Australian timber industry news

Celebrating 40 years since Timber Towns Victoria’s first inception in 1984, members recently toured the Baw Baw Shire region as part of their Annual General Meeting and yearly forum. Source: Timberbiz The Baw Baw Shire was one of many regions that were impacted by the Victorian Government’s announcement to cease native timber harvesting in state forests. TTV Vice President and Baw Baw Shire Councillor Michael Leaney said the site visits to the region have helped TTV group members gain a better understanding of how local businesses in the region are transitioning and the new opportunities being created. “Timbers Town Victoria will continue to advocate for the economic viability and ongoing sustainability of the towns and regions significantly impacted by the closure of native timber harvesting in state forests, and the State Government’s Forestry Transition Program has provided valuable assistance to affected communities and businesses,” Cr Leaney said. TTV President Councillor Karen Stephens hailed the three-day forum a success. “It is important to our members that we see first-hand these communities that have been affected by the cessation of native timber harvesting. We know that it has presented numerous challenges for these communities and TTV will continue to provide support and a commitment to these challenges faced by Victorian communities,” Cr Stephens said. ‘It has been pleasing to witness the innovation and positive changes that some businesses have made since the cessation of native timber harvesting to transition their business,” she said. Cr Stephens thanked all those who gave their time to assist in the success of the three-day forum. “Timber Towns Victoria offers a very special thank you to the businesses we visited and their time they gave freely to us – David Taylor, Willow Grove Timber Mill; Glenn Fenton, Nationwide Trees; Andrew Batarilo, Alpine Trout Farm; Doug Ward Drouin West Timber Truss,” Cr Stephens said.  

New Zealand Central North Island district mayors from Ruapehu, Kawerau and Taupo whose forestry mill operations are threatened by soaring electricity prices, have met with Prime Minister Hon Chris Luxon and Regional Development Minister Hon Shane Jones to discuss urgent actions to prevent the closure of mills and other export manufacturers. Source: Timberbiz Ruapehu Mayor Weston Kirton, Kawerau Mayor Faylene Tunui, and Taupo Mayor David Trewavas together with local iwi expressed united concern for the central North Island economy and its communities following Winstone Pulp International (WPI) announcement of plans to shut down its Tangiwai Sawmill and Karioi Pulpmill due to unsustainable energy costs. They warned that this impending closure is only the ‘tip of the iceberg’ unless an urgent solution is found for other New Zealand export manufacturers facing similar pressures from unsustainable energy costs. The mayors were ‘cautiously optimistic’ about the prospects of keeping WPI operational after their meeting with the Prime Minister and the Regional Development Minister. “There is no doubt that the Prime Minister and Minister Jones are acutely aware of what is at stake. They share our concerns for the economy and our communities, and want to find a workable solution,” said Mayor Kirton. “The government has demonstrated its commitment by inviting us to collaborate with WPI and present a proposal outlining what it would take to keep the mills operating. We are now working with urgency on developing a solution to put to them. “We are grateful for the government’s attention and support in addressing the immediate crisis facing WPI. The government has committed to considering whatever short-term solution we can put forward while they work to establish a long-term fix to prevent such a situation from arising again in the future,” he said.

Timber Queensland has partnered with Jobs Queensland to develop a workforce plan and action-based initiatives for the forest and timber industry through a state government funded ‘Grow Your Own’ program. Source: Timberbiz Representatives from employers in the Wide Bay region met regularly to pinpoint and endorse focus areas, assist with gathering information, identify key issues and help find solutions to develop, implement and monitor the regional workforce plan. Initially this group worked to develop a Wide Bay forestry industry snapshot, a document that provides an analysis of employment and training trends in the Wide Bay region and forestry-related industries. This report, produced for Jobs Queensland, aims to support the “Grow Your Own” Regional Workforce Program by identifying workforce challenges in the Wide Bay forestry region. This helped inform the development of mechanisms to implement action-based, locally focused and led workforce planning and initiatives. Specifically, it provides an analysis of the employment and training data and trends within the Wide Bay region and forestry-related industries. It identifies workforce challenges and opportunities. Following the publication of the region and industry snapshot industry-led consultation with key industry and community stakeholders, highlighted common workforce, training and business challenges. Despite these challenges, the industry showed a strong commitment to working with government and training providers to plan for their future by developing recommendations, priorities and practical methods to benefit the region’s forest and timber industry’s future workforce. The subsequent Wide Bay Forest and Timber Industry Workforce Development Plan provides a foundation for an industry committed to growth and future prosperity. The skills and experience Timber Queensland has gained from working with Jobs Queensland on the Wide Bay ‘Grow Your Own’ program can be applied in other major forest and timber industry regions in Queensland. “It has been very encouraging to see the industry pull together to drive the development of this plan,” Timber Queensland CEO Mick Stephens said. “It represents the most comprehensive deep dive into this industry for this region so far and will form part of a solid strategy to build resilience in our industry. “Now the real work begins as industry and other stakeholders take steps to carry out each one of the identified actions in the plan, which will take ongoing effort,” he said. “However, with the growth of the bioeconomy and housing demand creating new and expanding markets for wood products, new jobs and roles are emerging and we need to be prepared for that. This plan will help the local industry have the skills and workforce to deliver.” The Grow Your Own Workforce can be downloaded here. The  Wide Bay Forest and Timber Industry Workforce Development Plan can be downloaded here.

Double dips are great when we’re talking about chocolate dip, chip’n’dip and lotto but not so good when talking export log prices, but here we are. Quarter three kicked off with August prices down around NZ$4/m3 from July following a very slight rally from the low in April. Prices vary between ports but for the Southern North Island and Northen South Island you’re looking at around NZ$113/m3 for A grade shorts with Tauranga up a few on that, Lyttleton breaking into triple figures at NZ$101/m3 and similar numbers for the more southern ports. Interestingly, the three-year average price has dipped into the sub-NZ$120/m3 range for the first time since May 2018. Depending on whether you’re a glass half full or empty person, you could argue either way that current stickiness is a supply or demand problem, and to be fair you’d be right on both counts. Demand has reduced primarily due to the Chinese construction implosion, but this has been exacerbated by the traditional off season plus heavy rain and severe flooding in Northern China restricting uplift. Meanwhile, supply has dutifully carried on at around 55,000m3 per day, even in the face of ugly pricing, resulting in only a very small reduction in China on port inventory of 50,000m3 taking the total inventory position to 3.15 million m3. This is basically a Mexican standoff, but the difference is we are pointing our own guns to our heads. Until we can get inventory well under 3 million m3, we’re unlikely to see much in the way of price increases. At the current run rate, we’re delivering around 20 million m3 annualised into China where real demand going forward is probably in the teens. There’s talk of increased interest from India but there’s complexities around supply, and the demand is only a few vessels per month so no silver bullet there. The scenario in NZ isn’t a whole lot rosier in the construction space with framing lumber demand looking decidedly average. There is a glimmer of hope with the talk of OCR reductions but there will need to be a significant change in sentiment before housing starts return to 2023 levels. Pruned log demand remains stable with a large portion of the resulting clear lumber heading to the US and European markets, although those markets have also seen issues with demand. The value of pruned logs in the forest grade mix has created a resurgence in pruning as forest owners see this as a good return on investment. Domestic sawmills have been hitting the papers lately with a number of sawmills and pulp mills temporarily closing while spot electricity prices leap higher than Hamish Kerr. WPI shut both its sawmill and pulp mills, Oji closed its Penrose mill, Panpac shut its Napier mill and Donnelly’s shut its Reporoa sawmill. Shutting a sawmill or pulp mill takes a lot of consideration as it’s not just a case of flicking the switch off. There’s a massive cost to both shutting down and restarting these assets. With the Government’s push toward de-carbonisation (noting that Huntley is now burning coal by the ship full) it must surely be plainly obvious that relying on electricity to be the vehicle for the fossil fuel divorce is like relying on Biden to get his own name right. So, with electricity and gas supply and price instability, it doesn’t take a rocket scientist to figure out that we need another form of fuel to keep all manner of industries in operation. Don’t Stress NZ, we’ve got this. Woodfibre based biofuel is the future of large-scale industrial fuel. Unlike electricity, it won’t hold you to ransom in a dry, windless winter and doesn’t carry the same level of sovereign supply risk that saw an end to gas exploration under the previous Government. Long term supply is easy to see – it’s growing in every forest. Marcus Musson is a Forest360 Director. He holds a Bachelor of Forest Science with Honours from Canterbury University, New Zealand, and specialises in steep slope cable harvesting, marketing and value recovery initiatives.

The Australian Forest Products Association has welcomed the Federal Government’s consultation process on new draft rules that complement the national illegal logging reforms, to allow for industry feedback. Source: Timberbiz The AFPA supports the strengthening of illegal logging laws to ensure that importing businesses source timber harvested from legal sources using sustainable practices. Equally important is the need for the regime to be efficient, practical and effective and the consultation process will be important to allow industry the opportunity to provide feedback. Agriculture, Fisheries and Forestry Minister Julie Collins has announced the next steps for the Government’s reforms around the Illegal Logging Prohibition Amendment (Strengthening Measures to Prevent Illegal Timber Trade) Bill 2024 which includes an opportunity for stakeholders to comment on draft rules before they’re finalised. The updated illegal logging laws which are currently before the Senate, will: Strengthen audit, compliance and enforcement of offence penalties, Enhance monitoring of compliance and streamline investigation powers, Require notice of products being brought into Australia. “Illegal logging has negative effects on supply chains, business decisions, industry profitability, investment, and jobs in the Australian economy,” Ms Collins said. “These rules will help to protect the sustainability of this industry, and the workforce involved, and secure stronger economic growth. “It’s important that we get feedback from regulated entities and other stakeholders on the draft rules,” she said. This would ensure the government was striking the right balance of reducing the regulatory burden and upholding the objectives of the legislation to prevent illegally logged timber entering our market. “Australia’s forest industries unequivocally support a strong and robust regime to combat illegal logging, and we thank the Government for the consultation that will allow industry to provide feedback to policy makers on the new rules,” Chief Executive Officer of AFPA Diana Hallam said. “These reforms are particularly timely. As a result of native forestry industry closures in Victoria and Western Australia, Australia has seen a considerable increase in the volume of imported hardwoods and it’s critical the proper checks, enforcement and penalties are in place if there’s any doubt as to the source. “The integrity of our timber and fibre products is paramount. When grown, harvested and processed properly, as we do in Australia, these products represent the height of sustainability, but when corners are cut, it can be environmentally damaging and undermine Australian jobs,” she said. Comment on the draft rules can be made via the link below until 13 September 2024: https://haveyoursay.agriculture.gov.au