KUCHING: The Sarawak Government has approved a 50 per cent reduction in royalty rates and selected statutory charges for natural forest logs from all Forest Timber Licences (FTLs) and Licences for Planted Forests (LPFs), excluding Timber Industries Tariff H0272502.

According to the Forest Department Sarawak (FDS), the temporary measure will be implemented within two weeks to allow for system updates and will remain in effect for one year, subject to review.

This timely intervention reflects the state government’s commitment under the leadership of Sarawak Premier Datuk Patinggi Tan Sri (Dr) Abang Abdul Rahman Zohari Tun Datuk Abang Openg to supporting the forestry and timber industry amid rising fuel prices, global market volatility, supply chain disruptions, and increasing operational costs.

“The reduction aims to provide immediate cost relief, improve operational viability, stabilise margins, strengthen domestic timber processing, and ensure continued industry participation and supply stability.

“Recent trends show that escalating costs have driven a shift towards export-oriented production due to better margins, while domestic processing activities have declined.

“This measure is expected to rebalance the sector by enhancing the competitiveness of local processing and strengthening the overall timber value chain.

“LProduction is projected to stabilise at approximately 1.73 million cubic metres annually, reflecting improved industry confidence,” FDS said in a statement issued on Wednesday.

The department said beyond short-term relief, Sarawak remains firmly committed to forest restoration and sustainability.

In this regard, the state has aggressively implemented the Greening Sarawak Campaign and Forest Landscape Restoration (FLR) initiatives as key pillars of its environmental agenda.

“From 2021 to 2025, over 57 million trees have been planted across Sarawak, representing the highest tree planting achievement in Malaysia.

“These efforts contribute to restoring degraded forest landscapes, enhancing biodiversity, strengthening carbon sequestration, protecting water catchments, and ensuring long-term sustainability of forest resources.

“In parallel, Sarawak is advancing large-scale planted forest development to reduce reliance on natural forest timber. These plantations provide sustainable raw materials for the timber industry while supporting renewable energy production through wood pellets and biochar,” FDS explained.

The state is also promoting a waste-to-energy approach, converting wood residues and by-products into valuable energy resources.

FDS said this initiative enhances resource efficiency, reduces waste, creates new economic opportunities, and strengthens Sarawak’s transition towards a green and circular economy.

While providing targeted support to industry players, the State Government remains committed to sustainable forest management and responsible resource utilisation.

Meanwhile in the same statement, Datuk Patinggi Abang Zohari said this decision underscores the Sarawak Government’s pragmatic and responsive approach in addressing current economic challenges, while ensuring that the forestry sector remains resilient, competitive, and sustainable for the future of Sarawak. -UKASnews