Forest Products Industry

The New Zealand Forest Owners Association says the just-released NZIER report commissioned by the Helen Clark Foundation on New Zealand’s food and fibre exports, fails to appreciate the economic, social and environmental benefits of production forestry. Source: Timberbiz The Pathways to Prosperity report clings to forestry misconceptions, claiming the sector is a pine ‘monoculture’, producing woody material and sediment in waterways and having a negative impact on rural communities. Forest Owners Association chief executive, Dr Elizabeth Heeg, says there is evidence to the contrary. “Forestry shows the greatest growth potential of all primary industries with an increasingly important role in strengthening our rural communities,” Dr Heeg says. “A report from PwC in 2020 found that forestry generated twice the number of jobs per hectare than hill country farming. That’s way outside any margin of error.” “New Zealand’s production forest estate is arguably also the only tool our country has available to meet its 2050 climate change targets.” “Our trees currently offset more than half of the nation’s total carbon emissions. These plantation forests have been solely responsible for reducing gross emissions from 76.8 million tonnes of carbon dioxide down to 55.7 million tonnes.” The lack of appreciation for the scope of worldwide demand for timber and timber products in the future is perhaps the largest failure of the Clark Foundation report. “Not only will the worldwide demand for timber to replace carbon emitting concrete and steel, rise rapidly in the near future, but so too will the demand for wood-based biofuels and other plastic substitute products increase too,” Dr Heeg says. “This shift from log exports to higher value forestry bio-products is anticipated to increase the sector’s export value by approximately $12 to $19 billion according to the 2023 NZ Product Accelerator report.” The report’s undue emphasis on popular forestry misconceptions also downplays the important role of trees in maintaining a healthy environment. “The widespread belief there is a monoculture of pines is simply not true,” Dr Heeg says. “Both forestry and pastoral farming hold important roles in maintaining a mosaic of land uses and both are increasingly planting native vegetation along riparian strips, including sites where it’s too steep to plant trees or farm animals.” “Both industries have about 15 percent of their area in native vegetation. There is hardly any difference.” “Production forests are important habitats for supporting Aotearoa’s wildlife too,” Dr Heeg says. “There is strong evidence that native birds such as falcons and kiwi, prefer plantation forests due to greater food availability and the lack of predators, making it a safer environment.” “Forestry also has a unique role to play in minimising erosion. Research shows trees and their root systems stabilise the land for long periods, bind the soil and slow slip movement, decrease water runoff and erosion, and help in draining and improving soils.” “Likewise, our forests effectively filter out water contamination from other land use. These are major issues noted by the Clark Foundation report, but forestry’s role as a water purifier goes unrecognised.” “It is disappointing that the Helen Clark Foundation and NZIER are exacerbating misconceptions about forestry and missing a major productivity opportunity for New Zealand and its bioeconomy.”

With an ageing population placing increased strain on New Zealand’s public services, the country must earn more to maintain current living standards in the years ahead, a new discussion paper has found. Source: Timberbiz Released by the New Zealand Institute of Economic Research, Pathways to prosperity: Capturing more of the value of our food and fibre sector exports for New Zealand calls for “investment and policies that do not demand immediate results” to boost productivity in the food and fibre sector. The sector, which includes agriculture, horticulture, forestry, fishing and associated processing, accounts for 80% of New Zealand’s goods exports and is one of the main sources of income and tax revenue that fund public services. But it needs to earn more, says Peter Davis, Chair of the Helen Clark Foundation, which commissioned the discussion paper. “This country faces a key challenge in providing an ageing population with the quality healthcare, education and superannuation New Zealanders rightly expect,” Davis says. “New Zealand clearly needs to earn more as a country in the decades ahead to meet these expectations.” However, many New Zealand firms do not have the skills and scale necessary to compete effectively in unforgiving global markets, the paper’s authors Todd Krieble and Bill Kaye-Blake say. “We need to ensure we’re doing everything we can as a country to support the sector to grow its productivity and earn more from exports without putting more pressure on our people or our environment. “The good news is that our paper finds clear pathways New Zealand can take to achieve this.” Pathways include developing a more skilled workforce; consumer-driven marketing and product development; better investment, especially in processing; improving management and governance; and strategic collaboration to create scale and larger investment pools. The paper’s authors also identify key challenges to achieving greater productivity in the sector, which include lower levels of investment and technology in food and fibre processing compared to similar economies, and the risk-averse nature of firms (sometimes resulting from organisational structure, such as co-ops) and the mindsets of senior managers and directors. Krieble and Kaye-Blake suggest “time and patient money – that is, investment and policies that do not demand immediate results” could enable the sector to overcome these disadvantages. “Improving productivity will be hard, but maintaining the status quo will leave us with a middling economic performance and increasing anxiety about how New Zealand will pay its way in the future,” they say. “The sector’s challenges, especially in processing, have existed for decades and the underlying issues are not amenable to quick fixes. “We hope this paper provides a jumping off point for further discussions about the strengths of the sector, and how it can adapt and grow despite the challenges of the 21st Century.” Pathways to prosperity: Capturing more of the value of our food and fibre sector exports for New Zealand The discussion paper’s recommendations for the sector and for the Government include: Food and fibre exporters should be supported to be “mini-multinationals” – extracting more value from competitive export markets means companies, even small ones, have to do everything that bigger multinationals do: market research, product development, supply chain management, export clearance, and financial arrangements. Most food and fibre companies do not yet have all these capabilities and will need support in developing them. Government could identify businesses with the right set of capabilities and potential, and work with them proactively to build their exporting capabilities. Building on insights developed by MBIE and other agencies to focus government resources on those firms most likely to lift export intensity would mean working with firms that meet identified predictive characteristics of success rather than simply seeking to pick winners. Government with industry to understand what kind of investments would best support export growth and devise a long-term investment strategy. This approach could identify processes, technologies, training that would benefit both a company and the wider economy, helping New Zealand to develop the sorts of mini-multinationals that are needed to extract more value from export markets. Industry and government could collaborate to develop mechanisms that reduce investment risks in the food and fibre sector, given the sector’s importance to New Zealand and the higher risk profile it faces. For example, a government fund with an equity stake that invests at below-market rates could provide funding but capture the upside from ventures that succeed. More investment should be made into research the practice of management in New Zealand, given the importance of managerial capability in building export-capable firms. Consideration should also be given to subsidies or tax credits for managerial training for qualifying management and governance roles in the food and fibre sector. Government should consider requiring a minimum level of vocational training per year, and should ensure existing policies and programmes that incentivise businesses to undertake workforce training are working effectively and efficiently. Industry and Government should collaborate to explore options for more strategic collaboration among key players in the food and fibre sector. This should include investigation of the mechanisms and policies necessary to facilitate effective collaboration, while being mindful of limits set by competition and trade law. Funding could be directed to academic and applied research to determine the most promising forms of collaboration for the food and fibre sector. You can download the report here.

  The National Timber & Hardware Association has opened its 2024 State awards season, inviting nominations from businesses across all states and territories in Australia. Source: Timberbiz The NTHA Timber & Hardware Industry State awards occur bi-annually, serving as a platform to recognise outstanding contributions and inspire excellence throughout the industry. NTHA encourages businesses to take the opportunity to spotlight their achievements, elevate their brand, and contribute to the advancement of the timber and hardware sector collectively. “I am continually inspired by the exceptional calibre of our industry members. The NTHA Timber & Hardware Industry Awards stand as a testament to the relentless pursuit of excellence within our industry,” NTHA CEO, David Little said. “Through these awards, we celebrate both organisational and individual achievements, showcasing the collective brilliance that propels our industry forward. Each nominee represents a story of dedication, innovation, and unwavering commitment to excellence.” Nominations are now open for the following categories: NTHA Trainee/Apprentice of the Year NTHA Student of the Year Emerging Leader The REAL Difference Award 30+ Years Industry Service Trade Store of the Year Retail Store of the Year Under 2500sqm Retail Store of the Year Over 2500sqm Best Garden Centre Best Frame & Truss Operation Trade Supplier of the Year Retail Supplier of the Year Garden & Outdoor Supplier of the Year Safety Culture Award The time to nominate is limited, with deadlines varying across different states and territories. Winners will be announced at the State or Territory awards ceremonies for which they are nominated. Winners from the NTHA State Awards will continue to the national awards final in 2025. Dates and locations for the award finals are as follows: 14 June 2024 Victoria & Tasmania 27 July 2024 Queensland 9 August 2024 South Australia & Northern Territory 13 September 2024 New South Wales & Australian Capital Territory 11 October 2024 Western Australia “Our 2023 award win was a great morale boost for our management team and staff. The award recognition was encouragement to continue our journey of business transformation,” said Philip MacGregor, Managing Director, Hardware & General Supplies (Brookvale), the 2023 national award winner for Best Timber & Building Materials Store. “We have used the award in our advertising to our customers.  We have used the award in evidence to our staff that we are going in the right direction, a customer-focused business aiming to make it a great place to work and a great place to shop, to consolidate our profitability and to lead our markets.” To nominate for one or more of the 2024 award categories, visit: https://www.ntha.com.au/events/2024-state-awards/ For more information on nominations and award categories, visit: https://www.ntha.com.au/about-us/ntha-timber-hardware-industry-awards/  

Pentarch executive director Steve Dadd has rejected claims he favours an orderly transition away from native forest logging in New South Wales. Source: Timberbiz Mr Dadd, who is also Australian Forest Products Association Chairman, issued a statement yesterday clarifying statements attributed to him in an Australian Associated Press media release issued last week. In that media release businessman and activist Geoff Cousins was reported as supporting a campaign against the New South Wales government’s continued support for native forest logging. Mr Cousins was reported as saying he had recently met with Environment Minister Penny Sharpe and Agriculture Minister Tara Moriarty, and that they both “accept that the status quo cannot continue”. Mr Cousins also claimed the Forestry Corporation’s two biggest customers, Pentarch Holdings and Brambles recently contacted him. Mr Cousins says both companies needed to understand that buying Forestry Corporation products resulting from the destruction of koala habitat is like supporting multinational companies that pay sweatshop workers a pittance. He claimed both companies expressed the desire for an orderly transition away from native forest logging to avoid the “shambles” Victoria saw when the government abruptly shut its business down, years earlier than expected. “The chair of the Forest Products Association, he said ‘yeah the last thing we want is what happened in Victoria’. I said Well you’re going to get it unless you take a lead.” But Mr Dadd said Mr Cousins’ claim that he expressed the desire for an orderly transition away from native forest logging was false. “I made no such statement about a transition out of native forestry,” Mr Dadd said. “We do not support any form of transition away from native forest harvesting.” Mr Dadd also clarified other statements made in the media release. “I did indeed meet with Mr Cousins in good faith to hear his views and invite him to visit our operations and unfortunately found him unwilling to engage on the many benefits of native forestry or acknowledge scientific evidence,” he said. “He is either denying the irrefutable science that native forestry has little impact on koala populations or is ignorant of the facts which are clearly stated on the Natural Resource Commission website. “To scurrilously compare native forestry to sweatshops is clever spin from an experienced advertising executive to further corrupt public opinion about the sustainable harvesting and regrowing of hardwood from just 1% of our forests. “Mr Cousins does not appear to recognise the benefits of carbon stored in hardwood products or the sequestration of carbon in regrowing forests where wildlife thrives. “He refuses to acknowledge the $1.1billion benefit the industry brings to the State of NSW or the 8900 families directly supported by the industry. “So, it’s difficult to understand how Mr Cousins can consider himself to have a balanced view on native forestry and we hope the NSW Government sees his opinions for what they are. “We accept the commitment to establishing a Great Koala National Park and are working with the NSW Government to ensure it achieves both a sustainable future for our business, the people and communities who rely on us and maximises benefits for the climate and koalas. “We are also hopeful that native forestry is recognised for its many scientifically proven benefits for the environment, as expressed by the Intergovernmental Panel on Climate Change. “We should accept our global responsibility in supplying ethically and fully certified hardwood rather than rely on imports from countries which do not have in place the same checks and balances as we do here.” Australian Forest Products Association CEO Diana Hallam said the group reached out to Mr Cousins after recent media reports about his views on native forests. “As Australia’s peak forest products industry advocacy body, we appreciate hearing people’s views and concerns,” she said. “Those who campaign against Australia’s native forestry sector are campaigning for worse environmental and climate outcomes. Our objective is to make sure more people understand that.”