prima facie violation of the provisions of the Forest Conservation Act, 1980" and "every state government must promptly ensure total cessation of all such activities forthwith." The court also ordered that there should be a blanket ban on the movement of cut trees and timber from any of the seven north-eastern states to any other state of the country either by rail, road or waterways. This has resulted in a virtual stoppage of timber coming from Nagaland, Arunachal Pradesh and Assam to the state.
Adding to the woes of the industry there has been a shift in preference among local consumers to the construction ofconcrete houses. One of the reasons given is the increasing cost of timber. On an average, even a large house uses only around 50 cubic meters of timber these days, say timber merchants. Traders put the blame squarely on the government as the confirmation price of timber at government depots is revised monthly at the time of auctions.
After timber arrivals from the other states stopped, traders had to depend more on state government depots. The confirmation price is fixed on the basis of the average price of the last six months. As a result, there is a price increase every month. The confirmation price of one metre of C3 teak procured from Kulathupuzha in south Kerala increased to Rs 24,500 in November 1997 from Rs 23,000 in August 1997 and further to Rs 25,100 in December 1997. As a result, the number of bidders are very few.
The industry is also sourcing timber from Malaysia, Nigeria and Burma. Though cheaper than the wood procured from the state, there are not many takers for this variety, the mainreason being that it lacks in oil content and colour. However, it gives more outturn to the traders. The outturn of foreign timber is 85 per cent when sawn, as compared to 60 per cent in the case of indigenous timber. Despite this advantage, traders feel procuring foreign timber is no easy task as it is imported by big traders at ports like Tuticorin and Mangalore and has to pass through many hands.
Traders feel that the industry, which employs nearly 10,000 people in 50 big mills and 120 small mills in the Kallayi belt alone, can be saved if the government slashes sales tax on timber and firewood. The state government has fixed the tax at Rs 12.5 per cent in the last budget. They argue that firewood is fuel and and the tax for fuel is only one per cent.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
