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issue 244 | 22.10.12 | Page 1
Logging Bill still waits for hearing November last chance this year for passage through the Upper House
For and against .. opinions mixed on illegal logging Bill.
Cont Page 3
This Issue
• FWPA defers levy poll • NZ growers vote on industry direction
US housing recovery stems exports
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and processing of illegally harvested product. Opposition deputy leader and foreign affairs spokesperson Julie Bishop told parliament recently that the government Bill was “all well and good”, but it raised foreign relations and World Trade Organisation compatibility questions. Ms Bishop said Indonesia was rightly concerned about lack of consultation. Canada had complained about unreasonable burdens being imposed on its industry and New Zealand had warned that its industry, which is based almost entirely on plantation
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issue 244 | 22.10.12 | Page 1
INDUSTRY NEWS
FWPA defers levy poll as industry fights hard times A POLL by Forest and Wood Products Australia of processor levy payers to consider an increase in levy rates has been postponed by the industryowned services body. In advice to industry, the chairman Ron Adams said FWPA was still in discussion about the funding of specific grower programs and this might include a small increase in grower levies to support core activities. “The outcome of these discussions may not be known for another few months, which will determine whether a levy poll for growers will be undertaken,” Mr Adams said. Resistance at a Melbourne business forum in July to any ‘immediate significant increase’ in levies by industry to fund the ongoing operations of FWPA reflected poor trading conditions within the sector. While many of the proposed activities still have in-principle support, the deterioration in market conditions has raised concerns about the industry’s ability to pay additional levies, especially from domestic processors. More than 45 industry representatives at the investment review forum could not agree on FWPA levy base proposals which were to be submitted for national consultation through the poll. “The dire situation facing some parts of the industry should not be under estimated,” Ron Adams said. “Over the last few months,
‘Some very sound research investment plans will need to be shelved until additional funds become available’ – Ron Adams Page 2 | issue 244 | 22.10.12
Ron Adams ..long-term future of the forest and wood products sector is very positive..
I have personally visited the CEOs and / or chairs of the top 14 domestic grower and processor levy payers and they confirmed the very tight trading environment. “The general expectation is that the market conditions are unlikely to improve over the
next 12-24 months.” Mr Adams said at the two stakeholder meetings – one in February and the follow-up meeting in July – there had been a constant request for FWPA to focus its activities on market development activities such as its partnership with Planet Ark and the WoodSolutions programs. “Unfortunately, in the absence of additional or other income sources, this focus will come at the expense of investments to research and development programs and will reduce company revenue through lower commonwealth matching payments,” Mr Adams said. “Given this feedback and the general financial situation, the board of FWPA is focused Cont Page 11
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INDUSTRY NEWS
Legislation ‘full of grey areas’ for farmers and private tree growers From Page 1
timber, could be hurt. Papua New Guinea and Malaysia were also unhappy. Ms Bishop said the Coalition would support the Bill in principle, but would move an amendment to delay its implementation until 2015 so stakeholders could be consulted properly and regulations developed. The Illegal Logging Prohibition Bill prohibits the importation of anything containing illegally logged timber (including paper) and the processing of illegally harvested, domestically grown raw logs. It also requires importers of regulated timber products and processors of raw logs to meet due diligence requirements as to their legality. The impact of the Bill falls mainly on sawmillers and importers who must demonstrate that domestic logs and the timber in imported products containing wood were legally harvested. There is no presumption of innocence: in the due diligence regulations, the onus is on millers and importers to prove legality. However, the farming community that includes hundreds of private tree growers has jumped into the fray claiming landholders wanting to harvest trees on their properties already face state laws and regulations. In New South Wales, for example, they must negotiate the Environmental Planning and Assessment Act and the Native Vegetation Act. They must also comply with federal legislation such as the Environment Protection and Biodiversity Conservation Act. Rural industry lobbyist and agribusiness consultant David Leyonhjelm of Baron Strategic Services says these regulations
David Leyonhjelm .. only 2% of Australia’s sawn timber is from high risk countries.
Brent McClendon .. legal loggers are the stewards of the world’s forests..
are full of grey areas. “When does a sapling become a tree, for example? When does allowable clearing of regrowth become illegal clearing of timber? A breach of any of these in the course of harvesting timber, even if no prosecution occurs, could make the sawmiller liable for accepting the logs,” Mr Leyonhjelm said. “Perhaps all this might have some justification if there was a major problem with illegally harvested log imports, as asserted by environmental NGOs. But that is not the case. In reality, 90% of the volume of imported sawn timber imports comes from countries of negligible risk such as the EU, Canada, USA and New Zealand. “Of the remaining 10%, a
maximum of 30% is potentially illegal.” Mr Leyonhjelm says domestic logs comprise 80% of Australia’s sawn timber usage. That means only 2% of Australia’s sawn timber is from high risk countries. Even if 30% of that is illegal, it equates to less than 1% of the total. Even the explanatory memorandum to the Bill puts it into perspective, stating that “Australia’s estimated share of the economic, social and environmental costs of global illegal logging [is] .. around $23 million per annum”. “This is a paltry amount considering ‘social’ costs are invariably an inflated guess,” Mr Leyonhjelm said. “This Bill amounts to taking a giant sledgehammer to crack a tiny nut. It contravenes centuries of sound legal principles involving strict liability and the onus of proof, and offends our major trading partners and risks retaliation against our exports. It deserves to be buried and forgotten.” Meanwhile, the Lacy Act in the US, on which the proposed Australian law is modelled, has received a new swipe from the International Wood Products Association. The IWPA is the leading trade body for the
‘In reality, 90% of the volume of imported sawn timber imports comes from countries of negligible risk such as the EU, Canada, USA and New Zealand’ – David Leyonhjelm
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North American imported wood products industry and represents 220 companies and trade organisations engaged in the import of hardwoods and softwoods from sustainably managed forests in more than 30 countries. Executive director Brent McClendon says, in fact, as written, the Lacey Act undermines the industry’s efforts to preserve the world’s forests. “And no player in the Lacey debate is more dependent on thriving, sustainable, vibrant forests than the wood products industry,” he says. “Our very livelihoods depend on the forests’ continued health and worldwide preservation. This fact is just as true in North Carolina and Oregon, as it is in Brazil, Malaysia and Ghana.” Mr McClendon said Lacey’s critical shortcomings were well known, and the fixes were simple. “You don’t have to look further than the Gibson Guitar case to see one glaring issue. According to the settlement, ‘the government and Gibson acknowledge and agree that certain questions and inconsistencies now exist regarding the tariff classification’ of the ebony and rosewood fingerboard ‘blanks’ that were confiscated. “That is the paradox of the 2008 Lacey Act amendments; the folks who drafted the law sought to give federal agencies the power to go after criminal enterprises that were knowingly trading in illegally sourced wood. But by making the scope of laws and products covered by Lacey so vast, they are creating unknowing and unintended ‘criminals’ out of honest, law-abiding business Cont Page 11
issue 244 | 22.10.12 | Page 3
WORLD VIEW
US housing recovery might slow timber exports from Chile, Brazil
India’s building industry boom gets into the act
A SHARP upturn in the US housing market – apparently unhindered by economic jitters ahead of the presidential election next month – could take some of the heat off an export market busting to flood Australasia with South American timber. Industries that benefit from a boom in house building, such as forestry investment outfits in Chile and Brazil, are gearing up for the US recovery and the increase in lumber prices that has followed it. “Soaring US house builders’ publicly traded stocks is welcome news among forestry management firms,” says Forestry Research Associates, an advisory consultancy based in Washington. “Businesses that run plantations in South America producing timber for house building will be excited to hear that the recovery in the US housing market is going from strength to strength,” says the forest investment group’s analysis partner Peter Collins. These included operations such as Greenwood Management, a multi-national forestry company headquartered in Copenhagen, Denmark, which along with other projects in the region, has expanded its eucalyptus plantings in Brazil. The housing recovery in the US blossomed in September, as the pace of home building surged to a four-year high, according to a US government report. Builders started work at an annual pace of 872,000 homes last month, up 15% from the pace in August. They also filed for permits to build homes at an annual rate of 894,000, up 11.6% from the previous month. Both readings were
Page 4 | issue 244 | 22.10.12
Bouncing back .. housing starts in the US surged to a four-year high in September.
the best since the summer of 2008, before the meltdown in financial markets that caused home lending and building to freeze up. The National Association of Home Builders said its October survey of members found confidence among builders at the highest level since 2006. David Elstone, senior analyst at the Canadian-based investment firm ERA Forest Product Research, says “the outlook for the softwood sector in general is quite positive over the next few years as we go through a growth cycle.” His views are echoed among forestry analysts all over the Americas, who predict increasing timber prices and yields for those investing in plantations. Most of the wood that will be used in the construction of US homes will need to be sustainably sourced. This is
why projects like those run by Greenwood Management in Brazil are so attractive to investors. “Plantations that are run on a cyclical basis are sustainable as new growth always replaces trees that are felled,” says Peter Collins. “Plantations in regions where there are natural forests, like Brazil, can also help to reduce the pressure to use native timbers and instead produce a source of fastgrowing, sustainable timber appropriate for use in a number of construction projects and for furniture making, or even turning into coal.” Investing in alternative asset classes such as forestry has become increasingly popular among those who want to diversify their portfolios against risk and make an ethical choice. Meanwhile, as Prime Minister
‘Businesses that run plantations in South America producing timber for house building will be excited to hear that the recovery in the US housing market is going from strength to strength’
Julia Gillard puts India on the front page once again, the heads of neighbouring timber producers are turning to what has become one of the world’s top 10 industrialised nations. India is blessed with one of the fastest growing real-estate markets in the world. It is not only attracting domestic realestate developers but foreign investors, particularly, nonresidential investors who have a bulk of their shares in the Indian housing market. Despite the global economic gloom as a result of the sub-prime mortgage debacle and ensuing credit crunch, India’s housing sector remains on course for yet another year of double-digit growth. The growth is attributed mainly to a large population base, rising income level, and rapid urbanisation. In view with the ongoing development exhibited by the housing construction industry in India, it is expected that the sector will overtake other industrial sectors in terms of contribution to the GDP growth during the next few years. The country’s booming real estate and housing market jumped 80 times between 2005 and 2010. However, India is likely to face severe shortage of timber to meet its requirement from both the domestic and international fronts. It is estimated that the demand for timber is likely to grow from 58 million cub m in 2005 to 153 million cub m in 2020. The supply of wood is projected to increase from 29 million cub m in 2000 to 60 million cub m in 2020. The productivity of timber in India is only 0.7 cub m per
Cont Page 8
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WHAT’S ON?
OCTOBER
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
18: AFS Ltd certification seminar, Brisbane. An update update on development in certification. Topics include a general introduction to forest management and chain of custody certification; an international context to certification; linkages between certification and GBCA green star, government and company procurement policies, and illegal logging legislation; and general information on how to achieve chain of custody certification. Contact Richard Stanton on (02) 6122 9000 or email richard. stanton@forestrystandard.org.au 25: Australian Forestry Standard Ltd annual general meeting and certification seminar, Melbourne. The seminar will provide members
and interested stakeholders with an update on developments in certification and a report on progress in the review of the forestry management standard AS4708. Contact Richard Stanton on (02) 6122 9000 or email richard.stanton@ forestrystandard.org.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
NOVEMBER
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EVENTS
3: Queensland Timber Industry Awards Night – Victoria Park Function Centre, Brisbane.
26: FSC Australia 6th Annual Excellence awards, Melbourne This year sees a redesign of the awards, and the introduction of three new awards categories. Visit www.fscaustralia.org 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 April 7-10:
6th International Woodfibre Resources andTrade Conference, Istanbul, Turkey. ‘Woodchips and Biomass for Global and Regional Markets’. Hilton Istanbul Hotel. Discounted rooms for conference delegates if booked via the online process. Book before November 2, 2012 to ensure a room. Visit www. woodfibreconference.com 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
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. 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 244 | 22.10.12 | Page 5
INDUSTRY NEWS
FWPA directors elected during forest grower forum in Gympie
TWO directors have been returned and industry identity John McNamara was appointed to the board at the annual general meeting of Forest and Wood Products Australia in Gympie last week. The AGM was held during the Australian Forest Growers conference in the Wide Bay regional city, 160 km north of Brisbane. Mr McNamara has more 30 years’ experience in the forest and forest products industry and until recently was managing director of Hyne, a position he held for 18 years. He is managing director and a significant shareholder in DTM Timber, based at Maryborough, a company that specialises in native forest management and harvesting, sawmilling, value adding processing and distribution, and roof truss and wall frame manufacture and distribution. Mark Grey and Nick Roberts completed their terms as directors of FWPA. Evan Rolley (second term) and John Simon were appointed directors, Mr Simon filling a casual vacancy as a director from July.
Page 6 | issue 244 | 22.10.12
John McNamara
John Simon
Evan Rolley
Re-elected FWPA chairman Ron Adams, managing director of Wespine Industries, Dardanup, WA, recognising the economic issues facing the industry, said the board had decided not go forward on a levy poll for the manufacturing sector. He said discussions with forest growers regarding a levy increase were still ongoing. Mr Adams is also president of Forest Industries Federation of WA and a trustee of the J.W. Gottstein Memorial Trust. He holds an Associateship in Mechanical Engineering, is a graduate of the Harvard Business School International Advanced Management
Program and a foundation fellow of the Australian Institute of Company Directors. John Simon was elected deputy chairman of FWPA. He is chief executive of Simmonds Lumber Group and has more than 25 years’ experience in the Australian wood products sector. After completing his Masters in timber engineering, Mr Simon worked in timber research at the Council for Scientific and Industrial Research (CSIR) in South Africa. Since arriving in Australia 25 years ago, he has been the managing director of Sterlands, the largest timber frame and truss producer in Australia; CEO of
national timber distributor Pine Solutions; managing director of merchant and retailer Hudson Building Supplies; and chairman of the Timber Development Association (NSW). Mr Simon is currently a director of the Australian Timber Importers Association. He is a member of the Housing Industry Association’s manufacturers and suppliers council and a fellow of the Australian Institute of Company Directors. Evan Rolley was previously chief commissioner (then managing director) of Forestry Tasmania) and more recently Cont Page 7
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EVENTS
Early interest in Wood EXPO 2013
WOOD Expo 2013, Australia’s first dedicated event for wood processing and manufacturing companies, is already generating keen early interest. Announced by the Forest Industry Engineering Association last month, Australasia’s first wood products show scheduled to run next September is now generating interest from Australasia, North America, Asia and Europe. FIEA director Brent Apthorp says the expo will be unique in this part of the world. “It’s an exciting new concept; it builds on the professionally run series of FIEA technology events that have proved so successful over the past 13 years and will focus specifically on wood products companies rather than aiming to appeal to the full range of other industries within the sector,” Mr Apthorp said. “This means it’s targeted to sawmilling, wood
Wood Expo 2013 will cover all things wood.
manufacturing, kiln drying and wood panels operations. It also has been designed to complement the other major
wood working shows that are well established on the North American and European wood working calendars.”
As the name suggests, Wood Expo 2013will cover all things wood – from log yard handling, sawing technologies, sawdoctoring, wood scanning, wood gluing and laminating, timber machining, lumber QC, mill maintenance, kiln drying, finger-jointing, wood finishing, composite panels and engineered wood products. The expo will be run in two locations – Rotorua in New Zealand and Albury in New South Wales in consecutive weeks. For further information, check the event website www.woodexpo.com
Forest growers meet in Gympie
From Page 6
was Secretary of Premier and Cabinet in Tasmania. He is currently a director of Tasports and operates a successful farming business, Huon Valley Vineyards. FWPA was principal sponsor of the Australian Forest Growers conference which featured a keynote address by Peter deMarsh, chair of International Family Forestry Alliance. Parliamentary Secretary for Agriculture, Fisheries and Forestry Sid Sidebottom participated in the conference and was a featured speaker at the conference dinner where he highlighted the ongoing importance of the forest industry, particularly in the farm forestry sector in relation to sustainability.
www.tanalised.com
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issue 244 | 22.10.12 | Page 7
WORLD VIEW
India opens opportunity for Australia
From Page 4
hectare a year, whereas the world average is 2.1 cub m. The supply of timber is mainly from forest plantations and wood production is showing a negative growth rate. In the absence of adequate supply from domestic sources, the nation has to depend heavily on imports to meet its demand for timber. This will increase the nation’s forest footprint, particularly in southeast Asia, and in order to minimise the forest footprint, India will need to encourage sustainable consumption of timber by
India .. big and colourful and open for business.
promoting forest certification. Ian Bennett, senior manager, international trade, at Australian Business, believes promising exporting opportunities exist in India for Australian companies due to a number of factors. “Over the past four years the Indian government has slashed custom duties dramatically,” he said. “Peak rates of import duties have been reduced to 20% from 40% and further reductions in duties are promised by the government in the near future. “Also, India’s foreign direct investment policy is being continuously revamped by the government to encourage foreign investments, which are now allowed freely in almost all sectors including services.”
Encouraging signs in housing finance ENCOURAGING signs for residential builders have emerged in housing finance figures released this month by the Australian Bureau of Statistics. Combined figures for the construction and purchase of new dwellings increased 4.1% in August, seasonally adjusted. The August figure is up 10.7% from the corresponding figure last year. Chief economist at Master Builders Australia Peter Jones says the figures show welcome signs of improvement for the housing industry, but should be read with some caution. “The positive trend that has emerged in the housing finance figures is a very welcome sign, but does not herald a recovery for the sector just yet. “The figures reveal that housing finance may have found its floor which is encouraging, but also shows that any recovery will be coming from an extremely low base”.
Page 8 | issue 244 | 22.10.12
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INDUSTRY NEWS
NZ forest growers vote on direction industry must take NEW Zealand forest growers will decide the future direction and funding of their industry in a referendum to be held in March next year. “Forestry has a huge untapped potential. To achieve that potential we need a fairer and more cohesive industry where all growers are involved and playing their part,” says the Farm Forestry and Forest Owners associations. Members of the two associations account for more than 80% of the plantation forest harvest, but less than a quarter of the sector’s 10,000plus growers. The aim is to bring all growers into the sector’s information streams and get them involved in decision making and funding. This will mean having a commodity levy on logs and other forest products in the year of harvest. By law, this requires the support of a dual majority in a referendum, with votes counted both by number of growers and by forest area. The levy rate has not been finalised but is expected to be around 40c a tonne. Forest Owners vice-president Paul Nicholls says work that benefits all growers has long been funded by the voluntary subscriptions and efforts of those growers who join an association. “That voluntary work will continue,” he said. “But the challenges and opportunities that lie ahead need the commitment of all growers, not just the enthusiasts. “For example, pests and diseases do not respect property boundaries. So we need all growers involved in forest monitoring and funding biosecurity research and readiness.”
Ian Jackson .. need for higher yields of better quality timber.
Farm Forestry president Ian Jackson says grower representatives made a commitment to increased science funding at a recent pan-industry workshop. “It’s really quite exciting. There’s recognition that in order to increase profitability we need a step-change in the way we do things. We need to produce higher yields of better quality timber and to harvest it more efficiently. That means making a bigger investment in well-targeted research.” Members of the association own or manage up to 100,000 ha of forest, and influence the management of a similar area. These forests consist of radiata pine, cypress, eucalypts, Douglas fir, blackwoods, poplars, other hardwoods, sequoia and NZ indigenous species. The Forest Owners and Farm Foresters are now setting up a board to plan and conduct what will be known as the Forest Voice Referendum. Between 60 and 70% of the funds generated by the levy will be used for science funding. The Forest Voice website www. forestvoice.org.nz will explain the Plantation Forest Strategy and how to vote. It will be live by November 1.
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dennis@industrye-news.com
issue 244 | 22.10.12 | Page 9
EVENTS
Canadian trade official joins speaker panel at conference Industry attracted to timely ForestWorks program
CANADA’S Pacific trade partnerships and market opportunities for forest products in Australia will be outlined by a key international speaker at the ForestWorks industry development conference in Canberra on October 30. Andrew Cadell, trade commissioner and global practice lead, forestry innovations, with Canada’s Department of Foreign Affairs and International Trade, is the latest speaker to sit on the international panel at the conference. He joins Joseph Bachman,
InSurAnce.. It’S All In the SelectIon
director of portfolio management and partner of GFP in Boston USA, and Professor Göran Roos, a world leader in business model innovation in manufacturing who was recently rated as one of the world’s 13 most influential thinkers of the 21st century. Mr Cadell is a former senior trade policy adviser with the Canadian government, and has worked at the Canadian High Commission in Delhi, India. Canada has formally joined the Trans-Pacific Partnership (TPP) trade negotiations, opening new markets and increasing
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Page 10 | issue 244 | 22.10.12
Michael Hartman .. conference a unique opportunity.
Canadian exports to fastgrowing markets throughout the Asia-Pacific region. The TPP is a trade agreement, under negotiation by 11 countries, which now includes Australia, New Zealand, the US, Chile, Malaysia, Singapore and Vietnam. The region is a priority market for Canadian businesses, offering enormous opportunities to its exporters – the TPP market represents more than 658 million people and a combined GDP of $US20.5 trillion. Joseph Bachman is responsible for all GFP’s asset management activities in Australia and New Zealand. He is also fund manager for two of the firm’s commingled private equity timberfunds. Previously, Mr. Bachman headed the global portfolio management team at GFP. Prior to joining the firm, he served in a variety of forest management positions with Champion International Corporation and 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. The federal Minister for Regional Australia Simon Crean will address industry leaders at the ForestWorks conference dinner at Parliament House on October 30. Enthusiastic about the content and support of the conference, ForestWorks chief executive Michael Hartman said growing attendance figures included every industry association CEO. “Most of these CEOs will also be accompanied by some of their directors and specialised staff,” he said. Mr Hartman said that with or without the recent Gunns voluntary administration, there was little doubt the industry was facing tough times. “This conference is a unique opportunity to hear the top minds in the local and global industry as they tackle these issues,” he said. “This is the industry’s chance to step back from the day-to-day and be part of the conversation about where this industry is at and what its options are for the future.” He said conference registrations had accelerated over the past week so those planning to attend should be sure to register now and secure travel and accommodation. (See notice, Page 2).
‘This is the industry’s chance to step back from the day-to-day and be part of the conversation about where this industry is at and what its options are for the future’ – Michael Hartman Advertising: Tel +61 7 3266 1429 Email: cancon@bigpond.net.au
‘We will work to our utmost to help industry achieve its potential’
From Page 2
on realigning investments to industry’s shorter-term priorities. It is also committed to delivering on its mission in the most cost-effective manner possible. “This means that some very successful longer-term programs such as promoting the sector as a career and enhanced tech transfer programs have stopped or have been significantly curtailed. “Some very sound research investment plans will need to be shelved until additional funds become available.” Mr Adams advised that corporate overhead costs were being addressed by reducing the number of directors and full-time staff. Other cost savings being implemented include greater use of electronic reports, teleconferences and webinars. “There is no doubt in my mind that the long-term future of the forest and wood products sector is very positive, but the
road may be very rocky in the short to medium term,” Mr Adams said. “The board and staff of FWPA recognise this situation and will work to our utmost to help the industry achieve its potential.”
owners and consumers, and paradoxically weakening global efforts to combat illegal logging.” According to Holly Gibbs, a research fellow at Stanford’s Centre on Food Security and Environment, cattle ranching and agriculture account for 95-97% of all deforestation worldwide, while logging
EWPs that tick ALL the boxes Engineered wood products manufactured by EWPAA member companies top the list
Forest and Wood Products Australia (formerly the Forest and Wood Products Research and Development Corporation) is funded by the industry and the federal government. Revenue is made up of industry levies on unprocessed wood produced in Australia and a charge on imports of unprocessed and certain primary processed wood products. The levy applies to seven classes of logs – hardwood, softwood and cypress sawlogs, plywood and veneer logs, wood panels pulp logs, hardwood export pulp logs and round log equivalent of imported timber and timber products.
Legal loggers are the only people who replant forests From Page 3
AUSTRALIAN TIMBER DESIGN AWARDS
represents only 2-3%. And legal loggers are the only people who replant the trees after they cut them down, assuring these forests remain as forests, not burned down and turned into cattle pastures. “This simple fact is our simple message, and one I’ve made for years. Legal loggers are the stewards of the world’s forests. We have to be. Our lives depend on it,” Mr McClendon said.
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issue 244 | 22.10.12 | Page 11
REFLECTIONS
Fifteen ‘sunshine boys’ worshipped wood at Brisbane’s Masonic Temple
FIFTEEN men, their working lives bonded by wood, last week walked between grand Corinthian sandstone columns erected almost 85 years ago into Brisbane’s iconic Masonic Temple to gape in awe at the grandeur of the place and the precious timber structures ‘concealed’ inside. Hoo-Hoo members, foresters and Freemasons alike were celebrating Sunshine AusTIS, a conference of forestry and industry leaders held at Caloundra in 1982. All of them were connected to the conference in some way; six of them were on the original conference working committee formed 30 years ago.
Foresters three .. David Gough, Brian Schaumberg and Tom Ryan, a former Queensland Conservator of Forests – and the last to hold that special title.
These included the conference co-chairmen Jim Smart, former Conservator of Forests (198285) and Errol Wildman, who was chairman of the then Queensland Timber Board. Hosts for the day were Dr Gary Bacon, former chief of forestry in Queensland and adjunct professor at Griffith University’s environmental futures centre, and Jim Bowden, vicepresident, Brisbane Timber Industry Hoo-Hoo Club 218. Dr Bacon, who is incoming Grand Master of Freemasons in Queensland, ‘opened the doors’ of the temple – for many years closed to the public – to give the group a tour of inspection.
Page 12 | issue 244 | 22.10.12
Down memory lane .. six of the original members of the Sunshine AusTIS 82 committee enjoy lunch at the Grand Central in Brisbane, from left, David Armstrong, formerly general manager, Queensland Timber Board, Charlie Henry, formerly Charlie Henry Timbers, Jim Smart, Conservator of Forests (1982-85), Gary Bacon, former chief executive, Queensland Forestry, Errol Wildman, chairman Queensland Timber Board (1982-83), and Jim Bowden, founding editor of Australian Timberman (1977) and editor, Timber&Forestry enews.
The building on Ann Street in the heart of the CBD was designed by Brisbane architect and Mason Lang L. Powell and the foundation stone was laid on Anzac Day 1928. Built from Queensland sandstone, marble and timbers, the Freemasons Ann Street Memorial Centre is the headquarters of the craft in Queensland and a Masonic memorial to lives lost in world wars. The Grand Hall features the original furniture from Queensland timbers – northern silky oak, maple and red cedar – one of the state’s largest pipe organs and gold leaf gilded ceilings. The furniture was built within the building, the timbers lowered through the roof to joiners who worked in the open space. Dominating the furniture is the Grand Master’s throne, carved
from a single tree trunk of northern silky oak hardwood (Cardwellia sublimis). A giant clock in the Grand Hall keeps time in a wooden casing, also of silky oak, cut into three panels from a single trunk in 1930. A lunch at the historic Grand Central Railway Hotel in Ann Street followed the tour and Jim Bowden, celebrating his 35th year as a timber journalist, reminded the gathering that the Hoo-Hoo Order was founded in Gurdon, Arkansas, USA, in 1892, and is the oldest industrial fraternal organisations in the US, boasting two US presidents, both Freemasons, as members – Theodore Roosevelt and Warren G. Harding. Also, the founding father of Hoo-Hoo was Bolling Arthur Johnson, a Freemason and editor of The Timberman Newspaper in Chicago. Gary Bacon countered with
In the Grand Hall .. David Gough, Bill Philip, Don Towerton and Gary Bacon.
the fact that the order of Freemasonry went back a bit further than this. The first Masonic lodge was founded in London in 1717 and historical documents give evidence to early Freemasons in Scotland as early as 1390. Enjoying the day were industry representatives David Armstrong (Hoo-Hoo number 79526), Freemason Charles Achilles (86519), Don Towerton (83823), Charlie Henry (80739), Tim Evans (85181), Bill Philip (L-84008), Norris Lewis (79540), Errol Wildman (79580) and Jim Bowden (86504), and representing forestry, Freemason Jim Smart (Hoo-Hoo number 79560), Tom Ryan (88729), Dick Pegg (887218), David Gough, Brian Schaumberg and Freemason Gary Bacon.
Old chums in Hoo-Hoo .. Charlie Henry and Bill Philip.
Apologies were received from John Crooke, a Master Freemason and foundation member (1963) of HooHoo Club 218, Alan Jones, president, Club 218, and foresters Norm Clough, Keith Jennings, Tom Just and Lee Kleinschmidt. Brisbane Hoo-Hoo Club 218, Melbourne 217 and Sydney 215 will celebrate their 50th anniversaries next year with Brisbane club hosting a gala celebration dinner at the Victoria Park Convention Centre on August 31.
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FORESTRY AND FOREST MACHINERY
Are unions overlooking concern of job-providers in the industry? Short-term welfare focus won’t help Tasmania
WE all know that when it’s all boiled down that the Australian economy is built on the backs of small to medium-sized businesses – businesses that have the courage to dream, invest, take risks, employ people and hopefully make ends meet. The forest industry is a good example of this truism, with forest contractors and sawmillers a case in point. Many of us know, or have known, the real comfort of being an employee. Most work hard for the boss, but either way at the end of the week – come rain, hail or shine – the pay lands in the bank account. It’s the bosses problem and worry about making ends meet – will there be work next week and production to generate income? And will there be enough money coming in to pay the loan on the gear, buy supplies and pay the troops? It’s not the employees’ concern. Principals of forest contracting companies know this all too well – and they get worried when, in these tough times, bills mount up and income reduces. Keeping business going is critical for the survival of the whole forest industry supply chain. For most of the time, insufficient care and attention is paid to the welfare and financial survival of the business owner. Clearly, if businesses fail the whole empire – investors, employees, creditors and suppliers – collapses like the proverbial house of cards. The point I am attempting to make here is that too little effort and support goes to businesses and business success in the forest sector –
Labor’s oversight.
Similarly, with Gunns going into administration, rather than advocate for the business to be supported and reshaped, unions focused solely on workers’ short-term welfare. The CFMEU stated that it would exercise all its powers as a union to ensure Gunns’ workers are paid their full entitlements.
“These workers should be the company’s top priority,” CFMEU national secretary Michael O’Connor said. “We expect either the administrator or the ANZ to ensure they are immediately paid their entitlements.” Jobs in the forest .. support for the forest business sector will contribute to business prosperity, investment, customers .. and jobs.
from hostile government policy to escalating operational costs and indifferent unions. An unholy alliance between the government and unions during Labor’s long tenure in New South Wales contributed, in my view, to volume and jobs in the hardwood industry being cut in half. Union access to so-called ‘structural adjustment’ money and insufficient concern for keeping businesses afloat
Too little effort and support goes to businesses and business success in the forest sector – from hostile government policy to escalating operational costs and indifferent unions
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Deep in the Woods with ..
Strident language but CFMEU public statements express a lack of concern, or perhaps appreciation, of businesses as the engine room of jobs. Redundancy payments are of little comfort in jobs-deficient Tassie.
Business prosperity, investment, customers and jobs should be the clarion call of all – including unions. Equally, union support for the charade masquerading as forest ‘peace talks’ in Tasmania is a joke. Most know the process is really all about closing down more forest-based enterprises and shedding still more jobs – with apparent union support.
Cheryle Forrester contributed to the industry’s radical downsizing during
Am I just being cynical or is the CFMEU really about supporting forestry jobs or Labor-Green alliance governments in Hobart and Canberra? What do you think?
issue 244 | 22.10.12 | Page 13
NEW HORIZONS
Study looks at future direction of forestry in northern Australia Sustainable management of natural resources
A REPORT released this month studies whether commercial forestry is a viable option in northern Australia over the long term. It follows various reviews of the industry which have concluded that, for significant development to occur, a number of key issues need to be addressed including the sustainable management of natural resources and the economic, social and environmental goals of northern Australia. The study lists specific issues that need to be addressed in future forestry industry related developmental activity in Australia. It suggests there is merit in refocusing some of the emphasis and effort presently directed at temperate forest industry R&D, towards northern Australia. The forest industry in the region is small scale and fragmented across a vast landscape. There has been limited plantation establishment in Queensland and the Northern Territory since the 1960s, mainly for sawn wood products and pulp. The utilisation of native forests for timber production has also been small in scale and has played a role in supporting regional and indigenous economic and community development. While the
‘There is merit in refocusing some of the emphasis and effort presently directed at temperate forest industry research and developmental towards northern Australia Page 14 | issue 244 | 22.10.12
Potential .. eight-year-old African mahogany plantation at Daly River in the Northern Terrritory.
potential development of the industry has been explored in the region for decades, little progress has been made. To date the location, variability and extreme climate of northern Australia have presented major
barriers to development.
The size and remoteness of northern Australia present significant challenges for forestry; distance to wood processing facilities, ports and population centres creates
Young sandalwood plantation near Kununurra, Western Australia.
price and competitiveness pressures. This, coupled with the relatively poorly developed infrastructure, needs to be factored into future forestry development planning. The CSIRO Northern Australia Land and Water Science Review concluded that northern Australia may not become an important food bowl to supplement or replace the Murray-Darling Basin. Also, with the exception of sandalwood, larger scale tree plantation establishment would need to be rain-fed. On the basis of the research underpinning the report it is suggested that there is merit in refocusing some of the emphasis and effort presently directed at temperate forest industry research and developmental towards northern Australia. On the basis of the research underpinning the report it is suggested that there is merit in refocusing some of the emphasis and effort presently directed at temperate forest industry research and developmental towards northern Australia. The report concludes that by doing so the opportunities identified to expand the tropical forestry and forest products industry based on sound commercial, planning, advocacy and research foundations could be progressed. The report is available from the Rural Industries Research and Development Corporation, telephone (02) 6271 4100 or email rirdc@rirdc.gov. au or John Halkett, director, Forestlands Consulting Pty Ltd on email john.halkett@bigpond. com
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ISSUES
Government needs to have Tassie special timbers on its arts agenda
SENATOR Richard Colbeck, Opposition spokesman for forestry, has asked what the Labor government intends to do about the devastating impacts of proposed forestry changes on stocks of Tasmanian special timbers. Senator Colbeck asked in estimates if the Minister for the Arts and for Regional Australia Simon Crean had called for an examination into the impact on the arts and artisans if supplies were cut. “The Special Timbers Study of 2009 found there were 2000 full-time jobs in the Tasmanian special timber sector, with a further 8500 engaging as a hobby or to a limited commercial extent,” Senator Colbeck said. “That’s more than 10,000 Tasmanians who will be impacted if our concerns about the forestry process come to fruition. “Beyond the direct impact, there will be flow-on effects through to the tourism industry, and it could wipe out high-value activities, such as Tasmania’s wooden boat building sector.” The verification process used as the basis for Tasmania’s forestry talks identified 12,500
King of boat timbers .. inspecting Huon pine at Huon Pine Sawmill in Strahan, Tasmania.
cub m of timber, comprising 10,000 cub m of blackwood, and the balance having all other species including Huon pine, King Billy, celery-top pine, myrtle, sassafras and musk. “Forestry Tasmania’s analysis of the original greens claim under the IGA was that it would deliver 6700 cub m of blackwood and 500 cub m of non-blackwood species – a reduction of 80%,” Senator Colbeck said. He said this was a critical issue for those engaged in activities with special timbers. “The nature of this is that a
Huon pine boat is a Huon pine boat,” Senator Colbeck said. “There is no alternative. Without the material there is simply no industry. “We’re well into the end game on this process and the government should have an understanding of these issues.” Perhaps the most famous and highly-prized Tasmanian special timber, Huon pine is the stuff of legends. It is Australia’s oldest living tree and one of the oldest known living organisms on the planet. It had a traditional use as the most favoured boat-building timber
due to its natural durability and ease of use. Today, it remains the preferred wooden boat building timber. Huon pine is used across a wide range of products from souvenirs to well designed small artefacts, modern furniture, high class fitout, boat building and repair and sculpture. Freshly milled or dressed, Huon pine wood is initially straw coloured and has a distinct aromatic perfume but ages after contact with air and light to a rich golden colour. It is a very forgiving timber to work across the woodworking disciplines, from turning, veneer/inlay to cabinet making. While care may be needed in finishing due to its inherent oiliness, it produces a high lustre. Birds-eye and figured Huon pine are the most coveted features producing intense lustre in the grain patterns. About 80% of Huon pine forests are conserved in national parks and 15% are managed by Forestry Tasmania, which surveys all salvage / harvest sites and plants Huon pine seedlings to ensure sites are fully regenerated.
TABMA Australia gains stronger national status NEW appointments to the TABMA Australia board from Queensland and South Australia have strengthened the organisation’s national presence. President Peter Hutchison has announced that Michael Gaske of Ozline Timbers in Queensland and Andrew Bone of Bone Timber Industries in South Australia will join the board, effective December 13. “It has long been TABMA’s
goal to become a national association and we feel the inclusion of Michael and Andrew will provide valuable input and assist us in our quest,” Mr Hutchison said. TABMA Australia with more than 800 members already operates in every state except Victoria and through alliances with the Window and Door Industry Council (WADIC) and Hardware Building Traders (HBT).
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Established in 1987 at Boonah in the Fassifern Valley by Michael and Carol Gaske, Ozline Timbers has grown from a small lattice manufacturer to a specialist supplier of both standard size and custommade lattice panels. Originally trading as Boonah Lattice, the business became Ozline Timbers in 2002 and diversified into a wider range of services to include custom made pallets and timber dressing.
Bone Timber, located at Edwardstown, an inner southern suburb of Adelaide, has been a family business since 1919. The company has a wide range of timber mouldings, quality engineered veneer products, specialist building materials and timber profiles. It continuously seeks solutions for the environment and recycles sawdust to produce wood fire briquettes – nothing is wasted.
issue 244 | 22.10.12 | Page 15
INTERNATIONAL FOCUS
Tree compounds could replace plastics and other oil products New frontier opens for pulp and paper sector
RUN a chemistry scan over a typical logger and you’re likely to find numerous materials that he either wears or uses in his job that are made from petrochemicals: plastics, carbon fibre, rubber, synthetic textiles and deodorant. But the molecular building blocks of those materials can also be derived from the trees he harvests, which is opening up a whole new frontier for the forest industry, especially the pulp and paper sector – biorefining. “What bio-refining offers is a new use for wood,” says Mike Rushton of Canadian firm Lignol Innovations Ltd. Lignol’s bio-refinery pilot plant in Burnaby, a large city to the east of Vancouver, breaks wood waste down into its main constituents – lignin and cellulose – which can then be refined into a range of fuels, chemicals and compounds. The company hopes to see the first commercial plant built in two to three years. “As we get better at processing wood into these renewable chemicals and bio-fuels, we will start to build industries that are focused on bio-materials and bio-chemicals,” Mr Rushton says. Lignin can be turned into carbon fibre, resins and additives for concrete. But it’s the cellulose that contains the greatest potential value because it can be broken down into sugars, which are like the stem cell of chemistry.
Page 16 | issue 244 | 22.10.12
Sweet science .. Mark Kirby is turning the sugar from wood waste into gycol, a global commodity on a market worth $18 billion.
“If you have sugar, you can convert that into almost anything,” says James Olson, director of the University of British Columbia’s pulp and paper centre. “Now you’ve got this unlimited amount of polymers and base chemicals that you can make
‘As we get better at processing wood into these renewable chemicals and bio-fuels, we will start to build industries that are focused on bio-materials and bio-chemicals’ – Mike Rushton
almost anything in the world from.” In the value chain, lumber and paper are still the most valuable products made from trees. In recent years, the lumber and pulp and paper industries have also added bio-energy as a third value-added product – such as wood pellets. But, according to bio-chemistry proponents, bio-refining holds the greatest potential. This is because chemical companies are keen to find alternatives to fossil fuels to make things like plastics. “Today all of it is derived from oil,” says S2G BioChem chief executive Mark Kirby. “Those companies are all looking for alternatives to petrochemicals, and the opportunity is in sustainable bio-chemicals.”
S2G BioChem is commissioning a new pilot plant at the University of British Columbia that will turn pulp mill waste into sugars and then into glycols. Glycols are used to make polyester, plastics, anti-freeze and a variety of other compounds. Another cellulose-based material is nanocrystalline cellulose. Super strong, it could be used in electronic memory cards or to improve strength and gloss in paper, paints and varnishes. The black liquor waste produced by pulp mills contains hemicellulose, which can be converted to sugars and then into ethanol or glycol. S2G BioChem estimates the global glycol market to be worth $18 billion. “Companies such as S2G face the same obstacles that renewable energy companies face,” says Mike Hamilton, CEO of Renmatix, an American company that also makes sugar-to-glycol from wood waste. “As long as they can do that cost [competitively] with petroleum-based glycol, they probably have an exciting future,” said Mr Hamilton during a visit to Vancouver as part of a panel at the Pacific Rim Summit on Industrial Biotechnology and Bioenergy. “If they can’t match the economics of the petroleum option, it may just be a science experiment.” – Business Vancouver
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INTERNATIONAL FOCUS
Importers of Chinese plywood fight US anti-dumping petition
PROTESTING the hardwood plywood anti-dumping petition in the US, a group of companies has formed the American Alliance of Hardwood Plywood (AAHP) to ensure the availability of the “unique” plywood product imported from China. The AAHP says the hardwood plywood product manufactured in China uses thinner veneer than that manufactured in the US. Hardwood plywood is used in a variety of products including furniture, cabinetry and components. AAHP is comprised American importers, distributors, manufacturers and retailers, with Greg Simon of Far East American and Gregg Wilkinson of Liberty Woods
International listed as co-chairs of the coalition. Other members listed on the website include American Pacific Plywood Inc., Benchmark International, Canusa Wood Products Ltd., Holland, Ike Trading Co. Ltd., InterGlobal Forest, Laminate Technologies, McCorry Group, Medallion Forest Products, Northwest Hardwoods, Patriot Timber Products, Plywood Tropics USA Inc., Taraca Pacific, TigerPly and US Ply. The AAHP says on its website that, if successful, the antidumping petition “will destroy thousands of American jobs and limit the ability of US manufacturers to compete in the global marketplace.” A press release issued by the group claims the hardwood
plywood product under debate is “not manufactured in the US and would otherwise be unavailable to US customers”. Companies asking for extraordinary import barriers consist of several of the world’s largest hardwood plywood manufacturers who collectively comprise 80% of the US hardwood plywood market. These companies are seeking to increase their market share by driving up the price of imported hardwood used by US manufacturers by more than 300% through tariffs on plywood imported from China. “People need to understand that due to several factors including fibre sources and the manual manufacturing practice employed by the Chinese, this
product has significantly thinner veneer than any hardwood plywood manufactured in the US,” Greg Simon said in a statement.
WOOD has been used as a building material for thousands of years, but when it comes to urban construction, American cities are predominantly steel and concrete. A new design competition, organised by the Association of Collegiate Schools of Architecture, the Bi-national Softwood Lumber Council, and Parsons The New School for Design, seeks to change that mindset. ‘Timber in the City: Urban Habitats’ challenges architecture students and young professionals, working individually or in teams, to design a mid-rise, mixed-use complex for a site in a Brooklyn waterfront neighbourhood, an industrial and residential area that is currently in flux, with a population of public housing residents and working artists
and designers, and a number of new residential and commercial developments such as Ikea. With a focus on regenerating the urban manufacturing sector and addressing New York’s housing needs, entrants are being tasked with incorporating affordable housing units, a bike sharing and repair shop, as well as a vocational, manufacturing and distribution centre for the innovative use of wood technology. “Timber is ideal for green building – it has a lower overall environmental and carbon footprint than other materials and is renewable,” says Cees de Jager, executive director of the softwood lumber council. “Wood is well suited for a broad range of structural and aesthetic applications, is high performance, and, in many
cases, is a more economical choice.” Innovations in wood technologies are offering new opportunities for large-scale construction in this sustainable material. From long-span laminated beams to crosslaminated timber panels, wood has proven to be a safe and durable for urban settings. Entrants will be challenged to propose construction systems that draw optimally on the performance characteristics of a variety of wood technologies, and incorporate the creative and innovative use of wood in its design. A distinguished panel of judges will award the winning teams with cash prizes totalling $US30,000, and the projects will be publicly exhibited at the 2014 ACSA Annual Meeting
in Miami and the American Institute of Architects 2014 Convention in Chicago. “At Parsons, our students and faculty have seen first-hand how wood can serve as an ideal green building material in an urban setting,” says Andrew Bernheimer, director of the Master of Architecture program at Parsons. “It has become clear to us that wood is not only environmentally friendly, but also affordable, through recent design-build projects such as Empowerhouse, our entry into the Solar Decathlon, which won the affordability category and is now being constructed by Habitat for Humanity of Washington, DC.” Entrants must register by March 6, 2013, and submit their project by May 22, 2013.
“For those businesses that manufacture products requiring a thinner veneer, this is their only option.”
He said there were more than1000 US companies, most of which are small businesses, that relied on the importation of this type of hardwood plywood to be competitive in the global marketplace. “The approval of this tariff would severely jeopardize these companies and the tens of thousands of US jobs they support,” he added.
Contest: timber the way for green building
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.
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issue 244 | 22.10.12 | Page 17
INDUSTRY NEWS
Invitations are due to be sent out, however you can get in early and book your table or seat at this year’s Queensland Timber Industry Awards Gala Evening. rd The event will be held on Saturday 3 November 2012, at Victoria Park Functions Centre. This prestigious industry event will showcase and recognize our industry’s finest. This is the ONLY event of its kind for the Queensland Timber Industry and it is our chance to recognize those who excel in their chosen field. Tickets are $143 each or a table of 10 is $1,325 GST inclusive. Phone Alicia on 3254 3166 or email alicia@tabma.com.au Tickets includes 3 course meal, 5 hour beverage package and live band. TABMA QLD is proud to be hosting the event, sponsored by a host of businesses including timber industry and commercial entities.
Brisbane Hoo-Hoo Timber Industry Club 218 Inc.
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Page 18 | issue 244 | 22.10.12
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