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Indonesia's plywood industry operating below capacity.

The country's plywood industry is operating only at 70% of its installed capacity as a result of shortage in supply of log raw material., producers said. Deputy chairman of the association of wood panel companies (Apkindo) Abbas Adhar blamed the government policy of reducing logging quota for the poor performance of the plywood industry. The government, concerned with preserving the country's tropical forests, reduced logging quota to 5.7 million cubic meters this year from 6.89 million cubic meters in 2003. Adhar said some plywood producers have to reduce their production capacity by 30%-50% because of the decline in log supplying capacity from production forests. He said plywood industry is the hardest hit by the policy as the industry depends much on natural forests for logs. Other forest based industries like pulp and paper industry could rely on plantation forests.
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Title Annotation:Economic News In Brief
Publication:Indonesian Commercial Newsletter
Article Type:Brief Article
Geographic Code:9INDO
Date:Aug 17, 2004
Words:142
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