Group Certification Service Network

Certification as a forest management, marketing and networking tool

The vast majority of community eco-forestry enterprises in PNG will need a certain level of ongoing outside support. The reason for this is that it is very difficult and/or costly for these small businesses to obtain loans for equipment or other investments (e.g. access road construction), organize timber transport, have a good spare parts supply and repair service, get good business development support, etc. FORCERT creates the possibilities for these essential support services to be part of business agreements under its Group Certification Service Network.

FORCERT uses Forest Stewardship Council (FSC) certification as a management and marketing tool, but also as an incentive for producers, central yards and buyers to communicate and work together, ensuring a sustainable production that gets a fair price.

For small forest enterprises to meet FSC certification requirements is quite difficult and the costs of becoming certified are high; they have to comply with international standards and organise and pay for an independent auditor to assess their forest and business operation. That's why FORCERT is managing a so called FSC Group Certificate. Together with its partners and a wide range of other stakeholders, FORCERT has developed a simple group certification system. Individual small-scale producers that meet the set group certificate standards can become group members. The costs of managing the group certificate are shared between the members, who pay an annual fee, plus a small levy per cubic meter on all certified timber sold.

Certified timber needs to be able to be followed down the "marketing chain", from the forest it was produced all the way to final buyer of the timber product. This "chain of custody" guarantees buyers of certified products that the timber used did come from well managed forests. Therefore any trader in certified timber is required to maintain their own Chain of Custody certificate. FORCERT also manages a group Chain-of-Custody certificate and offers membership to a number of selected small central timber yards (Central Marketing Units or CMU's), to which certified producers can sell their timber. Like the Producer members, CMU's pay an annual fee and a levy per cubic meter sold.

The FORCERT Group Certification Service Network

The FORCERT Forest Management and Chain of Custody group certificates are combined under the Group Certification Service Network. This network links community based producers with central timber yards (Central Marketing Units; CMU's) and those yards with committed overseas buyers. Producers give the guarantee of producing and supplying a certain annual volume of quality timber to the CMU. The CMU in return will assist the producer in organizing timber transport, supplying spare parts and technical back-up services and contacting financial institutions to obtain loans.

FORCERT helps its CMU's to market their timber by combining the output of all CMU's. This is necessary to get sufficient timber volumes of the various species to be able to make good marketing deals with selected overseas buyers of FSC certified timber and allow FORCERT to develop a premium market for a wide range of species, including so called Lesser Known Species (LKS). The basis of FORCERT's marketing strategy is the species availability in the producers' forests. For its market development and promotion FORCERT collaborates with organisations experienced in promoting FSC timber both in PNG and in the exporting countries selected in its marketing strategy.

The FORCERT marketing strategy is aimed at accessing so called "niche markets". These are small, specific timber markets, with end users interested in buying certified timber at a good price and willing to try out new, lesser known species. The overseas buyers FORCERT has selected are aimed at developing and supplying niche markets in Australia and Europe.

One of the FORCERT Group Certificate membership requirements for CMU's is that they have to let Producer members know what prices they are getting from the overseas buyers for the various timber species. The CMU's also have to give a clear overview of the costs they make to export the timber. In that way Producer members can check if they are receiving a fair price for their timber. FORCERT monitors the CMU's on this important transparency requirement, and also negotiates with all the CMU's, to help ensure Producer members get the best possible price for their product.

FORCERT group certification service network structure