(Business in Cameroon) – Cameroon is projected to produce 5.6 million cubic meters of wood in 2024, according to the Central Bank of Central African States (BEAC) monetary policy report. This amount accounts for 47% of the total production from the six CEMAC countries. This is an increase from 38% in 2022. However, this growth comes at the expense of Congo and Gabon, where wood production is expected to decline by 44% and 12.7%, respectively, compared to 2022.
The anticipated performance in Cameroon’s wood sector reflects strong interest from operators, even as tax burdens increase. To prepare for the eventual ban on log exports, set to be phased in by CEMAC countries and the Democratic Republic of Congo starting in 2025, Cameroon has been gradually raising taxes on log and lumber exports for nearly a decade.
From 2017 to 2023, for instance, the exit tax on logs increased from 17.5% to 60%. This series of tax hikes, detailed in various finance laws, represents a total increase of 343% in log export taxation. In the 2024 finance law, this exit tax rose further to 75% of the value at the Free on Board (FOB) stage. The same tax for sawn timber from primary processing rose by 165% between 2016 and 2023, according to forestry operators.
The government claims these measures aim to boost secondary wood processing in the country, which requires new investments. However, financing these investments remains a challenge, despite exemptions offered by the government on equipment for transformation.
Despite the tax increases, which led the forestry operators’ group to threaten a halt to exports in early 2023, producers in Cameroon’s wood sector appear undeterred by rising production costs. While BEAC forecasts a good wood yield in 2024, the Industrial Producer Price Index (IPPI) for the second quarter of 2024, released by the National Institute of Statistics (INS), indicates a sustained increase in factory prices within the sector since 2021.
Year over year, the report shows that producer prices in the wood industry rose by nearly 12% in the second quarter of 2024. This trend was already evident earlier in the year, with a reported increase of about 12.5%. Quarterly, prices in the wood industry rose by 3.4%. The INS document notes that since the start of 2021, producer prices in this sector have continued to climb.
The resilience of forestry operators in Cameroon, despite unfavorable fiscal conditions and production costs, can be attributed to the growing international demand for Cameroonian wood. In its 2023 report on Cameroon’s economic competitiveness, the Competitiveness Committee highlighted that wood was the most competitive Cameroonian product in the international market that year.
According to this specialized agency within the Ministry of Economy, Cameroon was ranked as the leading exporter of sawn sapelli and iroko wood in 2023. The country also stood out as the third-largest exporter of tropical sawn timber and was among the top 10 exporters of veneer sheets worldwide.
