Domestic Forest Conservation and the Physical Climate-Risk Exposure of Timber Sourcing: Evidence from China’s Raw-Log Imports

Domestic forest conservation can reorganize international sourcing when downstream timber demand remains active after harvesting restrictions. This article examines whether China’s natural-forest conservation and commercial logging restrictions coincided with a reallocation of raw-log sourcing toward suppliers with higher pre-policy physical climate risk. Using BACI HS2002 bilateral trade data for HS 4403 raw logs and supplier-level pre-policy GCPRI measures, the analysis compares China’s supplier allocation with that of comparable foreign raw-log importers in a same-product cross-country difference-in-differences-in-differences (DDD) framework. China’s post-policy supplier allocation shifted relatively more toward suppliers with higher pre-policy GCPRI than did the allocation of comparable foreign importers in the baseline observed-flow specification. Additional revision checks show that the result remains positive in a zero-share supplier panel, weakens in the pre-2020 sample, and is not robust to a China-specific supplier-risk trend or importer-placebo inference. Conventional diversification measures moved in the opposite direction: concentration fell, effective supplier counts increased, top supplier shares declined, and the supplier quartile with the highest measured physical climate risk gained share. A decomposition attributes most of the observed change to incumbent supplier reweighting. The evidence therefore documents a sourcing-composition pattern rather than a clean causal effect or direct environmental-damage result. Supplier diversification and the physical climate-risk profile of sourcing are distinct dimensions of sustainable supply-chain assessment.