Takeaways on how to expose hidden timber crime using trade data

Speaker: Fred Ellis, Wildlife Trade Analyst and Financial Specialist, TRAFFIC

Illegal timber trade is frequently accompanied by document fraud, mislabelling and manipulated paperwork, much of which can leave traces in official trade statistics.

Trade discrepancy analysis is a relatively common analytical method, which effectively measures the difference between a country's export records and its trade partner’s import records. Mismatches between importing and exporting countries’ records, paid and market prices, or recorded and actual weights or volumes of shipped goods can also reveal these discrepancies.

The TimberStats Discrepancy Analysis platform helps expose hidden timber crime by identifying inconsistencies in global trade data. This interactive, web-based data platform was developed to combat illegal timber trade by identifying significant inconsistencies in trade records.

This Open Data Working Group session explored recent upgrades to the TimberStats platform through a live demonstration. Fred Ellis, Wildlife Trade Analyst and Financial Specialist at TRAFFIC, profiled trade discrepancy analysis tools and how they are used in practice. This included case examples of how these tools are supporting customs officials, law enforcement, and the financial sector to identify companies at risk of timber smuggling, document fraud, tax evasion, or trade-based money laundering. The new platform, which is based on UN Comtrade data, now holds 3.9 million records of timber trade data from 189 countries.

The TimberStats platform was developed by TRAFFIC in collaboration with M.A.P Scientific Services with funding from Norway's International Climate and Forest Initiative (NICFI), the UK’s Department for Environment, Food & Rural Affairs (DEFRA) IWT Challenge Fund and the UK’s Foreign, Commonwealth & Development Office’s (FCDO) Forest Governance, Markets and Climate Programme (FGMC).

Key takeaways

• Comparing export and import records can surface red flags for timber crime.

TRAFFIC treats an import value exceeding the export value by more than 20% – or an export value exceeding the import value – as an initial indicator of potential smuggling, trade-based money laundering, tax evasion or document fraud offences.

• Treat discrepancies as indicators, not evidence.

A mismatch between export and import records is a red flag that requires further investigation and additional data. Discrepancies can also arise from reporting errors, differences in data recording and data aggregation, so confirming an offence always requires more information and further examination.

• Use a guideline range, but expect it to vary.

The approach presented expects import values to exceed export values by roughly 6-20% because of the addition of transport, insurance and other costs on top of the cost of the product in transit. Therefore, gaps above 20%, or import values lower than export values, are treated as potential red flags, with the expected gap varying by trade route and product, and over time.

• Look for a range of offences behind the gaps.

Artificially lowered or inflated values can point to tax evasion or trade-based money laundering, while discrepancies may also indicate document fraud, corruption, protected species mislabelled as unprotected ones, or timber used on paperwork to conceal other trafficking.

• Move from trade routes to commodities to companies.

Red flags can be narrowed to specific commodity codes for enhanced screening by customs and law enforcement. Cross-referencing these high-risk HS codes against bill of lading data can lead to the identification of companies at higher risk of contributing to these discrepancies.

• Global coverage now allows comparison between any two trading partners.

The TimberStats platform has grown from 79 to 189 countries and from about 370,000 to 3.9 million records covering ten years, and it is refreshed as new data is published on UN Comtrade.

• Reporting gaps, delays and inconsistent units limit what the data can show.

The analysis is retrospective (for most, countries the latest data covered was 2024), it focuses on US dollar values because weight and volume records are inconsistent, and it cannot identify species; for which participants were pointed to the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) trade.

• The findings can serve more than enforcement, but outcomes are hard to track.

Civil society researchers, governments seeking to improve data reporting and those working infinancial sector risk monitoring can all use the results, although the presenter noted that agencies rarely report back on action taken and called for greater transparency from partners.

TimberStats is freely accessible via TRAFFIC’s Wildlife Trade Portal under the ‘Other Tools’ tab. It is available in five languages – English, Chinese, Vietnamese, French and Spanish.

The full recording of the presentation from the 14 October Open Data Working Group meeting is available here: