6838
AFS/01-10-01 www.forestrystandard.org.au
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issue 238 | 10.09.12 | Page 1
Indonesia puts its legality case New era for timber governance as trading partner tests Australian law
Indonesia says its new timber legality system clears the way for the export of products such as merbau flooring.
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World Trade Organisation if Canberra refuses to recognise Indonesia’s timber verification system. The illegal logging Bill was passed in the Lower House of Parliament and the legislation is expected to be debated by the senate later this month. If the law does pass Australia’s upper house, the senate, a twoyear transition period will begin and in that time many of the details will be hammered out. Denny Lesmana, first secretary for Economic Affairs at the Indonesian
Cont Page 4
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issue 238 | 10.09.12 | Page 1
INDUSTRY NEWS
Goran Roos
Joseph Bachman
Jim Henneberry
Brett Himbury
Critical industry issues faced at Canberra forum
ForestWorks lists high-calibre speakers
SKILLS developer ForestWorks and First Super have announced a remarkable final line-up for the 5th annual Industry Development Conference in Canberra on October 30 and 31. Göran Roos, who was recently rated by a leading business journal as one of the world’s 13 most influential thinkers for the 21st century, will present the opening address by video, focusing on ‘the future for Australian wood’. Mr Roos is one of the founders of the modern field of intellectual capital science and a recognised world expert in innovation management and strategy. He is honorary professor at Warwick Business School in the UK and the founder of Intellectual Capital Services Ltd, a leading think tank on technology and business futures. The impressive line-up of influential speakers also includes Joseph F. Bachman, director of portfolio management and partner in Global Forest Partners. In this
‘Times are certainly tough in our industry right now and that’s what makes this conference so vital – Michael Hartman Page 2 | issue 238 | 10.09.12
capacity, Mr Bachman has fund management responsibilities for the New Zealand funds and is involved in the World Timberfund. Prior to joining Global Forest Partners, he served in a variety of forest management positions with then Champion International Corporation. He
also managed Champion’s sustainable forestry Initiative third-party certification program across the company’s domestic forests. Mr Bachman is both a registered and certified forester and is a member of the Society of American Foresters.
Cont Page 6
5th Annual
INDUSTRY DEVELOPMENT CONFERENCE
Forest, Wood, Paper & Timber Products Industry
30 – 31 October 2012 Hotel Hyatt & Parliament House, Canberra Join together Discover & build opportunities to step up the value chain PRESENTED BY
REGISTRATION & QUERIES: Tel: 1800 177 001 Email: cday@forestworks.com.au www.forestworks.com.au/conference2012
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INDUSTRY NEWS
Weyerhaeuser enjoys share rally as US housing industry recovers
Improved markets, prices for North American lumber
BUILDING permits, housing starts and lumber prices are rising in the US, all signs of an emerging recovery in the housing market. Timber giant Weyerhaeuser is also benefiting, as housing accounts for 84% of the company’s revenue. The company’s shares have rallied 50% in the past year, to around $24, and they are expected to keep climbing, according to the Wall Street Journal. “The housing market has bottomed,” says chief financial officer Patricia Bedient. “We are seeing signs of a recovery.” Because Weyerhaeuser’s earnings are depressed after several lean years, the company, based in Federal Way, Washington, is best viewed as an asset play, and its assets are sorely undervalued. Weyerhaeuser owns almost 2.5 million ha of timberland, including some of the best properties in the US – chiefly old-growth forests in the Pacific northwest and the south. It also makes wood products and cellulose fibres used in diapers and feminine-hygiene products, and operates a realestate development company. Some analysts and investors put the company’s net asset value at $31 a share, or about
North American lumber has, to a large extent, been a buyers’ market since the beginning of the financial crisis in 2008, but is now shifting to a sellers’ market in front of a massive demand for wood products.
Recovery .. higher US lumber prices reflected in revived housing market.
year’s earnings could approach 95c a share.
No one expects Weyerhaeuser to earn as much as it reported
Patricia Bedient. .. signs of housing industry recovery.
30% above the current stock price. “Weyerhaeuser is a terrific asset play,” says investor Todd Lowenstein of HighMark Capital Management. “You are buying attractive timber and other housing assets that are under-earning and have been mispriced at the bottom of the cycle, for around 70c on the dollar.” As a timber real-estate investment trust, Weyerhaeuser pays a dividend of 60c and yields 2.4%, with the promise of higher payouts to come. Driven partly by higher lumber prices, Weyerhaeuser could earn 42c a share this year on revenue of $6.7 billion. Next
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at its peak in 2004. But in a more normal housing market, earnings could rise to $1.75 a share. A better market is on its way. North American lumber has, to a large extent, been a buyers’ market since the beginning of the financial crisis in 2008, but is now shifting to a sellers’ market in front of a massive demand for wood products. In May, lumber consumption in the US was 13% higher than in May of 2011. The May 2012 consumption level was actually the highest seen for the month of May since 2008. US demand for lumber is likely to continue to go up in the
Cont Page 11
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issue 238 | 10.09.12 | Page 3
INDUSTRY NEWS
Timber legality system the brainchild of six ministries
From Page 1
Embassy in Canberra, says there are growing concerns by Indonesian stakeholders that the implementation of the regulations may not be in line with the World Trade Orgnisation. He says Indonesia is committed to tackling illegal logging and wants to work with Australia on its new law. In particular, Indonesia wants Australia to recognise its new timber verification system, known as SVLK, which has been accepted by the European Union. “If it is not recognised, I think we’ll take some action,” Mr Lesmana said. [Australia and Indonesia have a healthy trade and economic relationship with two-way trade (merchandise and services) worth $13.8 billion in 2010-11, and two-way investment worth around $5.7 billion in 2010]. Indonesia’s timber legality veritification information system marks the government’s further efforts to .. “improve the country’s timber governance and bureaucratic reform and ensure that the system is credible, transparent, accountable and businessfriendly”. The brainchild of six ministries (forestry, trade, industry, finance, foreign affairs and economic affairs), SVLK also affirms the seriousness of Indonesia to combat illegal logging practices and promote the country’s legal timber to the world. Director of the MultiStakeholder Forestry Program Diah Raharjo explained that for export purposes, industries that have already obtained SVLK certificates will need verified legal (V-legal) documents
Page 4 | issue 238 | 10.09.12
Indonesia wants Australia to recognise its new timber verification system.
stating that the timber products they are exporting have already met timber legality verification standards. These must be compliant with the provisions of the relevant laws and regulations, as well as ensuring that their timber and timber products come from raw materials of legal origin. “The V-legal documents and SVLK certificates are an important instrument in restructuring the country’s forests governance,” Mr Raharjo said. In response to the SVLK, the Ministry of Trade is also amending the Regulation of the Minister of Trade No 20/ 2008 which regulates the country’s timber export licensing policies. The revision process is entering the final stages of consultation and the amendment to the regulation will soon be adopted to provide certainty to the government’s policies on the
Indonesia is committed to tackling illegal logging and wants to work with Australia on its new law
John Tanner .. New Zealand support for Bill – but the detail is missing.
export of legal timber. The Ministry of Forestry is developing an on-line management information system for the issuance of V-legal documents that will be ready for operation in late 2012. Meanwhile, the executive officer of the Papua New Guinea Forest Industries Association Bob Tate says although PNG sends a small amount of timber to Australia, the impact of the illegal logging Bill on the industry will be devastating. “We would prefer that the law not be passed,” he said. “For our smaller exporters, we expect the market to virtually dry up overnight.”
“In effect, the ‘rule book’ won’t be available for two years, if and when the law passes. That, we believe is totally impractical, and again will only add to market uncertainty over what is legal and what is not legal,” he said. Mr Tate says it’s also a question of timber traders being able to absorb the extra costs involved in proving logs are legal. The bigger companies will probably survive, but others will be forced out. “For our smaller producers, it basically comes down to can they afford to implement these very complex and very expensive schemes to prove legal compliance.” John Tanner, chief executive of the New Zealand Wood Processors Association, says even though his members support the proposed law, detail is missing. “At the moment, we have no idea to what extent we have to prove legality, and proving legality is a difficult thing,” Dr Tanner said. The biggest questions being asked about the Bill are which of 30,000 or so timber products would be covered by the law, and what verification systems will be recognised by Australia. Australian Greens Leader Senator Christine Milne says the legislation is a step in the right direction, but says her party will try to pass amendments to the legislation in the senate, including tightening the definition of illegal logging. But Senator Milne says the Greens will vote with the government to pass the legislation in the senate even if those amendments don’t succeed.
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WHAT’S ON?
OCTOBER
2-4: Future Build 2012. Melbourne Exhibition Centre. Contact Australian Exhibitions and Conferences (03) 8672 1200 or email: mail@aec.net.au
3-4: Joint ISCs and Skills Australia conference: The Future of Work In 2011, Australia’s 11 industry skills councils and Skills Australia held their inaugural joint conference. Join MC Kerry O’Brien, Q&A panel moderator Tony Jones and a range of industry identities to explore the future of work, and its implications for building Australia’s human capital. Sydney Convention and Exhibition Centre, Darling Drive, Darling Harbour, NSW.
4-6: Malaysian Timber Council’s (MTC) Global WoodMart 2012, Kuala Lumpur Convention Centre, Malaysia. For further information go to www.globalwoodmart.my. For information about complimentary hotel accommodation and other assistance, including sponsorship invitation and application forms contact John Halkett at john.halkett@bigpond. com or +61 (0)2 9356 3826. 14-17: Australian Forest Growers conference. Gympie Civic Centre, Gympie, Qld. More than 50 speakers will present at 20 sessions. Three concurrent streams will feature growing, products and markets and integration. The middle day will feature six field trips heading in all directions from Gympie to examine local growing and processing in action. This will be
followed by the presentation of the national Tree Farmer of the Year Award at the conference dinner. Visit www.afg.asn.au for further information or contact Terry Greaves on (02) 6162 9000 or email terry.greaves@afg.asn. au
30-31: ForestWorks and First Super 5th annual Industry Development Conference In 2011, Hyatt Hotel and Parliament House. Canberra. This is an important opportunity for all current and aspiring leaders of the forest, wood, paper and timber industry to engage in strategic and political debate on critical issues affecting the whole industry in Australia. This year’s conference will consider the future opportunities and challenges for manufacturing timber, wood and paper products in an advanced and multi-speed economy. The conference has been specifically scheduled to coincide with parliamentary sitting week, providing a great chance for industry players, union representatives, policy makers and MPs to gather, network and share ideas on positive future directions for the industry. Registration inquiries contact: The Events Manager at cday@forestworks.com.au or phone (03) 9321 3500.For further information, including announcements of speakers and topics, visit www.forestworks. com.au/conference2012 10-11 (Rotorua) and 16-17 (Melbourne). Improving international cost competitiveness through
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EVENTS
smart science, research and technology. New Zealand and Australian forest products companies face increasing competition from low cost producers, and from lower cost, better performing nonwood products. Low costs and high fibre recovery,achieved through process innovation, are prerequisites to competing in today’s global forest product markets. This Australasian technology event will provide local forest products, wood processing and manufacturing companies with a unique opportunity. Visit www. woodinnovationsevents.com
Australia’s forest, wood, pulp and paper products industry now has a stronger voice in dealings with government, the community and in key negotiations on the industry’s future, as two peak associations have merged to form a single national association.
NOVEMBER
3: Queensland Timber Industry Awards Night – Victoria Park Function Centre, Brisbane. 28-29: ForestTech 2012 – Improving Wood Transport and Logistics. Melbourne and Rotorua
December
4-5. Focus on improving transport and logistics in the forestry sector. It will build on the excellent program designed by the Forest Industry Engineering Association. Visit www.foresttechevents.com
APRIL 2013
Residues-to-Revenues 2013 Conference and CleanTECH Expo Wood energy and ‘cleantech’ industry developments. Crowne Plaza Hotel, Auckland, April 10-11, 2013; Bayview Eden Hotel, Melbourne, April 15-16, 2013. Event website: www. woodresiduesevents.com
The Australian Forest Products Association (AFPA) has been formed through the merger of the Australian Plantations Products and Paper Industry Council (A3P) and the National Association of Forest Industries (NAFI). AFPA was established to cover all aspects of Australia’s forest industry: - Forest growing; - Harvest and haulage; - Sawmilling and other wood processing; - Pulp and paper processing; and - Forest product exporting. For more information on the Australian Forest Products Association (AFPA) or to enquire about membership , please call (02) 6285 3833.
issue 238 | 10.09.12 | Page 5
EVENTS
Stepping up the value chain at ForestWorks annual conference
innovative – and a huge part of innovation is stimulating and cultivating collaboration.
From Page 2
He will be joined on the list of speakers by Dr Harley Dale, chief economist of the Housing Industry Association, Jim Henneberry, chief executive of Australian Paper, and Brett Himbury, chief executive of the $35 billion Industry Funds Management Group. The full line-up of speakers is available at forestworks.com. au/conference2012 ForestWorks chief executive Michael Hartman said the annual conference had built up a considerable reputation in a short span of time, but this year’s event was particularly special. “To secure a globally influential speaker like Göran Roos to open this event is a real coup,”
‘There are undoubtedly real challenges facing the forest, wood, paper and timber industries, and in fact all manufacturing in Australia, but there are real opportunities too’
Page 6 | issue 238 | 10.09.12
“There are undoubtedly real challenges facing the forest, wood, paper and timber industries, and in fact all manufacturing in Australia, but there are real opportunities too.”
Dr Harley Dale . chief economist, Housing Industry Association.
Michael Hartman .. conference addresses major issues.
Mr Hartman said. “His thinking on the future of manufacturing is respected around the globe and his insights on the future of our industry will no doubt provide much food for thought.” Mr Hartman said the current state of manufacturing in Australia made the conference
even more significant. “Times are certainly tough in our industry right now and that’s what makes this conference so vital,” he said. “We understand that it is not viable for businesses to continue on with a ‘businessas-usual’ approach. Now is a time when it is necessary to be
Mr Hartman noted the extensive line-up of speakers would be bound to generate debate, discussion and ideas.
“We have thought-leaders from Australia and around the world addressing the major issues facing our industry: the impact of illegal logging, the debate about free trade versus fair trade, the need to stimulate residential housing construction and other approaches to increase the use of timber,” he said. “I am certain conference participants will leave Canberra with higher levels of inspiration and, more importantly, new information and ideas to help forge a positive path forward for their businesses and the industry.” Full program, P 20-21.
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FOREST SYSTEMS
CO2 Australia study estimates volume of carbon stored in Tasmanian forests
CO2 Australia has released the findings of a Tasmanian forest carbon study designed to estimate the volume of carbon stored in the state’s forest estates. The study was commissioned by the Tasmanian government through the Tasmanian Climate Change Office. CO2 Australia chief executive Andrew Grant said the Tasmanian government deserved recognition for undertaking such a study. “This is the first carbon study of its kind undertaken in Australia,” Mr Grant said. “The comprehensive study provides a complete carbon accounting system that can be used for complex and large scale carbon accounting for forest systems now and in the future.” The aim of the carbon study is to develop a picture of carbon stock levels in Tasmania’s forests and covers more than 3 million ha and 95 different forest types. The carbon study looked at the complex issue of how changing forest management and land use practices affect carbon stocks, the level of carbon abatement that arises from those changes and also provided an assessment of the commercial value of the various carbon storage levels. An analysis was provided of opportunities to monetise carbon sequestration and avoided emissions under various domestic and international carbon trading programs. The study found that current carbon stocks in Tasmania’s forests contain around three to four billion tonnes of carbon, which is six times the amount of Australia’s average greenhouse gas emissions profile. Under a variety of forest management and land use scenarios it was found that it
may be possible to achieve greenhouse gas abatement worth tens of millions of dollars in the future. It was concluded that the development and growth in the carbon markets provides interesting prospects for commercial carbon forest projects in Tasmania. “We are very pleased to have had the opportunity to be involved in this study, which leverages our strengths in the carbon advisory area. We have some unique experience in forest carbon accounting and assessing the commercial
potential for forest carbon projects, all of which align very well with the objectives of this project,” Mr Grant added.
Andrew Grant .. a complete carbon accounting system.
With more than eight years’ experience in the domestic and international carbon markets, CO2 Australia is well-placed to work in this report. As a carbon specialist, the company operates across all aspects of carbon regulation in Australia (and other parts of the world), and more broadly under the mechanisms of the Kyoto Protocol.
www.tanalised.com
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issue 238 | 10.09.12 | Page 7
EVENTS
Categories and finalists chosen for Queensland timber industry awards
CATEGORIES and finalists have been selected for the Queensland Timber Industry Awards to be presented at a gala function at the Brisbane’s Victoria Park convention centre on Saturday evening, November 3. “This prestigious industry event will showcase and recognise our industry’s finest,” said Alicia Oelkers, state manager of TABMA Queensland which is hosting the awards. “This is the only event of its kind for the Queensland timber
Prestgious venue .. Victoria Park convention centre.
industry and it is our chance to recognise those who excel in their chosen field.” Sponsors include Mitre 10 Trade (gold), Imperial Profilers (silver) and Hyne, Ozline Timbers, Lindsay Meyers and Brisbane Hoo-Hoo Timber Industry Club 218 (bronze). Invitations are being finalised, however you can get in early and book your table or seat. Tickets are $143 each or $1325 for a table of 10 (gst inclusive). Contact Alicia on (07) 3254 3166 or email alicia@tabma. com.au Tickets include a three-course meal, five-hour beverage package and live entertainment. Accommodation has been arranged at the Hotel Urban, 345 Wickham Terrace, Brisbane, and guests can book by contacting (07) 3831 6177 and quoting Victoria Park. Nightly rate is $160 a room and a courtesy bus transport guests to Victoria Park. Categories and finalists: Best Specialist Timber Merchant – Tradeware Building Supplies; 5 Star Timbers; Lindsay Meyers. Best Building Materials Centre (metro) – Tradeware Building Supplies; Star Timbers; Versace Timbers; Trade Builders Supplies; Virginia Building Supplies; The Fastener Place; Chermside Building Centre; Wayne Norman Timbers. Best Building Materials Centre (regional) – Toowoomba Timbermart; Roma Home Improvement; Bootle Timber Townsville; Porters; Big Hammer Building Centre; Sids Place Toowoomba; MacKenzies Home Timber & Hardware. Best Timber Wholesale Operation – Simmonds Lumber; Pacific Wood Products; Woodhouse Timbers;
Cont Page 11
Page 8 | issue 238 | 10.09.12
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INDUSTRY NEWS
Manufacturing report a good start but govt must confront issues
THE Australian Forest Products Association has welcomed the findings and reform agenda of the Prime Minister’s Manufacturing Taskforce report, but does not underestimate the challenges involved for improving the regulatory environment of doing business in Australia. Chief executive Dr David Pollard said a lot of work had gone into the report and the wood and paper products industry supported the commitment by government to lift productivity growth, innovation and skills development. “These factors, along with the high dollar, are holding back manufacturing competitiveness,” Dr Pollard said. ‘We are also encouraged by moves to look more closely at corporate taxation rates, national energy market reform to deliver lower prices to energy users, ameliorating the impacts of the carbon price for energy-intensive businesses in the current environment and stronger anti-dumping measures.” Dr Pollard said these factors would go a long way to addressing some of the key issues impacting now on the wood and paper products industry. The industry, which makes such products as office copy paper, tissues, paper for the print media and timber building products, is a large manufacturer in Australia. The industry represents nearly 7% of manufacturing value added and contributes to the
David Pollard .. call for strong national leadership.
social fabric of many regional communities.
“While recognising the manufacturing taskforce report is a good start, we repeat calls from industry for strong national leadership and a bold approach to addressing some of the fundamental issues confronting the manufacturing sector,” Dr Pollard said.
dennis@industrye-news.com
Many similar recommendations were made as part of the Pulp and Paper Industry Strategy Group (PPISG) report released in 2010. This group, which involved industry, researchers and unions with support from key government agencies, highlighted a strategy for removing policy impediments and promoting growth opportunities for pulp and paper manufacturing. AFPA looks forward to working collaboratively with the federal government on its response to the pulp and paper industry report, which is expected shortly.
editorial inquiries
tel:
+61 3266 1429
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issue 238 | 10.09.12 | Page 9
INDUSTRY NEWS
AFPA: Illegal logging Bill must target suspect timber imports
THE Australian Forest Products Association supports the Illegal Logging Prohibition Bill 2012 currently before the senate emphasising there is a need to support international efforts to curb trade in illegally sourced wood and paper products. Chief executive Dr David Pollard said iIllegal logging activities in overseas countries not only contributed to forest
AFPA is concerned that (the Bill) may impose unnecessary red tape and compliance costs on Australian producers
InSurAnce.. It’S All In the SelectIon
degradation, they undermined the competitiveness of legitimate and sustainably sourced wood and paper products in Australia. “By not adhering to legality requirements, illegally sourced imports can be obtained cheaply,” Dr Pollard said. “They also undercut legitimate producers both in Australia and on the world market.” While supporting the intent of the Bill, AFPA is concerned that it may impose unnecessary red tape and compliance costs on Australian producers, who already operate within a stringent legal and compliance framework for sustainable forest management. “In addition, Australian
Government crack-down on timber illegally sourced from unsustainable forests.
manufacturers of wood, tissue and paper products have a
high uptake of independent and internationally recognised certification schemes that are able to verify the source of their products’, Dr Pollard said. “The focus of the Bill should rightly be on suspect imports, and not impose additional red tape on the domestic industry. Reporting and compliance requirements for low risk Australian producers should be streamlined and not raise costs by duplicating existing legal processes. “AFPA calls on the senate to recognise the legal nature of Australian forestry operations and not to expose domestic producers to unnecessary regulation and risk in the shared desire to curb illegal imports.”
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• Modern Veneer • Characteristic Structural Properties of Plywood • Plywood Adhesives • Veneer Grading • Veneer Peeling • Simplified Basic Mechanics • Basic Wood Science • Preservative Treatments • Veneer Drying Fundamentals • Quality Control & Product
Certification • Troubleshooting for Causes of Faulty • Formaldehyde Emissions • Glue Mixing • Overlaid Plywood • Bonding LVL with Phenolic Adhesives • Structural Characteristics of Veneers
For further information please contact EWPAA on +61 7 3250 3700 or email sonia.moore@ewp.asn.au Insuring it all stacks up.
www.ewp.asn.au Page 10 | issue 238 | 10.09.12
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ENGINEERED WOOD
Canadian sawmilling industry ramping up annual production
From Page 3
second half of this year and into 2013 as the housing and remodelling markets slowly improve. The American and Canadian sawmilling sectors are currently running at about 80% of practical capacity according to the Western Woods Product Association so there is room to add hours and shifts to meet increasing lumber demand. However, it is going to be a bumpy road ahead as the sawmilling sector’s infrastructure industry has downsized the past three years. The Canadian sawmilling industry has ramped up production the first six months of 2012 as compared to the same period in 2011. All provinces with the exception
of Ontario have produced more lumber this year than last year.
The provinces of Alberta and Quebec have seen the biggest increases thanks to higher demand for lumber in the US housing sector. West coast sawmills have also been shipping more lumber to China this year, with exports during the first half of 2012 up 3% percent as compared to the same period last year.
The improved markets for lumber have put upward pressure on lumber prices. During the past 12 months, southern yellow pine prices have gone up almost 37%, while spruce pine fir prices in Canada have increased by about 35%.
Timber industry awards
From Page 8
ITI; Tilling; Gunnersen. Best Specialist Service Operation – 5 Star Timbers; Pacific Wood Products; Lindsay Meyers; Timbeck Cedar Products. Best Frame and Truss Operation (metro): Noosa Truss; Custom Truss & Frame; Chermside Building Centre; Virginia Timbers & Trusses; Northside Trusses & Frames; Langs Building Supplies. Best Frame and Truss Operation (regional) – Howard & Sons; Emerald Truss & Wall Fabrication; Bundaberg Frame & Trusses; Cleveland Trade Centre Townsville; Porters; Toowoomba Truss & Frame. Best Timber Manufacturing Operation – Hyne Timber – Engineered Timber Products; Panelbuild; Timbeck Cedar Products. Best Sawmilling Operation – Roberston Bros Sawmill; Dale & Meyers; Parkside Group.
Best Training Organisation – Pacific Wood Products; Versace Timbers; Ravenshoe Timbers; Parkside Group; Hyne & Son Tuan. Trainee/Apprentice of the Year – Nathan Prasad (Dindas); Joseph Hardefeldt (Carter Hold Harvey Caboolture mill); Tim Facoory (Versace Timbers); Reginald Roache (Northside Trusses and Frames). Best Wholesale Sales Rep – Peter Bailey (Plywood Services), Jason Justice (Pacific Wood Products); Debbie Payne (Tilling Timber), Danny Meredith (Lindsay Meyers), Pat Cannon (Tasman KB), Terry King (Gunnersen), Mal Conduit (Parkside). Recognising Women in the Forestry and Timber Industry – Nicole Morris (Roberston Bros Sawmill), Casey Holmes (5 Star Timbers), Debbie Payne (Tilling Timber), Sue Landesmann (VSH Timbers), Mia Cassidy (HQ Plantations), Bronwyn Morris (FITEC), Kathy Jeffrey (Lindsay Meyers).
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issue 238 | 10.09.12 | Page 11
INDUSTRY NEWS
Ships high emitters of unchecked nitrogen oxide at Australian ports
SHIP engine exhaust emissions make up more than a quarter of nitrogen oxide emissions generated in the Australian region, according to a recentlypublished study by CSIRO and the Australian Maritime College in Launceston. Nitrogen oxide is a nongreenhouse gas, unlike similarly named nitrous oxide. The remainder comes from road and air transport, energy generation, and industrial processes. Global studies indicate that shipping emissions of nitrogen oxide and sulphur contribute to the formation of photochemical smog and particles near land and in ports. The authors, Dr Ian Galbally from CSIRO Marine and Atmospheric Research, and the Australian Maritime College’s Dr Laurie Goldsworthy, estimate that about 30% of anthropogenic nitrogen oxide emissions and 20% of oxides of sulphur emissions generated in the Australian region may come from shipping. These are non-greenhouse gases which have the potential to affect the air quality near coastal regions, and have consequences for human health and amenity.
MV Goliath .. test vessel for measuring ship exhaust emissions.
Dr Galbally said around 10% of global shipping freight passed through Australian ports annually. “Shipping is a major driver in the Australian economy, with 753 Mt of international exports worth $202 billion passing through Australian ports in 2008-2009,” Dr Galbally said. “There is limited knowledge about the emissions from ships in coastal regions and ports in Australia, the effects of these emissions on air quality in the surrounding coastal and portside urban regions, or potential effects on human health.” The ports of Perth, Melbourne,
Dr Ian Galbally .. limited knowledge about ship emissions in coastal regions of Australia.
Sydney located
and Brisbane are where seasonally-
prevailing onshore winds dominate and the pollutants from shipping frequently will be carried into the air-sheds of these major urban population centres. “We’re seeing increasing regulation of land-based emissions but limited regulation of shipping emissions and expect that in the near-future there will be a need to monitor more closely emissions from shipping,” Dr Galbally said. The authors commenced this study with measurements of ship exhaust emissions on the coastal cement carrier MV Goliath. Dr Goldsworthy said it was possible to quantify emissions generated based on knowledge of fuel type, fuel origin, engine size, cargo, and speed. “We know from previous studies and the Australian Pollutant Inventory that ship emissions off the coast of Australia are substantially larger than in-port ship emissions,” he said. “Nitrogen oxide and sulphur oxide emissions at sea are comparable in magnitude with other national sources such as energy generation and industry. They are potentially significant contributors to the air-sheds of major coastal cities.”
Opportunity: new engineered product Project seeks access to on-going timber resource
ThIs engineered product is manufactured from small diameter treated true round plantation logs that would normally be chipped or destroyed. Resource cost is minimal. The production system is low capital cost and can be set up in a minimum of time and at a minimum of cost. Compared with current systems such as LVL, sawn timber etc. this product has unrivalled versatility, fire resistance, projected longevity and sustainability. This product has the ability to lower the costs of floor and wall framing in modern homes, as well as being ideal for low-cost housing The entire buildings can be erected on site using unskilled labour. The product has undergone comprehensive testing at the engineering faculty of the University of Technology Sydney under the guidance of internationally renowned timber engineer Prof. Keith Crews.
Engineered Timber Products
Loggo products have undergone comprehensive testing at the engineering faculty of the university of Technology sydney.
Page 12 | issue 238 | 10.09.12
The project is keen to establish a plant near a guaranteed resource. Contact: (02) 4256 4767 or email pat@loggo.com.au www.loggo.com.au
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WORLD TRENDS
Global sawlog prices continue slide as demand withers in most regions Western US, BC exceptions as Asia beckons
SOFTWOOD sawlog prices continued their slide throughout the world in the second quarter of this year, according to the Wood Resource Quarterly. The global sawlog price index (GSPI) was down for the fourth consecutive quarter to $82.90 / cub m, the report said. The Index was down 3.4 % from the first quarter and 11.5 % from the second quarter of last year. Log prices were down in practically all major regions worldwide, both in the local currencies and in US dollar terms. Western US and British Columbia were the only exceptions thanks to strong exports of lumber to Asia and higher demand for lumber in the US. [Trade figures show the value of BC softwood lumber exported to China has surpassed the US for the first time, sending powerful signals about the importance of the Asia-Pacific markets for the Canadian province’s economy and job prospects]. In the second quarter of 2012, prices for wood chips and pulp logs fell in practically all regions tracked by the WRQ. Uncertainty in pulp markets, lower pulp and paper prices and a healthy supply of sawmill chips were all factors that put downward pressure on wood fibre prices. The softwood wood fibre price
Rising sales .. British Columbia’s softwood lumber exports to China have surpassed exports to the US for the first time.
index (SFPI) fell 4.1% in the second quarter this year to $100.54 / odmt. The biggest price declines occurred in Brazil, the US northwest, Australia and eastern Canada. The WRQ says hardwood fibre prices have fallen even more than softwood fibre prices this year. The hardwood wood fibre price Index (HFPI) was $104.88 / odmt in the second quarter 2012, down 4.4% from the previous quarter. The HFPI has now fallen for three consecutive quarters since the all-time high in the 2011 third quarter. Global demand for market pulp has continued to whither during the second quarter of this year, particularly in Europe and North America.
Softwood market pulp (NBSK) prices have fallen dramatically from a year ago. NBSK prices in Europe were around $790 / tonne in July, down from $1040 / tonne in the second quarter last year. The price fall for hardwood pulp (BHKP) has not been as steep as for NBSK, with the current $770/ton price in Europe down from $880/ton in July 2011. In May, lumber consumption in the US was 13% higher than in May 2011 and was the highest seen in the month of May since 2008. The Canadian sawmilling industry ramped up production the first five months of 2012 as compared to the same period in 2011.
Pine lumber prices in the US south have gone up almost 35% this year, while spruce pine-fir (SPF) prices in Canada have increased by about 30%. Sawmills in Finland and Sweden increased exports year-over-year and by almost 10% in the first five months of 2012. Export prices in the second quarter were below the average for the past three years. China’s importation of softwood lumber increased in the second quarter, up 27% from JanuaryMarch, but only less than 1% more than the second quarter last year. During the 2012 second quarter, lumber prices in Japan for both domestic and imported softwoods trended upward but were still generally lower this year than in 2011. In the 2Q/12, Woody biomass prices were down between 2-10% in the key biomass consuming region of the US in the 2012 second quarter compared to January-March this year. North American shipments of pellets to Europe continue to steadily increase, reaching a new high in the first quarter this year. Pellet prices in Europe experienced a typical decline during the summer months.
Drought, then it rains beetles in British Columbia
THE combination of highgrade logging for spruce and fir and drought conditions has increased British Columbia’s lodgepole pine population from 17% to 53% of the provincial forest in the last few decades. And that’s attracted swarms of
mountain pine bark beetles so large they get mistaken for rain clouds on airport radars. The combined weight of beetles in the infestation over Homer, Alaska, equaled 3300 killer whales, or half a million wolves flying over the forest.
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Mountain pine bark beetles are part of some 7000 beetle species that live in coniferous forests, although only 10 or so are the tree-killing variety. The beetles attack pine trees, burrowing inside to lay eggs. Those larvae give off a fungus
that turns the wood blue. The tree dies in the process. The fungus releases nitrogen from the core of the tree in huge amounts, which the beetles feed on. In essence, they farm their fungus inside the tree.
issue 238 | 10.09.12 | Page 13
NEXT NEXT NEXT BIG BIG BIG STEP STEP STEP
NEW NEW ADVANTAGES ADVANTAGES NEW ADVANTAGES WITH WITH KOMATSU WITH KOMATSU KOMATSU
Komatsu 'FoREst XtREmE' FELLER BuNCHERs & HaRVEstERs Introducing Introducing
Komatsu Komatsu
Komatsu Forest offers the PC300LC-8 and PC400LC-8 as purpose built forest machines (FX) with specifications to match the toughest jobs. Forest Xtreme features: • ROPS/FOPS/OPS Cabin • Full heavy duty Gull Wing canopy • Heavy duty under body guarding
• Harvest or Feller Buncher boom sets • Single or double bar track grousers • Integrated 1200 litre fuel tank • Engine option; 260hp or 362hp
The Forest Xtreme machines illustrates Komatsu forest’s dedication to provide the best solution for the logging contractor.
Page 14 | issue 238 | 10.09.12
www.komatsuforest.com.au www.komatsuforest.com.au www.komatsuforest.com.au
Introducing
Komatsu
Komatsu Forest Pty Ltd 15C Hyland Cres Rotorua, New Zealand Komatsu Forest Pty Ltd. Dean O’Connor M: +64 of 277 718 254 11/4 Avenue Americas E: dean.oconnor@komatsuforest.com Newington NSW 2127 Australia John Kosar M: +64 2274 8653600 844 T: +61 9647 E: john.kosar@komatsuforest.com E: info.au@komatsuforest.com
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FORESTRY AND FOREST MACHINERY
Camera removes blind spot around heavy machinery BLIND spots around heavy equipment can result in damage to equipment and injury – or even loss of life. RMT has developed TrackVision, a safety camera designed to eliminate the blind spots surrounding heavy equipment. Blind spots most commonly occur at the front or rear of the vehicle, although certain equipment types also have blind spots to the side. All camera adjustments are made directly from the monitor, and the camera can be set to turn on when the machine reverses and turn off when the machine drives forward, or it can remain on while the machine is operating. The camera casing is nitrogen filled and watertight. It has a heated lens surface to prevent condensation or frost and a 115% wide-angle view. The
camera is also very accurate in low-light, and can ‘see’ better than a human eye in these conditions. The monitor is shockproof and vibration resistant, has an integrated sun cover and the monitor brightness automatically adjusts to the amount of daylight. The standard installation includes one heavy-duty camera mounted at the back of the vehicle and an 18 cm colour flat screen LCD installed in the cab.
Additional cameras can be installed around the vehicle. The camera can also be used for precision work. When an excavator operator has limited visibility, the camera can be mounted on the dipper stick.
We’re right behind you in the field Combining remote locations, harsh operating environments and heavy vehicles and equipment, the forestry and timber industries face significant fire risks. With Wormald, you have an organisation that is always right behind you when you need us most. We’ve helped prevent and protect against fires for over 120 years. Wormald has the fire protection solutions for heavy vehicles that range from fire detection and suppression systems, to portable fire equipment, personal protection gear and staff training; our end-to-end tailored solutions help protect major forestry operations throughout Australia and the Pacific region. So, you can get on with the job, confident that your people, resources and machinery are supported by one of the world’s fire safety leaders. That’s peace of mind. Trust the forestry fire safety experts. In Australia: Call 1300 556 015. email wormald.ads@tycoint.com or visit wormald.com.au/vehicles In New Zealand: Call 0800 496 762, email wormaldnz.ads@tycoint. com or visit wormald.co.nz/vehicles
Track-Vision .. a safety camera that eliminates blind spots.
Pictured: Cylinders and Extinguishers
Quantifying clearfell volume losses RESEARCH results quantifying volume losses during the felling and conversion of pine clearfell operations also determined the utilisable timber left behind. The research is set out in
‘Fibre volume losses of eight softwood clearfell harvesting systems in South Africa’, published in Southern Forests (Journal of Forest Science, 2012, 74(2), pp 133 to 149).
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issue 238 | 10.09.12 | Page 15
FORESTRY AND FOREST MACHINERY
There’s strength in numbers – but can we count on you? Contractor associations play essential role
YOU know the story about there’s strength in numbers? It’s certainly true when it comes to influencing the public policy debate and getting into the ears of politicians. Let’s be honest – the forest industry just hasn’t been all that good at playing the strength-in-numbers game. So, not surprisingly, we have been outnumbered and out-gunned by anti-forestry interests and subsequently politicians who want to do us harm. You don’t have to look much further than Tasmania to see that. On the harvest and haul contractors’ front, in my humble opinion, we haven’t helped our own cause. And this despite the reality that our national industry body – the Australian Forest Contractors Association (AFCA) – has worked hard to get a seat around important policy and decision-making tables such as the Forest and Wood Products Council chaired by the minister Senator Joe Ludwig. It is at meeting of this council that members, including the manager of the AFCA David Drane, get to eyeball the minister and debate issues of critical importance to contractors, such as the Tasmanian contractors exit assistance package for example. Disappointingly, many contractors are not members of AFCA or in Tassie the Tasmania Forest Contractors Association (TFCA). Not being a member of such industry bodies means that the strength-in-numbers principle falls short and associations have fewer resources and authority to prosecute the case
Page 16 | issue 238 | 10.09.12
Fighting for the cause ..if you are not a member of either the AFCA or of the TFCA you should get serious about the industry and join.
for contactors. Think about it for a moment – all contractors pay their machinery insurance, workers compensation, tax and other changes related to their dayto-day work activities, but arguably the greatest risk to staying in business – continuing access to trees – is efficiently unfunded, left on a wing-anda-prayer and at the mercy of politicians. The AFCA was established in 2002 to look after the interests of harvesting and haulage contractors because at the time it was felt that there was a need to establish a national body to be an advocate for the
The ACFA has been remarkably effective in establishing a business network for contractors; already in its relatively short history it has achieved a number of significant milestones
Deep in the Woods with ..
Cheryle Forrester long-term commercial viability and welfare of forest contacting companies. As the AFCA website says: “The strength of what we have been able to do is to create a national network of people in the same game with the same
issues. While the style, and machine mix of harvest and haul differs greatly, the crux of why we do what we do and the ideology of how we harvest and haul is very similar.” The ACFA has been remarkably effective in establishing a business network for contractors; already in its relatively short history it has achieved a number of significant milestones, including obtaining and maintaining positions on a number of federal government committees and councils and other bodies set up to manage the industry. Such membership and influence has enabled the AFCA to have regular constructive input into the future policy and direction of many of the country’s major timber industry activities and initiatives. In similar vein, for those of you on the southern-side of Bass Strait, the TFCA is dedicated to representing the interests of Tasmania’s diverse network of forest contractors. The association is involved at all levels of industry and government ensuring that the collective voice of the harvest, haulage, silviculture, site preparation, roading and quarry contractors is taken into account when critical decisions affecting the business interests and lives of forest contractors and their families are being made. In addition, the TFCA offers member companies business support services such as industrial relations advice, training, safety management systems implementation, benchmarking, rate calculations and other services.
Cont Page 17
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FORESTRY AND FOREST MACHINERY
New Komatsu log harvesting head leads for productivity and reliability
KOMATSU continues to lead the log harvesting sector in innovation and development and machinery with a strong focus on productivity, reliability and cost effectiveness. In another example, Komatsu has introduced the 398 harvesting head into the Australian forestry market. This new harvesting head is designed to handle a large variety of plantation and forest situations, from first thinnings to clearfelling, and can work both as a harvesting head or a processor for pre-felled trees. With its carefully evaluated design, based on tried-andtested components and a structurally strong chassis, the Komatsu 398 harvesting head can cope with a wide range of demanding, high throughput applications. Suitable carriers for the Komatsu 398 harvesting head include excavators in the 27-tonne class and upward, or a purpose-built forest machine, such as the Komatsu XT450L. Low maintenance costs
four hydraulic motors, with a geometric placement and
movement pattern that enables them to not only feed trees
through the head but also to
lift them. The result is a secure grip and superb measurement
performance. The feed rollers
are controlled by two cylinders with an equaliser bar.
The standard Komatsu 398 harvesting
head
has
delimbing knives. Komatsu .. continuing to lead the log harvesting sector in innovation and development.
and minimal down-time have been key objectives in the development of this new harvesting head. The well thought-out chassis construction and the fully protected hose routing through the rotator are prime examples of incorporating these objectives into the design. Another example of innovative design and manufacture is that
the head is fitted with softsealed hydraulic couplings in which O-rings comprise the seals rather than metal-tometal interfaces. This is good for production as the head’s reliability is increased. It is also good for the environment as leaks are minimised. Log or tree stem feed through the head which uses three feed rollers powered by
three
Optionally,
two additional delimbing knives
can be mounted in the rear
section of the head. An optional top saw is also available.
The standard head is equipped
with EcoOiler, an innovative system that provides effective
control over the amount of lubricant fed to the chain and bar. The Komatsu 398 is designed for use with the MaxiXplorer system.
Head
control
Jill Lewis leaves ATA NSW, new manager appointed
JODIE BROADBENT, who has been the senior policy adviser at the Australian Trucking Association since February, is the new manager of ATA NSW. She replaces Jill Lewis who has accepted a position outside the trucking industry. Ms Lewis joined ATA from the former National Association of Forest Industries.
During her four and a half years in the role, Ms Lewis forged close relationships with the Roads and Maritime Services and the O’Farrell government, as well as other key stakeholders. “Jill has done a spectacular job getting the organisation to where it is now from its fledgling beginnings,” ATA
NSW chairman Jon Luff said. “Under Jodie’s guidance, ATA NSW will continue to advance. She grew up with diesel in her veins, and her long experience with the industry will make her a tremendous asset to the team.” Mrs Broadbent said she was keen to meet ATA NSW members and work with the
policy
involved
council with
and
the
those
port
to
achieve the best outcomes for members.
“Our industry is often portrayed
in a negative light, and I’m
determined to change the way
our members are perceived by the general public.”
Collective voice of forest operations must be heard
From Page 16
What I am trying to get across to you is the valuable, essential role harvest and haul contractor associations play in endeavouring to keep
contactors in business. They haven’t and won’t win every fight, but they are on your side and that is more than you can say for a whole range of other interest groups. So my message to you is that
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associations play a valuable and hard-won role and deserve your support. If you are not a member of either the AFCA or of the TFCA you need to help the cause and yourself and join – you know it
makes sense!
As always, I welcome your thoughts at timber&forestryenews@ bigpond.com Catch you next time.
issue 238 | 10.09.12 | Page 17
OPINION
Tough times in Tassie The industry is experiencing its worst downturn in a decade, prompting much-needed restructuring
THESE are tough times for the Tasmanian forest industry. Almost everywhere one confronts a sea of red ink, failed investments, lost contracts and redundancies. The losses do not discriminate; the private and public sectors are affected as are large and small companies and cities and rural areas. The larger the company the greater the impact, for good and bad. Given this equation, large companies need to be held to much tougher accountability, transparency and sustainability requirements than they currently are. The once-mighty Gunns Ltd’s recent end-of-year accounts illustrate the problem. At the end of August, the company announced a $904 million loss for 2011-12. This followed a loss of $356 million the year before. The red ink has forced the company to announce that its much-vaunted Bell Bay pulp mill is no longer “probable to proceed”. They’ve expensed the $255 million spent to date instead of treating it as an investment. Gunns is not the only company doing it tough. Forestry Tasmania, a government business enterprise (GBE), is also in trouble. Designed to pay a divided to the state, the company has incurred two years of losses following several years of anaemic returns. Its poor performance has been independently reviewed
Tasmanian forests .. and industry in crisis.
by URS Forestry, which recommends that the GBE be downsized and restructured to more narrowly focus on commercial operations. URS predicts that Forestry Tasmania – either in its current or restructured form – will continue to incur losses of around $25 million a year for the next five years. Given the scale of the crisis, a small industry has emerged to explain it. Simplistic monocausal accounts abound. Business pundits predictably sheet blame home to “greenies” and the market campaigns conducted in Japan and elsewhere against Gunns, Ta Ann and Forestry Tasmania. More thoughtful analysts recognise that market campaigns, while effective, are not the sole reason. Structural factors are at work. These include a historically high
There is an instructive ecological political economic lesson about corporate size and scale that needs to be teased out and understood if the state is to avoid lurching from one unsustainable industry structure to another Page 18 | issue 238 | 10.09.12
Tasmania’s forest industry is experiencing its worst downturn in a decade, prompting a much-needed restructuring. While analysts focus on factors like exchange rates, the key lesson really has to do with corporate scale, says DR FRED GALE, senior lecturer, school of government, at the University of Tasmania, in these extracts from his ciritical report on the state’s forest industry. Dr Gale is a member of FSC International and FSC Australia. Australian dollar; a decline in per capita paper demand thanks to computerised
workplaces; the superiority of plantation over native hardwood woodchips coupled with a significant increase in plantation woodchip volumes; and the growth of third-party, Forest Stewardship Council, certification. Environmental campaigns against forestry have been effective, but aren’t the only cause of the crisis. There can be much debate over the relative importance of these factors. But they have collectively placed a greater load on Tasmania’s forestry model than it can bear. There is an instructive ecological political economic lesson about corporate size and scale that needs to be teased out and understood if the state is to avoid lurching from one unsustainable industry structure to another. The issue of corporate scale and impact has recently reappeared on the global agenda. Appalled by the ramifications of the collapse of Lehman Brothers that signalled the existence of a global financial crisis, governments suddenly recognise that some businesses were “too big to fail”. News Corporation’s phonehacking scandal in the UK has highlighted the power of big media and its no-holds barred ethics. Closer to home, many Australians are concerned that mining companies are too big to be responsible. The machinations of mining magnates Gina Rinehart and Clive Palmer have been the subject of much recent public comment.
Cont Page 19
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OPINION
Forest sector a lesson in what can go wrong when companies grows too big
Triabunna, Bell Bay, and Burnie. As these companies grew their operations, they took on more debt and employed more workers to meet demand. When the global financial crisis struck, these interdependencies operated in reverse. Japanese importers, facing a glut of certified plantation fibre, a declining demand for paper, and pressure from environmentalists, confronted an easy choice. By purchasing FSC-certified plantation-based woodchips at little extra cost they could enhance productive efficiency, meet their corporate social responsibility goals, and get the pesky environmentalists off their backs. Gunns, trapped in a failed business model, decided its
own salvation lay in becoming a plantation-based producer of pulp. However, it bungled the effort to obtain planning permission by sidelining the Resource Planning and Development Commission’s environmental assessment of the Bell Bay pulp mill. Instead, it sought and obtained special treatment from government in the shape of a Pulp Mill Assessment Act. With no social license to build and operate the mill, its efforts to secure a joint-venture partner became increasingly desperate. The project’s practical demise occurred when its new-found financial angel, the Richard Chandler Corporation, suddenly announced in March this year it was withdrawing its support.
Gunns is now a zombie company. It lurches from one dire financial announcement to another, leaving a trail of red ink in its wake. It is currently being kept alive by the banks, notably ANZ, which is seeking to recoup as much of the outstanding $526 million debt as possible. The ASX is also doing its bit by liberally interpreting its suspension rules to provide the needed time to “restructure”. If we look back at economic history, we see numerous instances of large monopolies being broken up before they got into trouble because they were deemed to be not in the public interest. From an ecological political economy perspective, large businesses are a key public policy issue. Put simply, corporate size matters. The larger the corporation, the more significant its economic, social, environmental and political effects. While these can be positive, there is no reason to believe they necessarily are or will be. Thus, the larger the corporation, the more transparent, accountable, regulated and sustainable its operations need to be. This is the hard lesson taught by the Tasmanian forestry debacle.
the current woodchip market,” Gunns said in a statement. “The woodchip market is relevant to the operating performance and value of several business units of the company and, therefore, to the capital raising initiatives the company is currently pursuing.” Gunns said it would provide more details once the analysis was complete.
In relation to the proposed capital raising, Gunns said it was continuing talks with various potential investors. “The process remains confidential and requires further diligence and negotiation with the potential investors and Gunns lenders, before any further details can be provided to the market,” Gunns said. Gunns is seeking to raise about
$400 million to cut debt and support the development of the controversial $2.5 billion pulp mill at Bell Bay. Gunns shares were placed in a trading halt on March 9 after the Singapore-based Richard Chandler Corporation decided against investing $150 million in Gunns, which would have been part of a proposed $280 million capital raising by Gunns.
From Page 18
To these concerns can be added protests over Seafish Tasmania’s decision to bring a giant super trawler, the FK Margiris, from Europe to fish Australian waters. And then there are the pressures confronting farmers from Australia’s supermarket duopoly. In short, corporate scale and size matter: the larger the scale, the greater the power and impact – for good and bad. Tasmania’s forestry sector offers a salutary lesson in what can go wrong when a company grows too large. Through the 1990s and into the 2000s, Gunns Ltd expanded its operations with a series of strategic acquisitions. They bought Boral’s forest operations (2000), North Forest Products (2001), Auspine (2007) and ITC Timber (2009). Much of the later acquisition was debt-financed. In the 1990s and 2000s, logging was going gangbusters. Gunns’ growth enabled Forestry Tasmania to expand. More logging plans, more logging roads, and more logging ensued. With Gunns and FT going gangbusters, contracts were signed with logging contractors to harvest and transport pulpwood for chipping at
Hard lessons for forest sector in Tasmania.
Gunns reviews value of its forestry assets
GUNNS Ltd says it is reviewing the value of its forestry assets in the light of declining prices in the woodchip market. The review included the Tasmanian forest estate, which comprises 200,000 ha of hardwood plantations. “As part of the asset value analysis, the company has been analysing the impact of the recent substantial decline in stumpage prices achieved in
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issue 238 | 10.09.12 | Page 19
EVENTS
ForestWorks conference Monday, October 30
Noon: Lunch in the Gallery 1 pm: Conference Opening by MC Emily Rice, Network Ten National Reporter. 1.15 pm: Opening Address The Future of Manufacturing: Where to for Wood? Professor Goran Roos discusses ‘Through the looking glass - the future for Australian wood’. This session is intended as a genuinely uplifting opening that describes the potential for an industry future, but one that involves some hard decisions and potentially difficult changes that must be addressed with implications for businesses, communities and individuals that require a socially responsible approach. 1.45 pm: Presentation – Sustainable Investment: Why Investing in Forests is the Future. Despite a global credit crunch, investments in Australian wood assets have come fast and furious in the last few years. Wood is the renewable resource, the most sustainable building product and a major part of Australia’s regional communities and their economic futures. As the head of one of Australia’s largest plantation owner, New Forests Pty Ltd’s founder and managing director Dr David Brand is uniquely placed to describe how investments in wood meet long term sustainability needs. 2.15 pm: Panel discussion – ‘Competing in the Asian Century: Strategies for Success’. This panel discussion will address future demand for products and consider whether Australia’s forestry, plantation, wood and timber industries are ready to deliver. What has to be done by businesses, industry stakeholders and government for Australia to use its natural advantages to play a significant role in the fastest growing region in history? Panelists with real experience include Tony Price, CEO of Australian Bluegum Plantations, Simon Dorries, CEO, Engineered Wood Products Association of Australasia, and Ron Scott, president of the Furniture Industry Association of Australia. 3 pm: Afternoon tea in the Gallery 3.30 pm: Keynote presentation – Investing in Australia: ‘Why North America is Buying our Forests’. Lifting the lid on the North American expansion into Australian forestry and wood assets, Joseph F. Bachman, the director of Portfolio Management and Partner of Global Forest Partners (GFP) will speak on the value that North Americans see in our forests. Mr Bachman heads the global portfolio management team and has responsibilities for the firm’s private equity timber funds. This session will be chaired by Graeme Russell, the CEO of our industry’s superannuation fund, First Super. 4.15 pm: Panel discussion – Australian Stories: ‘New Thinking Delivering Added Value Focused on Investment Decision Making’. This session will capture the key drivers of leading Australian companies as they consider investments in wood processing. What is the right mix of sustainability, products, markets and innovation capacity
Page 20 | issue 238 | 10.09.12
that results in investment? Jim Henneberry, CEO of Australian Paper, presents a case study from Australia’s only communications paper manufacturer. Mr Henneberry will be joined by Brett Himbury, the CEO of Industry Funds Management (IFM), Australia’s largest renewable energy investor and Nathan Fabian, the CEO of the Investor Group on Climate Change to discuss what it takes to get Australian investment into wood, timber and paper.
6.30 pm: Industry Liaison Dinner, Great Hall, Parliament House, Canberra. Join industry leaders and a wide range of senators and MPs to discuss our industry’s issues and future.Simon Crean, Minister for Regional Australia, Regional Development and Local Government is an invited special guest speaker. (Concludes at 11 pm).
Tuesday, October 31: 8 am: Breakfast in the Federation Ballroom. 8.05 am: Government and Opposition addresses, followed by Q&A sessions. Chaired by ForestWorks’ chairperson Jane Calver. Speakers include Senator Richard Colbeck, Shadow Parliamentary Secretary for Innovation, Industry and Science. (A government representative will be advised shortly). 9.05 am: Industry Policy – Perspectives on an Innovative Future. Short sharp responses to parliamentary speakers from the industry’s political and strategic leadership – Dr David Pollard, CEO, Australian Forest Products Association and Michael O’Connor, national secretary of the Construction, Forestry, Mining and Energy Union. 9.45 am: Morning tea in the Gallery 10.15 am: Breakout 1 – Centenary 1 – Making it in Australia: Moving Beyond Survival. Showcasing the best of Australian-made wood products and technologies, this session will discuss what it takes to make a full range of wood products in Australia, for the domestic and international markets. Focus will be on Australian made wooden building products, furniture and paper products, the challenges that each sector faces and the different but complimentary activities they have taken to gain and maintain their place as an Australian manufactured success story. Discussion will be opened up and chaired by Bob Pearce, CEO, Forest Industries Federation of Western Australia, and will include Ron Scott, president of the Furniture Industry Association of Australia, Julian Mathers, general banager, supply chain, Australian Paper, and Rohan Wright, CEO, Australian Furniture Association. 10.15 am: Breakout 2 – The Assembly – Increasing Demand for Australian Timber Products in the Australian Built Environment. Despite its credentials, timber building products from sustainably managed forests and plantations are struggling to maintain, let alone increase their market share of Australia’s domestic and commercial construction. But there
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EVENTS
Canberra: a full progam are also some bright spots, including Australia’s growing population and need to expand our stock of housing over the coming decades. Dr Harley Dale, the HIA’s chief economist, Lisa Marty, CEO of the Victorian Association of Forest Industries, and Jim Adams, CEO of Timber Communities Australia, will join Kersten Gentle, CEO of the Frame and Truss Manufacturers Association of Australia, to discuss the existing opportunities and search out solutions that will increase the amount of timber and wood based products being used in Australia.
findings, controversies and the take out messages from the 5th Annual Industry Development Conference. 1 pm: Lunch. 1.30 pm-3.45 pm: Women in Forests and timber network meeting: Mentoring for support and success.
A reflection on past conferences
10.15 am: Breakout 3 – Mt Ainsley – Leveraging Australia’s High Standards for Competitive Advantage. Attendees will be invited to participate in the debate as ForestWorks presents Natalie Reynolds, CEO of FSC Australia, and Richard Stanton, secretary, Australian Forest Standard. They will b joined by Richard Brooks, a director of Australian Standards and CEO of the Cabinet and Design Association, and Simon Dorries, general manager, Engineered Wood Products Association of Australasia, as they extend the debate to consider how Australian standards can be used to ensure trade is fair, safe and equal. Session chair is Tim Woods, principal of Fitzpatrick Woods Consulting and director of IndustryEdge. 10.15 am: Breakout 4 – Murrumbidgee – Unlock the potential of your workforce with the NEW National Workforce Development Fund . It’s easier than before, yet still it requires effort, but the rewards are beyond financial. Hear Australian industry success stories advising you on how to step up the value chain with the National Workforce Development Fund. The session, chaired by Michael Hartman, CEO, ForestWorks, will include a panel of managers from businesses that are currently using the new fund to upskill their employees. 10.15 am: Breakout 5 – Black Mountain – New and Emerging Products – Where is the Future Value? Forestry and wood products manufacturing are typically long run and multi-generational investments. This session considers the longer term, considers new products that may be delivered from cellulosic fibre now and that might make up the value proposition of the future. This may start with energy, but as we observe with dissolving pulps, rayon and cloth production, nanotechnology, advanced pharmaceuticals and composite wood products, the potential is seemingly endless. But who’s got the best sense of where the upside will be in the future? And how do we go about securing it from our current position? Debate will commence with Dr Bob Smith, company director and forest industry expert. Panelists include Graeme Bullock, chair, BioIndustry Partners, Dr Alastair Woodard, director of Wood Products Victoria, and Bob Gordon, managing director, Forestry Tasmania. 12.30 pm: Plenary Session to close the Conference– Federation Ballroom. Emily Rice, a professional reporter with Network Ten, steps out of the MC role after having observed every session and briefly looked at all of the five breakout sessions and reports the key
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issue 238 | 10.09.12 | Page 21
New life sprouts at site of largest wildfire in Alberta’s modern history
A FOREST is rising again across a stretch of boreal landscape north of Fort McMurray in Canada that was destroyed last summer by one of Alberta’s largest wildfires in recent memory. A group from the Alberta Environment and Sustainable Development this month inspected 560,000 ha in the backcountry that burned out of control for two months before 1000 firefighters were able to contain it. It was the largest wildfire in the province since the government started keeping records in 1919. The blaze was likely caused by human activity and spread from 10 ha to 16,000 ha overnight last May. The area had received little rain, and strong westerly winds combined with a low relative humidity created ideal conditions for a wildfire. “We knew we had a situation that was going to cause us some problems,” said Bob Mazurik, a fire behavioural specialist with the province who tracks an area’s susceptibility to wildfires through data collected from more than 100 weather stations. The Richardson wildfire jumped the Athabasca River and eventually covered an area roughly the size of Prince Edward Island, spreading at an average rate of 4.5 km a day. Some areas burned to ash while others were only slightly affected, creating a mosaic of earth tones across the barren land visible from above. A year later, Cordy Tymstra knelt down among the singed
Cordy Tymstra, wildlife science coordinator, checks out regrowth as he looks at a jack pine seedling that germinated after wildfires.
trees holding a budding 50 mm jack pine between his fingers – one of the signs of new life in a forest that has adapted to wildfires for thousands of years. Mr Tymstra is the province’s wildfire science coordinator and says jack pines are a “phenomenal” species that
The dependency of the boreal forest has sparked conversations about allowing more fires to burn themselves out naturally, a strategy that could help reduce huge wildfires
rely on fire for their survival. As soon as the tree is exposed to heat it will release its cones to regerminate. As the resin around the cone melts, hundreds of seeds are released into the ground in a process called a seed rain. “What (the jack pine) gets as a result of the fire is mineral soil, warm temperatures, and more importantly than anything at all, it gets fertilisation – a huge nutrient pulse,” Mr Tymstra says. Aspen and birch trees produce similar offshoots from parent trees to ensure survival. Pointing to a section of dead aspen surrounded by growth roughly 60 cm tall, Mr Tymstra
said the dense bush started to take root within months of the fire. “It’s a really well-designed forest that literally embraces fire, and the whole plant and animal community does too.” Along the forest floor pockets of bicknell’s geranium and pin cherries are also starting to sprout. Both use seed banks that sit in the ground for years until fire breaks their dormancy and they begin to sprout. Nearby, bear and moose droppings are another sign that wildlife has returned. Woodpeckers are usually first to return to an area because of the abundance of bugs in the dead trees. The dependency of the boreal forest has sparked conversations about allowing more fires to burn themselves out naturally, a strategy that could help reduce huge wildfires such as Richardson, which spread in part because of a vulnerable older generation of trees. The difficulty, however, has been convincing the public that fire is part of the “natural evolvement of the forest and it has to happen,” said Geoffrey Driscoll, wildlife information officer with the province. “When a fire does come through it doesn’t burn everything – it not a moonscape afterwards. The boreal forest without fire is like the rainforest without rain.” – The Edmonton Journal
COPYRIGHT NOTICE Items provided in this section of Timber & Forestry E news are drawn from a number of sources. The source of the item is quoted, either by publication or organizations in line with the practice of fair reporting.
Page 22 | issue 238 | 10.09.12
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Nominations Excellence :: Recognition :: Celebration The Queensland Timber Industry Awards are an important means of highlighting excellence in our industry and rewarding organisations who are leading the way in terms of service, innovation and commitment to improving both their business and the industry as a whole. The gala evening when these awards are presented is the only event of its kind; it provides a platform to celebrate our industry, our state and recognise our top performers. This evening is set for Saturday 3 November 2012 at Victoria Park Function Centre, Brisbane. To maintain the credibility of these awards and therefore the prestige and honour they represent for finalists and winners, the judging criteria for 2012 have been adjusted to reflect recent ideals and trends as well as give greater weight to operational areas of importance. The criteria for each category is available to view on the website, www.tabma.com.au - Queensland - Information Sheets - 2012 QTI Awards Criteria.
Award Categories 2012
Best Specialist Timber Merchant
Best Frame & Truss Operation (Metro)
Best Building Materials Centre (Metro)
Best Frame & Truss Operation (Regional)
Best Building Materials Centre (Regional)
Best Timber Manufacturing Operation
Best Timber Wholesale Operation
Best Sawmilling Operation
Best Specialist Service Operation
Trainee of the Year
Best Training Culture
Apprentice of the Year
Best Wholesale Sales Representative
Recognising Women In Forest & Timber
If you wish to nominate please visit www.tabma.com.au - Queensland - News and Events - 2012 QLD Timber Industry Awards Nomination Form and complete an entry for each nomination. All nominations will be kept confidential and only be seen by TABMA Queensland management and judges. Nominations close 15 June 2012. Introducing the Sponsor’s...
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