Sojitz

Introduction Main Web Site	Sojitz, which comprises the businesses of Nissho Iwai and Nichimen, is a large (financially troubled) integrated trading and investment company. Its annual revenue in 2003/4 was Yen 6 trillion (cUS$ 50 billion). Together with its numerous subsidiaries, affiliates and investments, Sojitz's business interests are world-wide and include most market sectors - particularly logs and lumber, wooden building materials and wood chips. The ownership stake of Sojitz (as Nissho Iwai) in highly controversial Indonesian pulp and paper company Asia Pulp and Paper along with Sojitz's heavy involvement in sourcing timber from Indonesia, Papua, Russia and other regions where illegal and unsustainable logging is endemic, make this firm perhaps the leading target among trading companies for pressure groups.
Businesses Dealing in Products Based on Tropical Timber	Relevant enterprises include: Dallesprom (/Flora), Kohoku Veneer (plywood manufacturer), Nichimen, Samling, Subsidaries and Affiliated Sojitz Housing Materials Corporation PT Mitra Mutiara Woodtech, Sojitz Forest Products (based in Sabah), Sun Building Materials Corporation Sojitz (through Nissho Iwai) has received Japanese government support for its logging operations in Papua New Guinea, where it has been one of that country's largest logging companies (accounting for over 200,000 cubic metres annually during the second half of the 1980s - roughly 15% of Papua New Guinea's log exports). Nissho Iwai remains one of the leading traders of logs from Papua New Guinea.  It may be that some of this is supplied by Samling (or its associate company Concord Pacific), whose reportedly illegal operations in Papua New Guinea's forests include road building. Nissho Iwai was also a major importer of logs from the Philippines.[ref: "Timber from the South Seas - An Analysis of Japan's Tropical Timber Trade and its Environmental Impact" by F Nectoux and Y Kuroda for WWF (1990)] The company's imports include South Sea (i.e. tropical / SE Asian) logs [ref: Japan Lumber Reports (20 December 2002)] - at least some of these may be traded through Nichimen (East Malaysia), Sojitz' wood products subsidiary in Malaysia. Core staff of the now bankrupt company Nippindo - a joint venture of Kanmatsu and Apkindo which had a monopoly on plywood imports from Indonesia between 1988 and 1998 - have been absorbed into Nissho Iwai Housing Materials.[ref:  Japan  Lumber Journal (11 March 2005)] Sojitz owns the majority of a joint venture with Dallesprom and Evraz Holdings[ref: Japan Lumber Report (24 December 2004)] (one of Russia's largest steel makers) - which bought out the shares owned by the Khabarovsk authorities.  The venture produces veneer from 0.2 million m3 of logs (supplied by Dallesprom, a large timber company which is known for poor standards of forest management) for export to the Seihoku group.[ref: Japan Lumber Reports (9 April 2004)] With others, Sojitz annually produces 0.5 million tonne of wood chips in Vietnam[ref: Japan Lumber Reports (14 June 2002)] for export to Oji Paper in Japan from tree farms which conflict with local people and which might be environmentally and financially unsustainable.
Scale of Tropical Timber Trade	Sojitz, Japan's largest timber importer, supplies more than (2.4 million cubic metres) c20% of Japan's total log imports. It is also Japan's largest distributor of timber (notably logs, sawn wood and plywood). Given that the great majority of the plywood which Japan imports is supplied from Indonesia and Malaysia (perhaps including Free Ports which Malaysia's authorities choose not to police), the likelihood that this contains illegal timber is sufficiently high for prospective buyers to assume that plywood imported by Sojitz might be illegal unless otherwise certified. Through its part ownership of Lingui Developments, Sojitz has a significant interest in Samling, one of Sarawak's leading logging and plywood milling companies. Given its size and resources, Sojitz is well placed to determine whether the logs consumed by those of Samling's mills which supply plywood to JAS standards are legal and could use a credible certificate of legality to promote those mills output. Samling is the only major logging company in Sarawak to express an interest in the MTCC (Malaysia Timber Certification Council) scheme. If Samling is confident that the chain of supply (to forest origin) of all the wood raw material (including that which is a by-product of the production of sawn wood, plywood etc) which it uses in manufacturing fibreboard contains no illegal timber (e.g. from Indonesia), then it should certify that chain of supply. Doing so would not only add value to Samling's fibreboard production but also eliminate the concerns of those who trade in or use that fibreboard. During 2000, Sojitz (as Nissho Iwai) imported a roundwood equivalent volume of c200,000m3 of Russian sawn wood and (as Nichimen) c100,000m3 of logs.  The company claims to be  Japan's leading importer of Russian (and American) sawn wood. In recent years the business of Sojitz (as Nissho Iwai) in China was the destination for an annual average of c60,000m3 of logs from Papua New Guinea.
Policy on Use of Tropical Timber Products	The company's environmental report for 2004 appears to be available in Japanese only in its Web site and does not contain details of targets or policy towards forestry or timber sourcing. Sojitz may appears to imply that, because it has FSC Chain of Custody certificates for at least one of its supply chains for each of logs, forest products and wood chips, then all its log, forest product and wood chip trade is so certified. The environmental policy of Nichimen seemed to suggest that its businesses should comply with whichever laws, standards, and the like its Global Environment Committee chose - rather than all laws. Requiring certification to FSC or equivalent quality (which take into account the legality of production and chain of supply) as standard for all (not just a few) of the wood-based products which its businesses trade (to Japan, China and elsewhere) would boost the credibility of this environmental policy. Nissho Iwai considers that establishing plantations in Australia and Vietnam are environmental operations. Nissho Iwai rightly considers that merely abiding by laws is insufficient to minimise global environmental degradation.
Contact Details within Company	Address unless otherwise shown: Sojitz Corporation Kokusai Shin-Akasaka Building, 6-1-20 Akasaka Minato-ku, Tokyo 100-8655 Japan 'phone: +81 3 5200 5000 Mr Akio Dobashi President and Chief Operating Officer Mr Takeshi Yoshimura General Manager Public Relations Department 'phone: +81 3 5446 1061 Mr N Mita President Nissho Iwai Housing Materials Corporation 5-8, Imabashi 2-chome, Chuo-ku, Osaka 541-8558 Japan 'phone: +81 6 6226 5655 fax: +81 6 6226 5699 Mr Mamoru Sato President Forest Products & Building Materials Division Mr Yoshimi Ota President General Commodities and Consumer Division Mr Koji Kiriyama Manager, Log Marketing Section Chemicals & Housing Materials Company 3-1, Daiba 2-chome, Minato-ku, Tokyo 135-8655, Japan kiriyama.koji@nisshoiwai.com