Issue 126

6465

AFS/01-10-01 www.forestrystandard.org.au

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issue 126 | 24.05.10 | Page 1

It’s wait and see on plantation sale

This Issue • Wide interest in Gunns’ native forest sale • Industry condemns red gum decision

Short on detail until settlement in June as Hancock prepares to take over FPQ

By JIM BOWDEN

THE sale of Queensland’s forest plantation assets, knocked down to new entity Hancock Queensland Plantations for a better-than-expected $603 million last week, appears to be a good deal for the state’s timber industry.

The buyer, a company managed by the Boston, USA-based Hancock Timber Resource Group on behalf of institutional investors, has won the right to grow and harvest the softwood and hardwood timber on the 203,000 ha estate in a 99-year lease arrangement.

Queensland plantations .. sold at a good price.

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The sale includes about 35,000 ha of freehold land.

“We know the buyer – they are one of our members – and on the face of it, it seems like a good price,” the chief executive of Timber Queensland Rod McInnes said.

“Hancock is an excellent company with a good international reputation, so we’re looking forward to talking with them about planning the industry’s future,” he said.

“Our experience with them and our knowledge of them in other Cont Page 3

supply chain partnerships forged at Melbourne seminar • Hoo-Hoo helps fund industry’s bushfires hearing • TimTech-Kemira share technology

 Strong

www.timberawards.com.au

issue 126 | 24.05.10 | Page 1

industry news

Hoo-Hoo donates Making funds to assist in an bushfires hearing impact ..

The Victorian Association of Forest Industries, representing the interests of the Victorian timber Industry

Victorian Association of Forest Industries Level 2, 2 Market Street Melbourne 3000 Tel: +61 3 9611 9000 Fax: +61 3 9611 9011 Email: info@vafi.org.au Web: www.vafi.org.au

Page 2 | issue 126 | 24.05.10

THE Hoo-Hoo movement in Australia is contributing to the high costs associated with putting the forest industry’s case before the Victorian Bushfires Royal Commission.

A cheque for $1000 presented by the Jurisdiction 1V division of Hoo-Hoo International, which represents Australia, New Zealand, Malaysia and South Africa, was backed by a $2000 individual donation from Brisbane Hoo-Hoo Club 218.

The case centred on fuel reduction and land management and was put to the commission by the Victorian Association of Forest Industries on behalf of the entire Australian forest industry.

The September 2009 Black Saturday fires claimed 173 lives – the highest ever loss of life from a bushfire – and burnt out 450,000 ha, including more than 7000 ha of forest plantations.

But the appearance of VAFI before the royal commissions came at a cost – expected to be upwards of $40,000 to provide the information requested by the commission.

The National Association of Forest Industries, Timber Merchants Association (Victoria) and Wood Products

Australia also assisted VAFI in its submissions to the council.

“We are deeply appreciative of Hoo-Hoo’s support and I can fully appreciate the organisation’s spirit, its ideal and its nine fundamental values which include being ‘helpful, friendly, tolerant, industrious and ethical’,” the chief executive of VAFI Philip Dalidakis said.

Brisbane Hoo-Hoo Club president and J1V second vicepresident Pieter Verlinden said members were unanimously supportive of the industry’s case put to the commission on bushfires.

“The club was most happy to contribute to the strong message delivered by VAFI on behalf of our industry,” he said.

In one of the most detailed and researched documents delivered to the royal commission in Melbourne, the timber industry’s 10,000word, 128-point statement strengthened the case for prescribed burning and fuel reduction in forests.

In a witness statement on behalf of the national industry, Lisa Marty, VAFI deputy chief executive, said industry

across Australia’s forest and forest products industry .. since 1940 The Timber & Building Materials Association is Australia’s most progressive timber association and the only true national timber association.

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Hoo-Hoo vicegerent Area 3 (Victoria) John Dehne, representing HHI J1V (left), presents a cheque to Philip Dalidakis, chief executive of the Victorian Association of Forest Industries in Melbourne.

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industry news

Industry still nervous on fate of freehold land in plantation deal From Page 1

areas, particularly in Victoria where they’ve been running the whole Victorian Government plantations for some time, is that they’re good people to do business with.”

But until the sale settlement, expected in June, Hancock Victoria Plantations remains tight-lipped on its future plantations operation strategy in Queensland.

Chief executive Linda Sewell left for New Zealand two days after the announcement and the company is making no comments at this time.

The Queensland government says it will honour two key planks of its sale, despite concerns held by the industry

Rod McInnes .. assessing industry’s future.

Linda Sewell .. expand to remain competitive.

– that all plantation timber land will continue to be used for forestry, and not housing development, and the 1999 commitment to a hardwood plantation will be honoured.

“There is no risk to industry about replanting on Crown land, but there is still some uncertainty, some nervousness, about the freehold land component in the sale,” Mr McInnes said.

“Until we can sit down with the buyer it’s still a question about the detail.”

Industry observers say that if Hancock astutely addresses the two major concerns – availability of resource and no hikes in log prices – then industry stability can be expected.

There are still major fears about the freehold component of the sale. This contains many trees, and depending on its location, the value of the land for real estate is very attractive and worth a lot more than just a buffer zone. When current rotations on this land mature, it will be a question of whether to replant.

The FPQ sale is the first of the five commercial businesses to be sold, licensed or leased to the private sector, as the government reforms the state balance sheet. The Treasurer Andrew Fraser has assured award staff their jobs are guaranteed for three years.

Although there will be no forced redundancies, it will be

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surprising if no one asks for a redundancy package.

Speaking at the Forest Future conference in Canberra in November last year, Linda Sewell said the wood processing industry faced a significant supply shortfall which could have a long-term devastating impact on Australian industry, if not addressed.

“We need to plant trees now if we are to reduce the shortfall predicted in 2040. It is not an overnight solution,” she said.

“Despite the 2020 Vision, the large amount of capital raised by management investment schemes and the almost doubling of the plantation estate from 1 million ha in 1994 to 2 million ha in 2008, Australia’s area of softwood plantations remains virtually unchanged.”

Ms Sewell said the plantation area had only increased by 130,000 ha in 14 years – less than 10,000 ha a year.

“The tide is turning; there is no longer a surplus of logs, specifically long rotation softwood logs. In fact, it’s quite the opposite,” she said.

“I would hazard a guess that over 90% of the national estate is already committed to customers under medium to long-term supply contracts.”

Ms Sewell said although the national plantation estate had been growing, it had predominantly been in short rotation hardwood, and his had not helped the large amount of processors committed to long rotation softwood.

“They need to expand to remain competitive. To expand, they need more logs.”

Ms Sewell said foresters for a long time had known that the national plantation estate had to increase in size. “But until Cont Page 4

issue 126 | 24.05.10 | Page 3

industry news

Shift in supply-demand balance of logs From Page 3

recently, it has only been an issue raised and understood by forest growers.”

She said what used to be a forest grower’s strategic issue was now the issue for the extended supply chain.

Ms Sewell expressed why she believed there had been a complete and fundamental shift in the supply-demand balance of logs in Australia: “The increase in demand is driven by both sawlog and pulp log.

“It is now estimated that the housing stock deficiency built up due to low construction levels in recent years is now equivalent to about one year’s demand.

“With increasing population, increased house sizes and changing demographics, this steady increase in demand is projected to continue with a projected shortfall of between

1 million and 2.5 million cub m a year by 2040.

“And the domestic demand for pulp log has also increased.”

Why has there been no demonstrable growth in the estate in the last decade? Ms Sewell contends: Firstly, 75% of the estate is government owned.

With competing priorities for public funds, it is challenging to maintain the estate, let alone increase its size; Secondly, it is almost impossible to get an acceptable return on building a greenfield plantation,

given rising land values; Thirdly, whatever investment has been raised by the industry has been channelled towards shorter rotation bluegums. It is very hard for long run rotations to be as attractive as their shorter rotation counterparts.

Hence the reason for the bulk of the national estate being in national hands; Finally, every year the national estate shrinks a little more in size through a raft of environmental or planning issues.

“As an example, at HVP Plantations we lose areas

Uncertainty about the future of freehold land in the sale,” Mr McInnes said.

every year due to compulsory acquisitions by local government, increased buffer zones for environmental protection and urban encroachment,” Mr Sewell said.

Melbourne-based HVP is Australia’s largest private timber plantation company, with more than $800 million in assets. The company is owned jointly by Australian and US superannuation and investment funds.

Based in Boston, USA, the Hancock Timber Resource Group acts as overseeing manager on behalf of investors.

HTRG executives also represent US investors on the HVP board.

HVP manages around 245,000 ha of land across Victoria, including 50,000 ha of native vegetation for conservation.

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Page 4 | issue 126 | 24.05.10

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events

WHAT’S ON? MAY 2010

JULY 2010

24-25: Wood Supply Chain Optimisation 2010, Rotorua, NZ. www.vafi.org.au

1: Bio-energy Under the Microscope: Fact or Fiction?

Brisbane. Unsure how the burgeoning bio-energy market can deliver a return to your business? Attend this Timber Queensland event to ensure you are positioned to capitalise on the emerging opportunities for the timber industry. www.timberqueensland.com.au/ events

3: Australian Forest Contractors Association harvest and haul conference and trade exhibition.

Novotel Resort, Coffs Harbour.

Registerations: David Drane on 0413 997 257 or email david.d@vic. australis.com.au 3-4: AFCA Conference and Trade Expo, Novotel Resort, Coffs Harbor, NSW. www.afca.asn.au 4: Plantation Thinning and Pruning - Farm Forestry Research Seminar. 10 am DPI Attwood, Melbourne. Contact Rhodey Bowman. Tel: 0358 335957. Email: rhodey.bowman@ dpi.vic.gov.au.

18-20: Timber and Working with Wood Expo, Sydney Entertainment Centre, Sydney.

21-22: Frame Australia 2010 Conference: Housing Construction and Sustainability.

Sofitel Melbourne. The major national event for engineered timber and pre-fabrication. View: www.frameaustralia.com.au 21-22: Skills Tasmania Conference, Hobart. Showcasing workforce development and planning.

June 28-July 2: 18th Commonwealth Forestry Conference, Edinburgh, Scotland. www.cfc2010.org

7-9: Wood Manufacturing 2010.

Profitable Wood Manufacturing: Tooling, Technology & Design. Rotorua, NZ. www. woodmanufacturingevents.com 8-10: AFAC bushfire CRC annual conference. Darwin Convention Centre Australia. www.afac10.org

14-18: Interforest 2010 Trade Fair for Forestry Technology Munich, Germany. www.interfrost.de

13-15: Wood Manufacturing 2010. Profitable Wood Manufacturing: Tooling, Technology & Design. Melbourne. www.woodmanufacturingevents.com

21-22: Wood Energy 2010 reducing energy costs and improving energy efficiencies.

Rotorua, NZ.

15-16: Wood Manufacturing 2010 Profitable Wood Manufacturing - Tooling Technology & Design, Melbourne.

21-22: ScanTECH 2010 Sawmill Scanning & Optimisation Technologies. Rotorua, NZ. www. scantechevents.com

20-21: Wood Manufacturing 2010 Profitable Wood Manufacturing - Tooling Technology & Design Rotorua, NZ.

26-27: ScanTECH 2010 Sawmill Scanning & Optimisation Technologies. Melbourne. www. scantechevents.com

30-2 October: The Future of Forestry and Forest Science Conference. Celebrating the centenary of forestry education in Australia. Sydney Myer Asia Centre Carrillo Gantner Theatre, Melbourne University. Contact: Event Planners Australia forestry.

Email: 2010@eventplanners.com.au

26-27: Wood Energy 2010 (World Reducing Energy Costs & Improving Energy Efficiencies) Melbourne.

26-29: Combined workshop. ATTA / FIAPS / ForestWorks combined annual workshop Hobart. Details: www.atta.org.au

SEPTEMBER 2010 3-5: Canberra Timber & Working With Wood Expo, Exhibition Park in Canberra.

Contact: (02) 9974 1393.

Fax: (02)9974 3426 Email: info@eee.net.au

OCTOBER 2010

10-13: Australian Forest Growers national conference, Mount Gambier, SA. Chief executive Warwick Ragg. Contact national office: (02) 6162 9000.

15-17: Melbourne Timber and Working with Wood Expo, Melbourne Showground, Melbourne. Contact: (02) 9974 1393. Fax: (02)9974 3426 Email: info@eee.net.au

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SUSTAINABLE. sustainable. responsible. .

RESPONSIBLE The National The National Association of of Forest Association Industries (NAFI) Forest Industries (NAFI) represents is striving for an Australian companies, ecologically sustainable individualssociety and Australian organisations involved achieved through in thedynamic, forestry and forest products internationally industries. competitive forest industries.

NAFI works with state and

2010

JUNE 2010

6-12: Landcare Week. www.landcareonline.com

federal governments to support interestsis of to its NAFI’sthemission members while the same represent theatinterests time improving industry of members by standards and practices, promoting the promoting sustainable environmental forestry management and educating the broader sustainability and community on theof the prosperity economic, environment Australian forest and social benefits of industries. a strong sustainable forest industry.

National Association of The National Association Forest Industries Ltd of Forest Industries (Est. 1987) Ltd (EST.1987) PO Box 239, PO Box 239, Deakin ACT 2600 Deakin, ACT 2600 Tel: (02) 6285 3833.

Tel: (02) 6285 3833 Fax: (02) 6285 3855 Fax: (02) 6285 3855 Web: www.nafi.com.au www.nafi.com.au Web:

issue 126 | 24.05.10 | Page 5

industry news

Mount Gambier Hoo-Hoo Club president Maurie Drewer and forestry course convenor Diana Lloyd present scholarships to forestry students, from left, Michael Dent, Keith Atkinson and Lauren Kentish. Student Sophie Schultz was unable to attend.

Ladkin scholars receive $4000 in Hoo-Hoo funding

From BRIAN PAGE

FOUR forestry students were each presented with a $1000 scholarship at a special meeting of Mount Gambier Hoo-Hoo Club 214 this month.

Club president Maurie Drewer said the scholarships were funded by the Norton Ladkin Memorial Fund which recognised the contribution to industry by this respected South Australian timber industry.

“Norton’s motto was, ‘what the mind can perceive, the body can perform’. The Hoo-Hoo movement is proud to support these scholarships in their fourth year of presentation,” Mr Drewer said.

This year’s scholarship winners from the Southern Cross University’s Mount Gambier campus are Lauren Kentish, Keith Atkinson, Michael Dent and Sophie Schultz.

SCU forestry course convenor Diana Lloyd said the fist four students in forestry graduated this year, and that 36 students were currently studying forestry at the local campus.

Gottstein Fellowship recipient Dr Jim O’Hehir, executive general manager, planning and development, Forestry SA, delivered the keynote address

Page 6 | issue 126 | 24.05.10

Dr Jim O’Hehir .. South African experience.

at the meeting – The South African Forestry Industry: Similarities and Differences.

The address gave the gathering a broad picture of the South African forestry industry, particularly the application of precision forestry practices including terrestrial laser scanning of incoming wood from plantations, wood harvesting controls, tracking logs in the supply chain and GPS systems and their need to be able to work under forest canopies.

Hadyn Dow, a recent graduate, addressed the meeting about his own study and the value and support he had received from his scholarship.

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industry news

Wide interest in native forest sale AS Gunns Ltd was suffering severe losses on Australian Securities Exchange late last week, property agents released more detail on the sale of 28,000 ha of native forest the Tasmanian company is to sell at auction.

Gunns’ shares dropped 8.6% to close at 37c on May 20, after three consecutive days of falls.

The drop coincides with an announcement by IMF Australia that it may pursue a class action against Gunns, centred on Gunns’ alleged failure to keep the market adequately informed about a 98% fall in half-year profit.

The forest sale, prompted by Gunns’ desire for social licence, comprises 106 titles ranging from 80 ha to 4000 ha.

Analysts Bell Potter in a media report predicted a price of $1000-$1500 a hectare, a total of $28-$42 million for the native forest blocks.

Harcourts Rural director Michael Warren said he had been surprised by the amount and the variety in interest.

“We have had five or six hits on our website from North America and half a dozen phone calls from Europe,” he said.

“Interest has been coming from farmers, people with leisure interests such as hunters and fishermen, conservationists, investors and people with a

forestry background.

“We have never seen this sort of land sold in this amount in Tasmania before,” he said.

The blocks will be sold by auction at Burnie on June 24 and Launceston on June 25.

Meanwhile, Forestry Tasmania stands ready to play a constructive role in the development of a new blueprint to guide the forest industry into the future.

“It is abundantly clear that the industry shakeout we are experiencing has led to a mood for change – change that can delivered through goodwill on all sides,” managing director Bob Gordon said.

“By gathering the stakeholders together, the prospects for achieving consensus are greatly enhanced.”

He said Forestry Tasmania was a major contributor to the state’s economy, directly employing 500 staff, 1200 contractors and injecting about $184 million into the state economy through payments to suppliers, staff and contractors.

“The industry shakeout, brought on by the global financial crisis and the collapse of managed investment schemes has caused considerable hardship, but I am confident the industry can emerge stronger and more resilient,” Mr Gordon said.

Bob Gordon .. confident the industry can emerge stronger.

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issue 126 | 24.05.10 | Page 7

industry news

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THE federal government will provide support for six agricultural delegations to visit China to explore market opportunities for products – including timber.

The Minister for Agriculture and Forestry Tony Burke announced the six successful projects under the latest round of Australia’s agribusiness program with China, the Australia-China Agricultural Cooperation Agreement (ACACA) program.

The industry delegations will each visit China for up to two weeks over the next 18 months to make new contacts and to develop export opportunities.

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Page 8 | issue 126 | 24.05.10

teams invaluable insights that can really make the difference to how they approach the Chinese market,” Mr Burke said.

The ACACA program is jointly managed and funded by Australia’s Department of Agriculture, Fisheries and Forestry and China’s Ministry of Agriculture.

Since it was established in 1984, more than 200 delegations have been funded in sectors including beef, wool, dairy, horticulture, fisheries, forestry and food safety.

The next funding round in 201112 will be advertised in late 2010. For information on how to apply visit www.daff.gov.aui

FWPA is committed to helping the industry be collaborative, innovative, sustainable and competitive. Company members are wood processors, forest growers, and importers of wood products. As a rural research and development corporation, the Company also receives matching funds from the Commonwealth government for its R&D activities.

An independent Director Selection Committee established under the Company’s Constitution will consider proposals for candidates, and recommend to the FWPA Board persons for nomination for appointment as a Director. The Committee is required to ensure that

candidates will result in a balanced, skills-based Board.

Information about FWPA and the process for appointing Directors is set out in FWPA’s Constitution, available from the company’s website at www.fwpa.com.au All candidates should: b provide sufficient information to allow the Director Selection Committee to fully consider the candidate’s nomination; b include specific information about the candidate’s ability to meet one or more of the requisite skills and experience nominated in FWPA’s Constitution (clause 13.13); and b include a statement that the proposed candidate is aware of his or her nomination and is willing to accept appointment as a Director of FWPA if elected.

Applications will only be received by email and should be sent to the Secretary, Director Selection Committee at: rob.lockwood@fwpa.com.au Enquiries can be made to 0419 259 481 Please note the closing date for applications is Friday 4th June 2010

editorial inquiries tel: +61 3256 1779

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HEAD OFFICE Custom Publishing Group Unit 2- 3986 Pacific Highway Loganholme 4129 Qld, Australia RON EDDY, managing director of TimTech International Ltd (left) and Pekka Johnsson, general manager, business development and strategy for Finland’s Kemira Oyj Group, shake hands in Helsinki this month after signing an agreement that gives TimTech exclusive rights to manufacture and market Kemira wood protection products in Australasia.

Included in the agreement are new technology boron chemistry and Freezium, a spray-on fire retardant used to combat large forest fires, as fire protection for the military in combat – and as protection for houses against bushfires.

TimTech and Kemira have been working together for two years promoting Guardian Fire and Guardian timber, a fire retardant for wood and a timber stabiliser respectively.

“We are pleased to have progressed our international relationship with Kemira,” Ron Eddy said.

“The new formulations add strength to our portfolio of value adding products.”

Kemira’s Pekka Johnsson

was also pleased with the strengthening of relationships.

“We get on very well with TimTech as they share the same values as we do at Kemira. We look forward to developing the Australasian market with these products which are well known and very successful in Europe.”

Kemira operates in water and fibre management chemistry.

In 2008, the company recorded revenue of more than $A4.2 billion. It operates in 40 countries and has a staff of 9400.

TimTech’s alliance with Kemira adds to its exclusive association with leading German wood protection company Dr. Wolman GmbH, a member of the multibillion-dollar BASF Group and exclusive rights to market their patented new wood protection products in Australasia.

TimTech Chemicals Ltd was launched in New Zealand in 2001 and in Australia a year later. The company supplies wood protection products, plant and equipment and technical services to many of the leading timber companies in Australasia and the Pacific Islands.

Advertising: Tel +61 7 3256 1779 Email: cancon@bigpond.net.au

PUBLISHER Dennis Macready admin@industryenews.com.au CONSULTING EDITOR Jim Bowden Tel: +61 7 3256 1779 Mob: 0401 312 087 cancon@bigpond.net.au ADVERTISING Tel: +61 7 3256 1779 cancon@bigpond.net.au PRODUCTION MANAGER Leigh Macready Tel: +61 7 3841 8075 production@industryenews.com.au

Opinions expressed on Timber & Forestry e news are not necessarily the opinions of the editor, publisher or staff. We do not accept responsibility for any damage resulting from inaccuracies in editorial or advertising.

The Publisher is therefore indemnified against all actions, suits, claims or damages resulting from content on this e news. Content cannot be reproduced without the prior consent of the Publisher- Custom Publishing Group.

issue 126 | 24.05.10 | Page 9

industry news

Industry condemns red gum decision THE NSW government’s decision to create red gum national parks devastates an important regional industry sector and will cause severe social and economic impacts in the timber communities of the Riverina.

Executive director of the NSW Forest Products Association Russ Ainley said the industry had spent weeks haggling with minister Frank Sartor to try to find a workable solution, to provide fair and just compensation and establish alternative jobs.

“But he is adamant that a deal with the Greens is needed for the next election – so the people of the Riverina can be traded for the Sydney seat of Balmain. Apparently, looking after the health of the forests does not count for much at all,” Mr Ainley said.

“An improved assistance package is still a long way short of a fair and just outcome for the affected people of the Riverina. The package provides no positive future for the communities.”

Mr Ainley said the outcome was still bitterly disappointing for workers, mills and communities in the region because: • The jobs are gone, the businesses will be closed and an industry worth $72 million is scrapped.

Russ Ainley .. industry traded for green seats.

• Workers will be paid $81,360 as a handout and lose their job. They will have to move elsewhere to try to seek employment.

• Timber businesses will be paid a total of $25 million as compensation for making $68 million of equipment obsolete.

• The communities will get $20 million to develop and invest in employment alternatives to replace the $72 million industry that used to exist.

• National parks will spend $35.5 million to earn $2.8 million a year as additional tourist value and replace an industry worth $72 million a year.

The Natural Resources Commission identified water and active forest management as necessary to maintain healthy red gum forests. Forest

industries have managed the red gum forests for 150 years and sustained all the values that exist there today. Creating a big national park does none of that.

“Frank Sartor has now placed it all under threat of neglect and bushfire,” Mr Ainley said.

“Victoria’s red gum parks and Yanga national park in New South Wales stand as stark testimony of national park neglect.”

Mr Ainley said the NRC could not determine a sustainable timber yield and after five attempts they ended up advising twice their original estimate, and then they failed to include 21,000 ha of forest.

“The vague and useless report of the NRC had been used as

the excuse for this devastating decision,” Mr Ainley said.

The real reason is green preferences for the next election.

“Country people and communities in NSW are expendable.

“What happened to the Premier’s priorities for jobs and communities? They simply do not apply in country areas.

In all her travels around New South Wales, she has carefully avoided the people in the Riverina.

“The welfare of the people and the communities of the Riverina now lie squarely on the conscience of Frank Sartor and Kristina Keneally.

“We hope the forests might survive – the people cannot.”

Commission’s final report in July From Page 2

believed prescribed burning was one of the most cost and risk-effective measures for mitigating wildfires.

“Broad area prescribed burning changes a number of fuel characteristics that will result in reduced rate of spread, reduced spotting, reduced flame heights, reduced fire intensity and increased ease of suppression for a period of time following the burn,” Ms Marty

reported.

The royal commission was established on February 16 last year to investigate the causes and responses to the Black Saturday bushfires that swept through parts of Victoria.

The commission delivered its interim report on August 17 last year and a final report is due in July.

Outcomes will affect forest fires strategies in all states and territories.

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Page 10 | issue 126 | 24.05.10

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events

Strong supply chain partnerships forged at busy Melbourne seminar

By JIM BOWDEN

MORE than 80 key players in the business of getting raw material to the end user as a finished product forged new strong partnerships at a successful timber supply chain seminar in Melbourne last week.

The seminar at the Radisson Hotel on May 18 was a tribute to the vision of the three main sponsors – the Timber Merchants Association, the Australian Timber Importers Federation and the Window and Door Industry Council who set out to ‘connect the pieces’ in the supply chain.

This chain involves forest owners, machine entrepreneurs, wood buyers, sawmillers, merchants and transporters, linked together through a complex production and business network. Efficient and market driven operations within this network are vitally important, particularly in the face of increasing international competition.

Delegates from four states and New Zealand were rewarded with a panel of highcalibre speakers representing the industry in Australasia, Singapore and Canada.

[T&F enews will give greater

Opening speaker at the supply chain seminar Philip Dalidakis, chief executive, Victorian Association of Forest Industries, Melbourne (left), talks over the program with Timber Merchants Association executives Ron Caddy, president, and Peter Roberts, executive director.

Mr Dalidakis said the Victorian timber industry strategy would provide industry with ability to secure timber resource for up to 20 years. “This has supplied the industry with the much-needed longterm certainty for new and increased capital investment and brings Victoria into line with other jurisdictions,” Mr Dalidakis said.

“We also acknowledge timber plantations as an ‘as of right crop’ and that in certain circumstances no planning permits should be required.”

He said the timber industry strategy was a positive step in the right direction. ”But as an industry we need to support certification as distinct from non-certification, instead of fighting over who has the best certification scheme.”

coverage to these presentations over future issues].

A busy and packed program embraced global wood

movements and trends, market opportunities, certification, codes and standards, training skills, housing, illegal logging

and DNA tracking systems, and the Wood Naturally Better campaign.

“It got industry people rethinking and the day achieved what we set out to achieve,” TMA president Ron Caddy said.

“It was about partnerships, industry stakeholders working together instead of going off on their own.”

The seminar proved supply chain management is a hot topic from bush operations to processing and distribution. It allowed delegates to examine how they secure all the materials needed to operate efficiently and profitably.

Seminar speakers agreed timber businesses today must focus much more on market forces as a key driver of production forces; the end user or the final customer becomes the most important factor in business decisions.

True supply chain management examines exchanges all along the value chain, in both directions but it should not leave out the key driver of a successful business, the final customer.

Cont Page 12

If it’s your timber, make sure it’s in the competition.

Ring the architect, builder or owner; pay the fee; organise the photos.

The 2010 Australian Timber Design Awards is your chance to have your timber products showcased. If you’ve supplied timber or timber products to an eye-catching house, office block or resort development, make sure your contact knows about the Timber Design Awards. Let us know about the project by email at info@timberawards.com.au

ENTRY FORMS AND INFO AVAILABLE AT

www.timberawards.com.au Entries close 16 July

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issue 126 | 24.05.10 | Page 11

events

Sophisticated supply chain systems are giving consumers more product choices From Page 11

The seminar sent out a strong message: It is important to understand where you, as a manufacturer or merchant, fit into the value chain, to ensure that the value you add continues to be important both for your business and your direct customers.

Focusing on engineered wood products, Glenn Tilling, managing director of Tilling Timber, said sophisticated supply chain systems were giving consumers more product choices and were assisting in market share increase for EWPs. EWPS were now globally resourced products depending on the best raw material availability and the location of cutting edge manufacturing infrastructure.

“EWP wholesalers are increasingly being asked to carry out on-site deliveries,” Mr Tilling said.

This was more prevalent in New South Wales where the major truss plants servicing the project builder tended to be located well outside the Sydney basin. The long length nature of EWPs often required 12 m semi trailer crane trucks – rarely available to timber merchants.

Also, rebates would continue to play a significant role in supply chain dynamics Mr Tilling reported spectacular growth in the consumption of LVL and I-joists in the past six years, forecast to grow at similar rates up until 2013 and beyond.

Volume usage figures on structural LVL, glulam and I-joists in Australasia showed a rise from 243,000 cub m in 2004 to 312,000 cub m in 2008 with forecasts of 331,000 cub m in 2010 and 405,000 cub m in 2013.

LVL usage showed 145,000 cub

Page 12 | issue 126 | 24.05.10

Talking timber branding and certification at the seminar are Nigel Wilshier, joint owner and managing director, OTC Timber Co, Otorohanga, NZ, Paul Elsmore, chief executive, Simmons Lumber, and Darren Thomas, managing director, Double Helix Tracking Technologies, Singapore.

Mr Wilshier launched the PINENZ Quality Mark at the seminar. The brand recognises finger-jointed or laminated pine products, both treated primed and interior finishings, for use only by manufacturers whose products meet high Australasian industry standards.

m in 2004, rising to 198,000 cub m in 2008 with forecasts of 218,000 cub m in 2010 and 272,000 cub m in 2013.

Mr Tilling said new, stronger and better value products had resulted in more market share for EWPs over solid timber competitors.

EWPS were now more prevalent as a stock line with merchants and detailing was now far more complex and internationally resourced.

Manufacturing plants were located close to the best possible raw materials.

LVL18 is picking up market share in the frame and truss sector The grades of LVL have been refined to the point where Tilling is now offering LVL15 (in lieu of LVL13 or 14) and LVL18 for residential construction and LVL9 and 11 for formwork and civil construction.

The product is soon to be sized in 35, 42 and 58 mm

thicknesses instead of 36, 45 and 63 mm while 75 mm remains unchanged.

This allows the product to be easily substituted for F17 across sizes.

Mr Tilling said LVL was becoming more commonly stocked by the merchant sector as replacement for or as an option to F17 hardwood.

More pictures Page 14 and 15 He said the frame and truss sector was stocking the product more frequently for lintels in wall frame production as well as its traditional use as a bottom chord product.

LVL18 was picking up market share in the frame and truss sector and I-joists continued to gain market share from floor trusses in the more price sensitive market segments.

Stock holders were using the better pack pricing to win work where merchant margins were

tight.

Mr Tilling said raw material cost increase in both New Zealand and Northern America should see prices trending up in the later half of this calendar year for both local and imported EWPs. This was mainly due to the market pressure caused by the recent Chilean earthquakes.

A survey by URS Forestry suggests structural softwood timber prices have risen by 1% to 3.4% and F17 and F27 hardwood has risen by up to 4.6%.

On the subject of chain of custody, Mr Tilling said the system was a complex issue that the industry was struggling to come to terms with.

“A key finding within our industry appears to be the further down the supply chain the more complex the systems appear,” he said.

“It appears that the cost to business is great, yet there is no general consensus that any increases in cost to consumers for ‘green products’ are being passed forward. Therefore, each link burdens the cost.”

Mr Tillling said each business needed to consider the risk factors for and against CoC implementation.

“The greatest risk factor appears to be not having CoC. It now becomes a game day factor!

“Product may then be rejected from projects as the ‘green wave’ of change rolls in.”

He said supply chain readiness in terms of CoC was improving.

In order to derive absolute value for CoC systems implementation, each link in the supply chain must have individual CoC certification.

Those at the secondary or tertiary level in the supply chain were driving the change at both ends.

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forestry

Trees gift celebrates Arbor Day in WA

THE Forest Products Commission in Western Australia plans to grow the benefits of native trees by celebrating Arbor Day 2010 with a give-away of thousands of seedlings.

FPC general manager operations Gavin Butcher said

MicroPro

®

more than 5000 seedlings would be made available to householders, schools and community-based organisations as part of the commission’s ‘re-Leaf WA’ program.

The program is helping the public to make important

MicroPro, a Better Earth Idea from Osmosesm

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connections between the state’s sustainable forestry industry and its shared environmental future.

“The program cuts through complex terminology to explain forestry’s most important messages such as sustainability, regeneration,

ILA A V A W

carbon sequestration and water catchment protection,” Mr Butcher said.

“The ‘re-Leaf WA’ program also encourages direct involvement with trees by motivating the public to plant a native species on their property.

“It makes sense to promote opportunities for tree planting and at the same time enhance Arbor Day festivities on June 11.

AUSTRALIA! N I E BL Motivating public to plant native trees.

Just Go t ood W

G

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r sm

Treated

er & Fastenre r e t t e a B Hardwance** m r o f r Pe

Visit: www.osmose.com.au or phone: 1800 088 809 Osmose® and MicroPro® are registered trademarks of Osmose, Inc. or its subsidiaries. A Better Earth Idea from Osmose sm and Treated Wood Just Got Greener sm are slogan marks of Osmose Inc and its subsidiaries. MicroPro timber products are produced by independently owned and operated wood preserving facilities. GREENGUARD® is a registered trademark of GREENGUARD Environmental Institute. * See separate limited guarantee document for more details. ** See MicroPro fastener and hardware information sheet. © 2010 Osmose, Inc._002_0410

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“Until stocks are depleted, quantities of red flowering gum, claw honey myrtle, York gum, coastal moort, granite honey myrtle, blue mallee and bottle brush will be available free-ofcharge.”

Mr Butcher said the role of trees in absorbing carbon dioxide was acknowledged around the world. However, the role of wood products as long-term carbon vaults deserved more recognition.

“Trees at the mature growth stage have greater capacity to absorb carbon dioxide from the atmosphere than young trees or post-mature trees, because the growth rates of the latter slow considerably after reaching maturity.

“Timber products used in housing construction can store carbon for as long as the material remains in use. Many stately homes in Europe proudly exhibit panelling, furniture and staircases which originated in Western Australian native forests more than 100 years ago.”

issue 126 | 24.05.10 | Page 13

FOCUS ON SUPPLY CHAIN SEMINAR

Delegates and speakers .. Sarah Gyopar, marketing and communications manger, Forest and Wood Products Australia, Ric Sinclair, managing director, FWPA, Kersten Gentle, executive officer, Frame and Truss Manufacturers Association of Australia, and Alastair Woodard, Woods Products Victoria.

Angelo Hrastov, general manager, Arch Wood Production (Aust), Melbourne, shares a coffee break with Angela Reddy, Department Agriculture Fisheries and Forestry, Canberra.

Megan Hurnard, market development manger, New Zealand Trade and Enterprise, Melbourne, and Michelle Kelly, Porta Mouldings.

Goran Runje, Tasman KB, shares a break with Anita and Bill Trengove of Barwon Timber and Hardware, Breakwater, Vic.

Glenn Tilling, managing director, Tilling Timber, Kilsyth, Vic, catches up with Nils Koren, managing director, Gunnersen and chairman of the Australian Timber Importers Federation.

Ingrida Matulis, Timber Merchants Association and TMA executive director Peter Roberts (right) welcome Peter Bradfield of Western Forest Products to the Melbourne supply chain seminar.

Page 14 | issue 126 | 24.05.10

Sharing opinions .. Lawrie Halkett, chief executive, New Zealand Pine Manufacturers Association, Nelson, NZ, Kersten Gentle, executive officer, Frame and Truss Manufacturers Association of Australia, Healesville, Vic, and Neil Evans, standards manger, Forest and Wood Products Australia, Melbourne.

Michael Hartman, chief executive, ForestWorks, Melbourne, discusses the seminar program with John Osmelak, general manager, Furnishing Industry Association of Australia (Vic/Tas).

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FOCUS ON SUPPLY CHAIN SEMINAR

Connecting in Melbourne are Ken and Anne Otto, Otto and Co, Stepney, SA, Lou Boffo, strategy supply manger, Le Messurier Timber Co, Port Adelaide, SA, and Robert Coleman, High Commission of Canada, Canberra.

Norman Long, managing director, Oceania Forest Products, Robin Hogg, sales manager, and Tony Clifford, CEO, Pacific Wood Products (NZ), Napier, NZ and Anthony Long, Oceania Forest Products.

David Macellari, technical specialist, Henkel Australia, Melbourne, chats with Tony Clifford, chief executive, Pacific Wood Products (NZ), based in Napier, NZ.

Andrew Scane, MiTek Australia, Dandenong South, Vic, Peter Alexander, Peuker & Alexander, Broadmeadows, Vic, and Peter Roberts, seminar co-chairman and executive director, TMA Victoria.

Early to register for the seminar are Steve Bulman, Worldskills Australia, Melbourne, Bronwyn Foord, general manger, Window and Door Industry Council, and Trevor Blake, Just Wood Australia, Dandenong, Vic.

Andrew Ilichmann, group merchandising manager, Dahlsens, Malvern East, Vic and Glenn Tilling, managing director, Tilling Timber, Kilsyth, Vic.

Dr Harley Dale, chief economist, Housing Industry association and John Halkett, seminar co-chairman of the Australian Timber Importers Federation.

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issue 126 | 24.05.10 | Page 15

FOCUS ON SUPPLY CHAIN SEMINAR

Odden lumber destacker/stacker • Heavy Duty Hydraulic Tilt Hoist for Kiln Packs • Fillet Drop-out with Auto Stacker System • Double Un-scrambler • Hi-Speed Stacker • Automatic Stability Fillet Placing • Packet Handling System • Controls and Electrics

Page 16 | issue 126 | 24.05.10

Contact: John McLachlan john@skookum.co.nz +64 274 932 612

Contact: Darren Ousey darreno@skookum.com.au +61 407 041 947

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Chain of Custody I N F O R M AT I O N S E M I N A R

Value• Thursday, RecoveryAugust Officer Brisbane 20, 2009 433 On Logan Conference Centre Company/Location: 433 Logan Road, Stone’s Corner LIMITED TO 60 SEATS Forests NSW - Batemans Bay

Why taking an ad with us is the best value for you!

This important and timely seminar, organised by TABMA Queensland, will help reduce some of the confusion relating to chain of custody. It will ensure the Queensland timber industry has the information required for compliance with legislation,Key speakers will present information Job Description: and there will be a question and answer forum.

Clerk Grade 7/8, Native Forest Operations, Speakers include:

Southern Batemans BayQueensland • Colin MacKenzie, manager,Region, timber application and use, Timber • Simon Dorries, General Package Manager, Engineered Wood Association of Remuneration: valued upProducts to $ 91,779 Australasia (Salary $75,137-$83,171 per annum) • Kayt Watts, chief executive, Australian Forestry Standard Ltd (AFS) • Michael Spencer, chief executive, Forest Stewardship Council (FSC)

Forests NSW sustainably manages more than 2 million hectares and member) planted for a •wide range of Registration of fee:native $65 pp (TABMA $80forests pp (non-member) Includes hot breakfast economic, environmental and social to internationally and morning tea.

Note: Arrival 7:30am.

Breakfast 7:45values am. Presentations begin at 8 am.

RSVP by Friday, August 14, to: As the largest manager of native and recognised standards.

Tabma Queensland, PO Box 532, plantation in NSW, Forests NSW is a major force 500 Brunswickforests Street, Fortitude Valley 4006 (07)state’s 3254 3166.

Fax: (07) industry 3254 4599. which contributes nearly $1 inTel:the timber Mob: 0438 295 136 billion to the NSW economy each year.

www.tabma.com.au

The Value Recovery Officer (VRO) will be the Harvesting Manager’s prime driver for cultural change, to develop strong commercial, value recovery, active management, culture within the harvesting team and a more competitive, self managed contractor workforce providing a more complete set of services.The Value Recovery Officer is responsible for optimising the value recovery from the Forest and for coordinating value recovery along the supply chain. This will require monitoring and assessment of what value opportunities exist, auditing that full value is being recovered and providing training and mentoring to staff and contractors on all aspects of value recovery.

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reach your market weekly s direct delivery s very affordable Advertising: Tel +61 7 3256 1779 Email: cancon@bigpond.net.au

• More than 6,500 deliveries and 15,000 viwers each week • Read and re-read everyday as the most authoritative industry information medium • Best rates, best service - unbeatable • Faster, wider penetration of your message in Australiasia than any other industry publication • Adverts take readers and potential clients direct to websites Contact Timber & Forestry Enews Tel: +61 7 3256 1776 Email: cancon@bigpond.net.au

issue 126 | 24.05.10 | Page 17

Chain Custody SKOOKUMof SPARE PARTS I N F O R M AT I O N S E M I N A R

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This important and timely seminar, organised by TABMA Queensland, will help reduce some of the confusion relating to chain of custody. It will ensure the Queensland timber industry has the information required for compliance with legislation,Key speakers will present information and there will be a question and answer forum.

Speakers include: • Colin MacKenzie, manager, timber application and use, Timber Queensland offers a huge range of Australia •Skookum Simon Dorries, General Manager, Engineered Wood Products Association of Spare Parts including Cambio Ph (1800) 600 053 Australasia parts: •Debarker Kayt Watts, chief executive, Australian Forestry Standard Ltd (AFS) Darren Ousey 0407 041 947 ••Michael Spencer, chief executive, Forest Stewardship Council (FSC) Tool ½” Flange • Tool Shaft Arms Washer New Zealand • Pyramofee: Tips • member) 1” Tenslink Registration $65 pp (TABMA $80 pp (non-member) • Includes hot breakfast Ph +64 9 276 2402 and morning tea. Note: Arrival•7:30am.

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• More than 6,500 deliveries and 15,000 viwers each week • Read and re-read everyday as the most authoritative industry information medium • Best rates, best service - unbeatable • Faster, wider penetration of your message in Australiasia than any other industry publication • Adverts take readers and potential clients direct to websites Contact Timber & Forestry Enews Tel: +61 7 3256 1776 Email: cancon@bigpond.net.au

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for sale reach your market weekly s direct delivery s very affordable Page 18 | issue 126 | 24.05.10

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Timber & Forestry e news is published

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