PI - Bamboo by Number

INTRODUCTION [ bamboo by numbers ]

SECTION 01 [ bamboo story ]SECTION 02 [ poverty reduction ]SECTION 03 [ carbon case ]SECTION 04 [ business case ]

[ bamboo by numbers ]


The world needs solutions to poverty and climate change!Yes bamboo conjures up images of traditional lifestyles and products, however….


Right now there is an historical event taking place. In the last 15 years, businesses and innovators have perfected ways to turn bamboo into many high value things – from wood products like construction panels to high quality textiles – at a global industrial scale.

These are not fad or niche products.

The current global market for bamboo products is $12-15Billion .

Bamboo has unique tensile strength, absorptive and other physical qualities. Coupled with diverse aesthetic appeal, bamboo manufacturers are competing and gaining large share in high value markets around the world.

The future is very exciting.


We all need bamboo industries to continue on this trend of new market success.

Bamboo has an enormous potential to be part of the solution for of the most important issues of our era:

Bamboo is grown by the world’s poor. Poor bamboo growers benefit much more than small holders gain from the main forest industries.

Bamboo forests provide excellent carbon and environmental benefits to all of us.

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Ultimately, bamboo’s success is

all about the numbers…

Think about bamboo…good for poverty reduction

good for a low carbon future

good for business …

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[ bamboo story ]

[ bamboo story ]

37Million HaThe current area of bamboo in the world is slightly more than the area of Germany (35M) Lobovokov 2009

1Billion

The number of people (most of whom are poor) who use bamboo in their everyday lives.

[ bamboo story ]

BAMBOO FARMING IN VIET NAM

Photo: Tran Hong Nhung

[ bamboo story ]

Low carbon transportation to market in Northern Viet Nam

Photo: Patrice Lambelle

[ bamboo story ]

Bamboos grow naturally in the tropical and sub-tropical regions between 46° North and 47° South on all continents except Europe and from sea level up to 4000m elevation Scurlock et al. 2000.

Their distribution coincides with potential CDM host countries. Globally, bamboo forests grow on at least 37 Million Ha Lobovikov et al. 2007 and make up 3% of the forest areas of their host countries on average.

India, China, Indonesia, Ecuador, Myanmar and Viet Nam have the largest bamboo resources of 25 countries recently surveyed Lobovikov et al. 2007.

[ bamboo story ]

>1000The number of bamboo species in the world

>100The range of products in the global market

[ bamboo story ]

Mai khom bamboo shoot, Lao PDR

Luong bamboo Viet Nam Lao PDR


Photo: Phillippe Rousseau

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Photo: Ding Xingcui

Photo: Nigel Smith

Bambusa Polymorphia, India

Moso Bamboo China

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[ bamboo story ]

The parts of a bamboo plant are utilised for many different products Zhu 2005

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Leftovers & processing waste

Fuels

Pulp

Charcoal

Fiber boards

Lumber

Blinds, Mats, Carpet

Flooring

Vegetable

Handicrafts

Brooms, Cloths

Manure, Fodder

Extracts, Medicine

Bamboo poles

Laminated furniture

Charcoal, Pulp

Handicrafts

Chopsticks, Toothpicks

Scaffoldings

Chopsticks, Toothpicks

Middle upper

Middle lower

Base

Shoots

Sheath & Rhizome

Twigs

Leaves

Top

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[ bamboo story ]

[ poverty reduction ]


$1200/Ha/yrThe return per hectare for bamboo farmers in Anji China (>$400/Ha/yr in Viet Nam)

45 days/yrThe number of labour days required to manage a hectare of bamboo per year


Woman harvesting Truc Sao bamboo Cao Bang Province, Viet Nam

Luong bamboo part of a mixed farming system in upland Viet Nam


Photo: Tran Hong Nhung

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>200 tonnes/yrThe amount of soil lost from steeper upland slopes under cassava/maize cropping

>2 timesThe relative returns to day labour for farmers producing luong bamboo compared to producing rice, maize, sugarcane and other upland crops Viet Nam


Crop SamplePer

hectarePer family labour day

N Median Median

Ordinary rice (irrigated) 178 9.856 0.0438

Cassava/manioc 153 5.333 0.02

Bamboo 140 2.364 0.0982

Maize/corn 117 4.5 0.0279

Glutinous rice (irrigated) 73 9.875 0.0547

Vegetables 46 3.833 0.0139

Upland rice (non-irrigated) 36 0.354 0.0018

Sugar cane 34 13 0.0477

Peanuts 21 3.28 0.025

Photo: Tran Duc Toan

Gross income returns (VND millions) measured i) per hectare andii) per family day labour of typical upland crops. PI Analysis 2009

Some upland farming systems in Viet Nam are not sustainable

Bamboo is a good use of a farmer’s time in the uplands


500,000 & 25%The number of people in bamboo producing households and the % of their household income from bamboo in Northern Viet Nam PI analysis 2009

69%The % of people living below $2/day in northern Viet Nam in 2008 in bamboo communities PI analysis 2009


Industrial bamboo firms and supply areas in Northern Viet Nam and Lao PDR Marsh and Ngo 2009


Income Segment

Crop 24.70%

Livestock 17.70%

Bamboo 25.20%

Other 32.50%

Bamboo as a major income segment for upland farmers in Viet Nam PI Analysis 2009


Per capita Income (real 2008 VND millions)

2006 2008

Bamboo household total incomes in Thanh Hoa Viet Nam 2006 to 2008. Positive steps to moving out of poverty (curve moves to right). PI analysis 2009


$40MBamboo “farmgate” sales in Northern Viet Nam in 2008 PI Analysis 2009

63%The proportion of women working in bamboo processing jobs – the highest segment of waged labour in the industry PI Analysis 2009


The level of income into poor, near poor and total bamboo selling households In Northern Viet Nam in 2008. PI Analysis 2009

Bamboo Selling Households

Target Community # People in bamboo selling HH

% HH income from bamboo

Total bamboo sales$M in 2008

Those living on <$1.25ppp/ person/day (ie “the Poor”)

254,000 19.9% $6.5 M

Those living on <2ppp/person/day(ie “Poor and Near Poor”)

361,000 22.0% $19.0M

All bamboo farming households 518,000 25.2% $40.7M

Note: These 1.25 and 2 poverty lines are internationally recognised poverty lines as referenced within Millenium Development Goal Targets, and in UN and World Bank global poverty reports. But these figures are purchasing power parity (ppp) figures. In 2009 the figures for $1.25ppp and $2ppp are approximately:i) Lao PDR - $1.25ppp = LAK 3700/day (44c/day) and $2ppp = LAK5900/day (71c/day) and :ii) Viet Nam - $1.25ppp = VND6000/day (33c/day) and $2ppp = VND9400/day 53c/day).


Waged jobs (FTE) and income in the Northern Viet Nam Bamboo Industry 2008PI Analysis 2009

On Farm Total Harvesting Other on Farm

FTE Job income FTE Job income FTE Job income

3,600 $1.8M 3,200 $1.6M 400 $0.2M

Off Farm Processing and Other Transp/Handling/Other

FTE Job income FTE Job income FTE Job income

10,600 $5.2M 7,600 $3.8M 3,000 $1.3M

Total 14,200 $7M


7,200The number of people below $2/day benefiting from new investments in bamboo processing by PI’s partners in 2009 PI Analysis 2009

$5Million/yr and 55,000The potential scope of impact through i) new income and ii) the number of people below $2/day benefitting by 2014 through new investments by PI’s business partners in Northern Viet Nam PI Analysis 2009


PI’s support to new bamboo industries creating impact in Viet Nam

Women hold 63% of jobs in bamboo processing in Viet Nam

Target IndicatorAchieved End

2009Target 2011

People below $2/day with income from new jobs or sales of bamboo

Total Income $M/yr – jobs and sales

$0.46M $2.1M

New jobs 140 830

# Beneficiaries 7,200 33,000

All people from bamboo communities with income from new jobs or sales of bamboo

Total Income $M/yr – jobs and sales

$0.72M $3.1M

New jobs 370 1,700

# Beneficiaries 11,000 49,000

Photo: Ngo Viet Hung


The bamboo industry in Northern Viet Nam in 2008. High utilisation businesses (pressed bamboo and construction board) were added to the processing stream in 2008 alongside sticks and laminated products – this development should catalyse new value added investment in the coming years. PI Analysis 2009

See enlarge chart below



30%The % of total sector economic output going to small holders from bamboo industries in China and Viet Nam PI Analysis 2009

8%The amount of global forest resources owned by smallholders FAO 2005


Commercial use of Bamboo forests benefits smallholders FAO 2005 and PI Analysis 2009

Commercial Timber Supply Globally

Commercial Bamboo Supply in Viet Nam & China

[ carbon case ]

[ carbon case ]

6.3 (teak) & 47.8 (bamboo) Tonnes/Ha/yr The biomass growth of teak timber and spiny bamboo bambusa bambos, a common tropical variety in India, Myanmar, Indonesia etc Guttiérez et al., 2006

191 (teak) & 442 (bamboo) Tonnes/HaTotal estimated steady state carbon storage in all forms (forest and sequestered within products) in a total lifecycle production systems for tropical forest production in teak timber and bambusa bambos. Teak requires 40 years to reach this level, bambusa bambos 20 years. Boateng 2005; Shanmug-havel and Francis 2002

[ carbon case ]

Mean annual biomass productivity above-ground (t/ ha/yr)

Total biomass carbon storage at maturation

(t C/ha)

Total est. carbon storage incl. products

(t C/ha)

Timber Plantation Species

Teak Tectona Grandis

6.3 126 (40 yrs)

191 (40 yrs)

EucalyptusEucalyptus grandis

16.14 no data no data

EucalyptusPlantar high-yield Eucalyptus

17.5 61.25 (7 yrs)

no data

EucalyptusPlantar clones Eucalyptus

21 73.5(7 yrs)

no data

Bamboo Species

Phyllostachys pubescensCommon Name: Moso; Temperate; China and Japan

17.24 - 27.58 92 t C/ha(5-8 years)

159.4 (20 yrs)

Bambusa Bambos Common Name: Spiny bamboo Tropical; India, Myanmar Indonesia etc

47.8 149 t C/ha(6 years)

442.15 (20 yrs)

Bamboo species have high carbon storage and annual carbon production compared to common timber production species. Widenoja 2007

[ carbon case ]

Aboveground biomass of bamboos and timber trees are very similar. For example, the lines cross the point which says that 90% of both timber and bamboo areas have 225t or less of above ground biomass. Hunter and Wu 2002

Aboveground biomass (t/ha)

Biomass stock distribution functions

TimberBamboo

[ carbon case ]

45 The number of commercial bamboo species covering a range of climatic zones in the world. Bamboo is climatically and commercially versatile

5-8 The number of years required to establish a fully producing mature bamboo plantation from bare land

[ carbon case ]

Global distribution of bamboos Lobovokov 2007

Bamboo is a diverse, widely distributed and versatile group of species well suited to smallholder adaptation practices to cope with climate change

[ carbon case ]

0 The current recognition for bamboo under current UNFCC programmes

2The UNFCC programmes that should explicitly include bamboo

[ carbon case ]

Bamboo should receive special attention as one of the crops that should be incorporated within the UN Framework Convention on Climate Change (UNFCCC).

Bamboo should be included in the UNFCCC programs, particularly Land Use,

Land Use Change and Forestry ‐ (LULUCF), including the Reducing Emissions from Deforestation and Forest Degradation in Developing

Countries Programme (REDD).

(part of the text from a resolution to COP15 signed by the delegates of the World Bamboo Congress, Bangkok September 2009)

[ business case ]

[ business case ]

<1%the current share of global high value wood product markets held by bamboo

$100Billion/yrThe current global market for high value wood products

[ business case ]

Market Segment

Bamboo Share of Global Market ~0.5% of Global Wood Product Market (2009)

Global Wood Product Market

[ business case ]

60%The increase in global hardwood commodity prices 1999 to 2009

$1000/TonneThe current market price for many bamboo products like panel board and engineered lumber

[ business case ]

Hardwood Commodity Prices 1999-2009

Hardwood Sawnwood Dark Red Meranti, select and better quality, C&F U.K port per cubic meter

Source:IMF Commodities Unit

Hardwood logs, Best quality Malaysian Meranti, import price Japan, per cubic meter

[ business case ]

Final Quality Product

Pressed bamboo (eg Strand Woven ®) is a new high value competitive timber product

[ business case ]

Hardness and Dimension Stability of Pressed Bamboo in comparison with other types of hardwood (Source: http://strandwoven.com)

Hardness of Common Woods Dimensional Stability of Common Woods(smaller values indicate greater stability)

[ business case ]

100%Price advantage of pressed bamboo over timber equivalents, e.g. “iron wood” for joinery in Viet Nam PI Analysis 2009

43%Return on equity (10 year average) for a new pressed bamboo business in Viet Nam PI Analysis 2009

[ business case ]

Key profitability indicators Unit Quantity

Total initial investment needed

Mil USD 1.13

Equity Mil USD 0.67

Debt Mil USD 0.46

Internal rate of return (IRR) % 49%

NPV (20% discount rate)

Mil USD 1.88

Return on equity (ROE - 10 year average) % 43%

Return on equity in year 10 % 36%

EBIT/Revenue (10 years average) % 18%

Payback period Years 4

Breakdown of revenue into expenses and profit (EBIT) indicator for Pressed Bamboo Operation in Viet Nam PI Analysis 2009

[ business case ]

10-20%

Raw material utilisation rates of first generation high value product manufacturing including chopsticks, laminated flooring, etc selling for >$1000/tonne finished product

60-80%Utilisation rates of new generation processing like construction board, pressed bamboo, selling for >$1000/tonne finished product

[ business case ]

First Generation

Chopsticks $1000/tonne Pressed bamboo $1000/tonne

70-80%End product

10-20%End product

70-80%residues

New Generation

[ business case ]

120 The number of pressed bamboo factories in China in 2009

12 monthsThe time required to transfer technology and establish full production

[ data sources ]

[ data sources ]

Boateng, S. A. 2005. HOW MUCH CARBON DO GHANA’S TEAK PLANTATIONS SEQUESTER? ITTO Tropical Forest Update 15/4 2005. Forestry Research Institute of Ghana: http://www.itto.or.jp/live/Live_Server/1162/tfu.2005.04(22-23).e.pdf

Gutiérrez, V.H., Zapata, M., Sierra, C., Laguado, W., and Santacruz, A. 2006. MAXIMISING THE PROFITABILITY OF FORESTRY PROJECTS UNDER THE CLEAN DEVELOPMENT MECHANISM USING A FOREST MANAGEMENT OPTIMISATION MODEL. Forest Ecology and Management 226: 341–350. .

Hunter, I. R., and J. Wu. 2002. BAMBOO BIOMASS. International Network for Bamboo and Rattan (INBAR).

Lobovikov, M., S. Paudel, M. Piazza, H. Ren, and J. Wu. 2007. WORLD BAMBOO RESOURCES. FAO, Rome, Italy.

Lobovikov, M., Yiping Lou, Schoene, D., Widenoja, P. (2009) BAMBOO CARBON TRADE. FAO

Marsh, J. and Ngo, V.H. 2009. THE EMERGING INDUSTRIAL BAMBOO CLUSTER IN NORTHERN VIET NAM: IMPACT ON UPLAND POVERTY REDUCTION World Bamboo Congress, Bangkok, Thailand 16-18 September 2009.

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[ data sources ]

Scurlock, J. M. O., D. C. Dayton, and B. Hames. 2000. BAMBOO: AN OVERLOOKED BIOMASS RESOURCE? Biomass and bioenergy 19:229-244.

Shanmughavel, P. And Francis, K. 2002. THE DYNAMICS OF BIOMASS AND NUTRIENTS IN BAMBOO BAMBUSA BAMBOS PLANTATIONS. Journal of Bamboo and Rattan 1(2):157-170

Widenoja, R 2007. SUB-OPTIMAL EQUILIBRIUMS IN THE CARBON FORESTRY GAME: WHY BAMBOO SHOULD WIN BUT WILL NOT. MSc Thesis Tufts University.

Zhu, Z. 2005. BAMBOO INDUSTRY’S IMPACDT EVALUATION ON RURAL SUSTAINABLE DEVELOPMENT IN ANJI, CHINA. In INBAR 2005 International Training Workshop on Small Bamboo Daily Product Processing Technologies and Machines. pp. 16 - 33

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[ thank you ]

www.mekongbamboo.orgmekongbamboo@pi-emailorg

Prosperity Initiative works hand in hand with investors and businesses looking to create value for themselves in industries we have shown can create poverty impact.

Prosperity Initiative has projects in the Bamboo, Tourism and Coconut Sectors in Viet Nam, Lao PDR, and Cambodia

Mekong Bamboo is a project by Prosperity Initiative to support the bamboo industry.

Prosperity Initiative works with governments, donors and development partners committed to achieving poverty reduction on a large scale.

Prosperity Initiative is supported by:

•Swiss Agency for Development Cooperation•Irish Aid•Oxfam Hong Kong•Oxfam America•AusAID•World Bank•International Finance Corporation•UNIFEM www.prosperityinitiative.org

278 Thuy Khue Street, 8th fl. Hanoi, Vietnam Tel: + 84 (4) 372 816 29/30/31 • Fax: + 84 (4)3728 1632

PI - Bamboo by Number

Technology

bamboo products

bamboo farmers

hectare of bamboo

bamboo good

bamboo forests

bamboo industries

bamboo manufacturers

introduction bamboo