Issue274

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issue 274 | 17.06.13 | PAGe 1

NZ industry flexes marketing muscle

THIS ISSUE • Hardwood plantations overtake native forests • Melbourne merchants buy cypress sawmill

Associations amalgamate in strategy to extract best value for wood sector

We’ve got it ..we’ll flaunt it .. New Zealand promotes its ability to meet international demand for solid wood products.

The amalgamation proposal follows recommendations for a reduction in industry organisations set out in a major study by the Wood Council of New Zealand (Woodco), a panindustry body representing the

Cont Page 3

indonesia to burn illegal logs • Kate Carnell to address timber group • Import laws about credibility of information • State law best opportunity to end ‘forest wars’

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forestry and wood processing sectors.

“The amalgamation would provide the wood sector with a stronger, bigger, louder and

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AN amalgamation of New Zealand’s two peak bodies representing wood manufacturers and processors is expected soon as the industry consolidates as part of a master plan aimed at developing new markets and creating opportunities for investment in traditional and emerging technologies.

The Wood Processors Association (WPA) and the Pine Manufacturers Association (PMA) have laid the groundwork to join forces under a contemplated acronym – WPMA, the Wood Processors and Manufacturers Association of New Zealand.

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issue 274 | 17.06.13 | PAGe 1

industry news

Businesswoman and former NAFI CEO to addess timber group Kate Carnell talks about anxiety NOTED Australian businesswoman and former Liberal Party politician Kate Carnell, AO, will be guest speaker at a luncheon meeting of the Timber United Group in Brisbane on July 19.

Ms Carnell’s career in executive management includes three years as CEO of the National Association of Forest Industries (2001-2004) and chair of the Cooperative Research Centre for Forestry.

The Brisbane-born professional will address the T.U.G. meeting in her new role as chief executive of the national depression organisation beyondblue, based in Melbourne.

She was appointed last year by co-founder and chairman Jeff Kennett, a former Premier of Victoria.

T.U.G is an all-industry group, administered by Brisbane HooHoo Timber Industry Club 218, this year celebrating its 50th anniversary.

Group coordinator Jim Bowden said the idea of the occasional luncheons was to get industry players together to meet on common ground and share thoughts, achievements and problems with friends in a relaxed atmosphere.

More than 70 attended the inaugural meeting in May, assuring the success of the concept.

Previously, Ms Carnell was CEO of the Australian Food and Grocery Council. She is also the former CEO of Australian General Practice Network, is a pharmacist by profession and was the first female to become the national president of the Pharmacy Guild of Australia.

Ms Carnell was elected to the ACT Legislative Assembly in 1992, and became leader of

PAgE 2 | issuE 274 | 17.06.13

Improving our industry’s capacity to develop and maintain a skilled workforce ............................

Kate Carnell .. most Australians have had some experience with anxiety.

the ACT Liberal Party in 1993.

She was elected Chief Minister, ACT, in March 1995, and reelected in 1998 becoming the first Liberal woman to be elected as Chief Minister or Premier in Australian political history.

She is honorary ambassador for Canberra and holds an honorary doctorate from the University of Canberra.

Her talk at the T.U.G. meeting will range from mental illness to women in politics – a timely subject as Prime Minister Julia Gillard prepares for the September 14 election.

Ms Carnell says more than three million Australians are living with depression or anxiety.

“Most Australians have had some experience with anxiety, depression or a related disorder, whether they’ve experienced it themselves or had family, friends or work colleagues go through it,” she said. “beyondblue’s work is aimed at achieving an Australian community that understands depression and anxiety, empowering all of us, at any life-stage, to seek help.”

FREECALL

1800 177 001

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(03) 9321 3500

Sydney

(02) 8898 6990

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(08) 8219 9028

Launceston

(03) 6331 6077

forestworks@forestworks.com.au

www.forestworks.com.au

ABN: 58 006 212 693

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industry news

Marketing approach reinforced by alliance with research institutions From Page 1

more influential voice,” say industry observers.

As a united body, both associations, as members, would continue to contribute services to Woodco which has moved quickly on a strategy to transform the sector.

“In the next decade we will see an increase in the New Zealand harvest,” Woodco chair Doug Ducker said.

“We are determined to extract the best value we can from this resource and reinvigorate our sector.”

Mr Ducker said Woodco members were already moving on several market development initiatives designed to maximise returns for traditional forest products. These included a campaign to actively promote NZ timber in Australia, the development of a national timber quality assurance scheme and active promotion of timber to Christchurch home owners as the material to be used in the post-quake rebuild.

Woodco was given the goahead on a $400,000 researchbased initiative to get the highest value out of every cubic metre of timber harvested.

Known as Woodscape, it is modelled on a major study carried out for the Canadian forest products industry in 2009.

The New Zealand forest and wood sector benefits from a pan-industry marketing approach that promotes the economic, social and environmental benefits and life cycle contribution of timber.

This is reinforced by extensive collaboration with research

‘Put a little heart in it – build with wood’ .. Dunedin Mayor Dave Cull and National MP Michael Woodhouse launch the NZ Wood campaign.

Doug Ducker

Jon Tanner

and teaching institutions such as the Structural Timber Innovation Company (STIC) and Scion, the New Zealand Crown research institute. NZ Wood is also an integral member of the International Wood Promotion Network.

In the industry shake-up, Jane Arnott has left NZ Wood as CEO. She was appointed by Woodco in September 2011.

The Wood Processors Association currently represents companies that process between 75 to 80% of New Zealand’s wood. With

Lawrie Halkett

annual export earnings of $3.2 billion and domestic sales of $1.5 billion, the forestry and wood processing industry is the country’s third largest export earner.

WPA members are involved in the manufacture of pulp and paper, engineered wood products, sawn lumber and the fabrication of frames and trusses. Chief executive is Dr Jon Tanner who has spent the last 20 years working in primary industry in New Zealand, Asia, Africa and Europe and has experience as a science

Market development initiatives include a campaign to actively promote New Zealand timber in Australia

manager, director of public policy and as a CEO of primary industry bodies.

The Frame and Truss Manufacturers Association, formed in 1998 by a group of proactive fabricators, merged with WPA in 2009.

The Pine Manufacturers Association was incorporated in 1991 to promote New Zealand’s ability to meet international demand for solid wood value-added products.

PMA comprises small to medium size and corporate businesses engaged in the manufacturer of solid wood items such as furniture and components (including solid and laminated squares, edge glue panels, turnery, bent wood and DIY products), interior fittings and fixtures (mouldings, flooring, panelling, shelving, window, door and stair components), structural products (laminated beams and posts) and exterior products (fascia, door jambs, hand rails, balustrades, weatherboards, outdoor furniture and roundwood products).

Chief executive Lawrie Halkett has worked for more than 30 years in the forest and wood products industry. His industry experience includes five years working for the NZ Forest Service, two years as a volunteer in the Himalayas, establishing a re-afforestation project and 13 years with Fletcher Challenge Forests, managing silvicultural and harvesting operations in Otago, Gisborne and Nelson.

The joint WPA/PMA conference will be held again in October this year in the Rotorua headquarters of Scion.

Strong overseas demand puts pressure on NZ log supply STRONG overseas demand for New Zealand logs is putting pressure on the local supply and pushing up timber prices

for consumers.

According to the Ministry of Primary Industries, New Zealand has experienced

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strong demand from China for its logs in recent years and this is expected to continue.

While good for export values,

the increased demand means people at home are paying

Cont Page 11

issue 274 | 17.06.13 | Page 3

industry news

New state law best opportunity to end Tasmania’s ‘forest wars’

Challenges, but market confidence restored production forests will see the proposed transfer over time of more than 700,000 ha of state forest to the Parks and Wildlife Service,” Mr Whiteley said.

FORESTRY Tasmania is fully supportive of the state’s forest agreement legislation.

“It offers the best opportunity to end the ‘forest wars’ and to restore market confidence in our wood products,” the acting CEO Steve Whiteley said.

The legislation is now law after receiving Royal Assent on June 3.

The Tasmanian Forest Agreement Act 2013 reduces the high quality eucalypt sawlog supply from state forests by 54% to 137,000 cub m a year and designates 515,000 ha of future reserve land.

Some 101,000 ha of this land will be made into reserves later this year, subject to a positive durability report, and

In safe hands .. Steve Whiteley (left), acting CEO Forestry Tasmania receivers a WorkSafe Tasmania award presented by David O’Byrne, Minister for Workplace Relations.

291,000 ha will be made into reserves after October 2014 if Forestry Tasmania has achieved

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Forest Stewardship Council certification.

A further 102,000 ha can be made into reserves after March 2015. A determination on reservation of a final 21,000 ha of land can be made after January 2022.

Mr Whiteley said the passing of the agreement into law was not the end of the process; it marked the beginning of a new set of challenges for Forestry Tasmania, including some significant adjustments to the way the organisation operated.

FT cannot conduct native forest harvesting that requires a Forest Practices Plan in the future reserve land (except areas that can become reserves after 2022). It cannot sell the land or transfer it to any other entity. Nor can it grant a lease or licence over the land for a period of more than 12 months without the permission of the Nature Conservation Minister.

“The agreement and the decision by government that Forestry Tasmania in future focuses on the management of

“Our staff, past and present, deserve public acknowledgement for managing these lands to such a high standard that they are now deemed worthy of reserve status. Some of these areas are even included in the federal government’s nomination for additions to the Tasmanian Wilderness World Heritage Area.

A number of these reserve transfer proposals are subject to the durability provisions of the forest agreement. The most significant of these clauses, as far as Forestry Tasmania’s operations are concerned, is the condition that the organisation achieves Forest Stewardship Council certification.

“Independent of this legislative requirement, we now believe FSC certification is the key to improved market access,” Mr Whiteley said. “Our current and prospective customers have a choice of certification labels – and many are demanding FSC certification.

“We have a great deal of work to do before we reach this goal, especially in the area of community engagement.

“However, I’m pleased to say that work has already commenced and we have formed a project team that has been tasked with integrating the program’s requirements into our operations.”

The passing of the agreement into law is not the end of the process Advertising: Tel +61 7 3266 1429 Email: cancon@bigpond.net.au

WHAT’S ON?

June

18, 19: CLT and massive timber building seminars.

Timber products and systems for the commercial building market.

Massive timber buildings made from CLT, LVL and glulam have revolutionised the use of structural timber in commercial buildings across the world.The seminars are a ‘must’ for those in the design and development industry and guests will be welcome to stay for networking drinks and canapés at the conclusion of the events.

Sydney June 18 at Sydney Masonic Centre. Melbourne June 19 at the Engineers Australia Auditorium. Cost: There is no cost for design professionals. RSVP before Friday, June 14 to Jane Letteri on (02) 8424 3702 or email jane.l@tdansw.asn.au 30-July 3: The New Zealand institute of Forestry conference and awards dinner– Taranaki.

Venue: The Devon Hotel, New Plymouth. Visit NZIFConference. co.nz website for more detail and registration

AuGust 24: (Saturday): The Cat Goes Gold.

Brisbane Hoo-Hoo Club 218 50th anniversary celebration. Fratelli Italian Ristorante, 103 Crosby Road, Albion, Brisbane. Contact 0401 312 087 or 0428 745 455 for bookings.

SEPTEMBER 3-5: WoodEXPO 13 – Albury, nsw.

11-13: WoodEXPO 13, Rotorua, NZ. World leaders in wood processing, manufacturing and new product technologies will speak at the region’s first ‘business-tobusiness’ wood industry show.

The new expo will provide local companies – management as well as production staff – exposure to new technologies that can improve their own efficiencies and productive capability. Leading technology providers from Europe, North America and Asia will join with each of the main equipment and product suppliers from New Zealand and Australia. Full details on the expo, summit and technology workshops are available on www.woodexpo2013.com

OCTOBER 11: Forest and wood Products Australia (FWPA) AGM and research forum. Time: 8:30-10:30 am. Venue: Novotel Rockford Darling Harbour Hotel, Sydney.

Inquiries to Ric Sinclair, FWPA (03) 9927 3200 or ric.sinclair@fwpa. com.au 11: Building stronger value chains – Australian timber industry seminar. Time: 10.30 am-5 pm.

Venue: Novotel Rockford Darling Harbour Hotel, Sydney. Joint hosts: Forest and Wood Products Australia (FWPA); the Australian Timber Importers Federation (ATIF) and Timber Merchants and Building Material Association (TABMA). This will be the industry’s ‘must-attend’ event for 2013. Inquiries to John Halkett, ATIF (02) 9356 3826; Colin Fitzpatrick, TABMA (02) 9277 3100 Ric Sinclair, FWPA (03) 9927 3200 or Eileen Newbury, Leading Edge Events International (03) 9597 0948.

Seminar sponsorship inquiries to John Halkett.

11: Australian timber industry annual gala dinner and awards presentation. Time 7:30 pm onwards. Timber and Building Material Association (TABMA)

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eVents Doltone House, Pyrmont, Sydney.

Pre-dinner drinks 6:30 pm.

Inquiries to Colin Fitzpatrick, TABMA (02) 9277 3100 or colin@tabma. com.au

NOVEMBER 23: TABMA Queensland timber industry gala dinner. Moda Events Portside Level 2, Portside Wharf Hamilton. Contact Alicia on (07) 3254 3166 or alicia@tabma.com.au

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

FeBruAry 2014 17-21: Gottstein wood science Course, Melbourne. Inquiries to Dr Silvia Pongracic (Gottstein Trust), 0418 764 954 or secretary@gottsteintrust. org or www.gottsteintrust.org

MARCH 2014 19: ForestWood 2014 Conference.

Museum of New Zealand Te Papa Tongarewa, Wellington. A panindustry conference jointly hosted

by Forest Owners Association, the Wood Processors Association, Pine Manufacturers Association , Forest Industry Contractors Association and supported by Woodco, NZ Farm Forestry Association and the Frame and Truss Manufacturers Association.

Sponsorship and trade exhibition opportunities will be available from the middle of May 2013. Contact the conference organiser Paardekooper and Associates. Tel +64 4 562 8259.

Email: info@forestwood.org.nz www. forestwood.org.nz

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 274 | 17.06.13 | PAGe 5

WORLD NEWS

Making history . the Gobal Timber Forum launch delegates in Rome.

Global forum builds platform for future objectives and action Gathering in Rome sets international agenda MORE than 80 delegates gathered at the headquarters of the UN Food and Agriculture Organisation in Rome last month for the launch of the Global Timber Forum to discuss its objectives and conclude a roadmap for a way forward.

Presentations focused on key issues ranging from resource security and anti-illegal logging market requirements to opportunities for international timber promotion in green building systems.

Key recommendations include: • Sustaining the resource, managing and investing in the future of forests.

• Involving and engaging NGOs, forest users, governments and financial institutions to demonstrate the benefits of

PAgE 6 | issuE 274 | 17.06.13

forest investment projects.

• Establish a platform for collaborative projects, information sharing and discussing issues such as legality definitions.

• Showcase best practice and company and project case studies.

• Improve the image of tropical timbers.

• Develop a forum for sharing specific experience and practical guidance throughout the timber trade, particularly the ‘overlap’ of Australia’s Illegal Logging Act, EUTR and the US Lacey Act. • Provide better trade information to producers and buyers in producer countries and provide resources to trade associations, supporting

collaboration in wood promotion and marketing.

The forum agreed it should develop and action plan and push for wood use in green buildings, establishing energy use and/or carbon consumption per square metre of buildings as a rallying point for timber in construction.

A membership base for the Global Timber Form would include full and associate members from outside organisations with a small membership fee structure to cover secretariat and communication roles.

The forum agreed a host secretariat should be an independent international organisation which would allocate one person to

manage administration and finances and help establish an official website for member access only and an electronic newsletter.

The concept for the Global Timber Forum (formerly the International Timber Trade Forum) was launched at the Global Wood Mart in Malaysia in October last year.

The ideas was to provide a platform and communication channel to bring together timber and wood processing federations to address topics affecting the industry internationally, exchange ideas and best practice and give the sector a stronger, more coherent voice worldwide.

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industry news

Australia’s hardwood plantations exceed harvests of native forests THE volume of logs harvested from hardwood plantations in Australia in 2011-12 has exceeded the volume harvested from native hardwood forests for the first time.

Releasing Australian forest and wood products statistics, the executive director of the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) Paul Morris said plantation logs (both hardwood and softwood) now comprised 81% of Australia’s total log harvest, compared to 56% in 2000-01.

“The volume of logs harvested from the hardwood plantation estate has grown at an exceptional rate since 200001, increasing from 975,000 cub m to 5.2 million cub m in 2011-12,” Mr Morris said. “This growth was historically driven by strong overseas demand for Australian woodchips.”

Hardwood plantations continue to be grown predominantly for pulpwood in Australia, with 98% of logs harvested from these forests used for paper manufacturing and woodchip exports in 2011-12.

Overall, the supply of logs harvested from both hardwood and softwood plantations in

Australia was 19.2 million cub m in 2011-12, compared to 4.5 million cub m harvested from native forests.

“Although exports of most wood products fell in 201112, woodchips remained Australia’s largest wood product export by value, but at the same time recorded the largest decline in export value,” Mr Morris said.

Meanwhile, the global pulp industry has increased its importation of wood chips over the past 10 years, with

Paul Morris .. woodchips remain Australia’s largest wood product export by value.

Japan and China importing 83% of traded hardwood chips in 2012.

This was the second highest import levels on record, reports the Wood Resource Quarterly.

Japan, China, Finland and Turkey were the largest importing countries last year.

Woodchips are one of the few forest products commodities that have seen a steadily increasing trend in globally traded volumes the past Cont Page 14

Wood Protection

Tough new EU rules THE European Parliament last week adopted sweeping changes to the EU’s accounting framework, including countryby-country reporting for extractive and logging companies.

The tougher reporting rules aim at making payments in those industries more transparent.

They will force extractors as well as loggers of primary forests to provide full details of their payments to federal, national and regional governments on a project-by-project basis.

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Contact the Australian Lonza team for full details of the Lonza value package. phone:1300 650 636 issue 274 | 17.06.13 | Page 7

INDUSTRY SPOTLIGHT

A family of merchants takes over family cypress mill in Queensland Bretts puts Inglewood operation into good hands

By JIM BOWDEN

A GROUP of Melbourne wholesale timber merchants has purchased the Inglewood cypress sawmill in southwest Queensland from Bretts, a family company that acquired the mill in 1946.

“The purchase is a wonderful opportunity for us to expand and market our range of treated wood products in Queensland; it fits in exactly with our plans for the development of the company,” said Alison Gebbing, national sales manager of Outdoor Treated Timber Pty Ltd. Ms Gebbing said the new group of owners – family and staff members – would take over the sawmill on July 1 and her father and managing director Errol James and brother Garrie James would visit the sawmill for a stock take at the end of June.

“Cypress has been a significant part of our business and we have had a long association with Bretts as one of its biggest customers,” Ms Gebbing said.

“ThIs is a good synergy – and a good opportunity also to market our Ecowood products in Queensland.

“As a family business ourselves, we have a strong bond with the family that operates Bretts and we were truly impressed with the work ethic and performance of the mill workers at Inglewood.”

“The sawmill was sold as a going concern and all employees will transfer in their current positions with all entitlements intact,” Bretts managing director Bill Nutting jnr said The mill was established just prior to the commencement of World War 2 and was acquired

by Bretts in 1946. Mr Nutting’s father, Bill Nutting snr, managed the mill from 1948 to 1951.

Up until the advent of

PAgE 8 | issuE 274 | 17.06.13

particleboard sheet flooring, the mill predominantly produced low-cost T&G flooring for the building industry. In more recent times, Bretts identified other markets and sold into most capital cities with some products occasionally exported.

Bill Nutting jnr said the Inglewood mill was sold as part

of a longer term strategy to get out of wholesaling completely and focus entirely on retailing to builders and the Brisbane DIY market He said that while the mill was still very profitable and a valuable part of the Bretts group, it offered no strategic benefit to the Brisbane-based

Charlie .. more than just a snip-pet of information

Barber Charlie Parrella relaxes in his Hendra shop and recalls an Inglewood reunion he had with old friends and customers a few years back.

HOW did you hear about the sale?” Bill Nutting jnr asked me a few weeks ago when we talked about the Inglewood sawmill.

“Charlie the barber told me,” I said.

Italian-born Charlie Parrella is a fountain of knowledge – about Inglewood, the sport of bowls, horse racing .. and his new grandchild.

He has been a tonsorial artist at his Hendra salon in Brisbane since he moved there from Inglewood 45 years ago.

“My mates in Inglewood tell me the cypress mill has been sold,” said Charlie, 71, who started clipping hair in the southwest Queensland town at the age of 16 when he

opened his first barber shop there.

This must be right, I thought; Charlie would know.

He has trimmed the hair and beards of many notables over the years and he cut the hair of Bill Nutting senior both at Hendra and in Inglewood where the Bretts director managed the cypress mill in the early 1950s.

Charlie’s parents arrived in Inglewood from Italy in 1940 when his father took up tobacco growing and worked as a sawmiller.

“He needed a barber so I gave it a go,” Charlie said. And 55 years later he has no thoughts of hanging up his scissors. – JIM BOWDEN

businesses and with the recent signing of a new 25-year log supply agreement, the timing was right to divest.

He said the new owners had indicated they would continue to run the mill as it had been done in recent years and in time they hoped to ramp up production.

Timber Queensland CEO Rod McInnes congratulated the new owners; they would benefit from a secure resource and the government’s guarantee of 25year contracts to licensed timber companies to harvest cypress across state forests in southern and central Queensland.

“Anyone who already had a Crown wood allocation now simply has a 25-year sale guarantee for their allocation,” Mr McInnes said.

“That doesn’t actually change how much timber is logged in the cypress forests each year, just how long the contracts are.”

The mill will trade as Inglewood Sawmill Pty Ltd and the mill’s telephone number remains the same – (07) 4652 1335.

Bretts Timber & Hardware recently announced plans to join the Home Timber & Hardware (Home) group.

“Bretts has been servicing tradies across Brisbane for 100 years, and we’re looking forward to expanding our offer and becoming the ultimate home improvement destination, rather than just a supplier of hardware and timber,” Bill Nutting jnr said.

“Naturally, we will continue our wholesale supply of timber to the building trade.”

Bretts Timber & Hardware remains 100% owned by the Nutting family. The Windsor site in Brisbane will receive a refurbishment to improve the range and layout, while the Geebung site will remain the same.

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eVents

The Brisbane Convention and Exhibition Centre .. venue for AWISA 2014.

AwisA 2014 on track to success

Bookings pass half way mark for big exhibition in Brisbane THE next AWISA exhibition is 14 months away, but the Australian Woodworking Industry Suppliers Association says more than 60% of exhibition space for the event in Brisbane is already booked.

“Many trade shows around Australia would be happy to be booked as well as this four months out, let alone 14 months out,” AWISA general manager Geoff Holland said.

“In the early part of our sales process we obviously concentrate on getting the big exhibitors involved. It’s great to be able to report that the 12 biggest exhibitors from AWISA 2012 have all re-booked and combined will occupy half of the floor space that AWISA has reserved at the Brisbane Convention and Exhibition Centre for August 6 to 9 next year.

“Once we have received these early bookings, it takes three to four months to get each of these applicants to choose their locations, so it probably won’t be until September this year that we will be able to get others in the industry to book

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and choose their stands.”

The move to Brisbane, brought about by the re-development dennis@industrye-news.com of the Sydney Exhibition Centre at Darling Harbour, will PUBLISHER make AWISA 2014 a different Dennis Macready event. For example, AWISA dennis@industrye-news.com is talking to Queensland travel authorities and jointly will promote holiday packages so that those travelling from the August cold of many other mAnAgIng EDITOR parts of Australia (and New Jim Bowden Zealand) will be encouraged to tel: +61 7 3266 1429 add a mid-winter break to their Mob: 0401 312 087 AWISA visit. timberandforestryenews@bigpond.com The exhibition centre is close to the Brisbane airport and is serviced by a good range of hotels. The venue is part of the South Bank riverside precinct and there are about 30 cafes, restaurants and bars within a few minutes’ walk. Also, the Brisbane CBD is just across the river from the South Bank precinct.

AWISA 2014 exhibition inquiries should be directed to Geoff Holland on 0412 361 580 or email info@awisa.com

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ADVERTISIng tel: +61 7 3266 1429 timberandforestryenews@bigpond.com

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

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

issue 274 | 17.06.13 | Page 9

ILLEGAL LOGGING

Import laws will always be about the credibility of the information Illuminating study of trade trade in US, Europe VISITS to the US and Europe on a Gottstein study tour

by Stephen Mitchell drew interesting comparisons between illegal timber trade laws operating in both regions.

He says he was struck by how highly politicised the Lacey Act is in the US while the European Union Timber Regulation is not nearly so politicised.

“However, the EUTR has been in place only three months so there is still a high degree of uncertainty about certain aspects of enforcement of the due diligence requirements,” he said.

“For example, only five of the 27 European Union member countries have finalised enabling legislation. However, these five are the main importing countries.”

Mr Mitchell is sustainability program manager with the Timber Development Association and his study tour, supported by a Gottstein Fellowship, investigated how industry is the US and Europe is undertaking due care and due diligence to comply with the relevant acts.

Both these laws have similar objectives to the Australian Illegal Logging Prohibition Act and Regulation so the tour was timely given that Australian importers and domestic processers must undertake due diligence from November 30 next year.

Mr Mitchell met with more than 30 organisations including importers of sawn timber, veneer and panels as well as industry associations. He also met with a range of regulatory authorities and environment groups in Washington DC, Brussels, Rome and London.

He said in the US it was difficult for importers to know what they

PAgE 10 | issuE 274 | 17.06.13

Meaningful dialogue .. Stephen Mitchell, Timber Development Association (centre) confers with Bart de Turck, Secretary General of the Federation of Belgian Wood Importers, and Andre de Boer, CEO of the European Timber Trade Federation, outside the offices of the European Commission in Brussels.

needed to do to show that they were undertaking due care.

“The controversial Gibson Guitar case, and the subsequent public agreement with the US Department of Justice, has brought a bit more certainty in what importers from high risk areas are expected to do to demonstrate due care,” Mr Mitchell said.

“The companies I spoke with had good systems in place and had a high degree of knowledge of the situation on the ground in the countries where their wood was harvested. The importer association has also been a good source of information about how companies can assess and mitigate the risk of importing illegally harvested

Unloading wood products at Tilbury Port in the UK which has experienced a noticeable drop off in imports from high risk areas since the introduction of the EU Timber Regulation in March.

‘While it was complicated sorting out how companies met the regulations, and the time it took to set up the system, the actual due diligence was quite simple’ – Stephen Mitchell

wood.

The importers he spoke with in Europe had highly developed systems in place.

“What struck me here was that a due diligence system doesn’t have to be complicated. It just has to be methodical.”

Most importers he spoke to have had to make calls to not purchase from particular suppliers from high risk areas if they were not satisfied with the answers they were getting about the timbers origin and/or the quality of the documentation they received regarding its legality.

The support of the industry associations had also been critical in helping importers prepare and comply.

In Europe, the European Timber Trade Federation had been particularly active in developing due diligence tools such as manuals, supplier information gathering and risk assessment and mitigation spreadsheets. This work was supported by funding from the UK government.

“The federation’s work in getting an independent assessment of third party verification schemes and their compliance with the EU timber regulation has also been critical in giving industry, and the regulatory authorities in Europe, a sound basis for confidence in most of these third party schemes,” Mr Mitchell said.

“It has also highlighted areas that need improvement. For example, changes have been made recently in both FSC and PEFC standards to ensure certificate holders comply with the regulation.

“A number of importers from high-risk areas are also using Cont Page 17

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BUILDING SAFETY

Timber for China diverted to fill us housing demand From Page 3

more for timber as wood processors try to secure supply.

ITM’s general manager of marketing and operations Paul Taylor says timber prices in the yard have generally gone up about 5-10% this year.

“The current increase is due mainly to the increasing cost of logs to sawmills,” he said.

“This is being driven primarily by demand from Asia, combined with reduced log supply to China from North American sources.”

Much of the timber that would have traditionally gone to China from North America had been diverted to meet the rebounding US housing market, Mr Taylor said.

Kiwis buying timber would notice a dent in their wallet.

The approximate timber value in a 230-250 sq m house was $12,000, meaning the impact of the timber price increase would be about $600 to $1200, Mr Taylor said.

Fletcher Building – which sells timber through PlaceMakers – also reported an increase in timber prices.

“We have seen domestic wood prices increase by about 7% in the past month, in line with an international increase in log prices,” general manager of investor relations Philip King said.

The latest ANZ Commodity Price Index showed even though China imported fewer logs from New Zealand in May, log prices still jumped 11%.

Mr King believed the increase had been largely driven by the improved demand in the US. In a recent report, the Ministry of Primary Industries estimated that log export volumes would be 7% higher in the year ending June 30 than the previous year.

It also predicted log exports to rise to $4.29 billion in the year, from $4.27 billion a year earlier.

As well as China, demand was also increasing from Russia, the ministry said.

Meanwhile, reports from New Zealand say home owners are building smaller houses to offset the rising cost of construction, including increasing timber prices.

Registered Master Builders Federation CEO Warwick Quinn said timber prices started to move late last year.

“It’s getting dearer and dearer to build a home, but people still need houses. What we are seeing now is a reduction in the size and value of homes being built,” he said.

“Before the crash, houses were usually costing around $250,000 to $300,000 to build.

Now people are building smaller homes at a lower price.”

Canterbury rebuild drives up home building figures NEW Zealand house building grew at its fastest quarterly pace in a decade in the first three months of the year as the Canterbury rebuild and heating Auckland property market spurred the construction effort.

The volume of building work

put in place rose a seasonally adjusted 5.8% to $NZ2.02 billion in the three months ended March 31, accelerating from a pace of 2% in the December quarter, according to Statistics New Zealand, the highest quarterly volume since September 2008.

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issue 274 | 17.06.13 | Page 11

WORLD VIEW ON BUILDINGS

China claims tallest wooden structure: temple rises 153m

.. and Canada puts up a 6-storey CLT condo AS the climb for the world’s tallest wooden building continues, delegates at the Global Timber Forum in Rome were reminded by Chinese delegates that a Buddhist temple in Changzhou City in the coastal province of Jiangsu is still the tallest wooden structure in the world reaching 153.79 m.

Construction of the Tianning Temple began in April 2002 with the opening ceremony five years later attended by hundreds of Buddhist monks.

The 13-storey wooden pagoda is now the tallest pagoda and the tallest wooden structure in the world, taller than China’s tallest existent pre-modern Buddhist pagoda, the Liaodi Pagoda built in 1055 at a height of 84 m.

Although the existing pagoda was built by April 2007, the temple grounds and the pagoda have a history of construction and destruction for the past 1350 years, since the time of the Tang Dynasty (618–907).

Building of the pagoda was proposed by the Buddhist Association of China in 2001, yet providing money donations for the temple was an international effort, as leaders of 108 Buddhist associations and temples worldwide attended the opening ceremony.

On 25 May 2006 the lower levels of the pagoda caught fire but there was no permanent damage giving the timber building a very high fire resistance rating.

Meanwhile, construction is under way in the St. Roch neighbourhood of Quebec City, Canada, on a six-storey condominium development that incorporates cross-

PAgE 12 | issuE 274 | 17.06.13

laminated timber panels.

The building is believed to be the tallest multifamily residential structure constructed of ‘massive’ timber in the province and possibly North America.

“This very unique project marries form, modern design and sustainable construction,” said local councillor Jean Campeau.

“The building allows us to feature massive wood on the ceiling and on chosen walls – CLT panels and glulam beams and columns – while still maintaining acoustic properties.”

Massive timber comprises CLT panels and glulam beams and columns.

The X-lam panels are being supplied by Quebec’s Nordic Wood Structures. The firm previously was involved in construction of a four-storey ‘all-CLT’ condo project in the town of Chibougamau.

Jean-Marc Dubois, northeast sales manager for Nordic, said the St Roch project made use of more than 1000 cub m of CLT as well as 143 cub m of glulam products, manufactured

terrace and pool are located on the fourth floor.

Nordic Structures stepped up to the plate to suggest a wood solution after learning the project, originally designed with a concrete structure, was in limbo.

World’s tallest? The Tianning Temple in China reaches 153.79 m.

at a plant owned by parent Chantiers Chibougamau.

The plant, which manufactures beams, I-joists and crosslaminated timber, is the largest of its kind in North America.

Nordic Wood Structures, which provides architectural and engineering support for its heavy timber projects, acted as consulting architects and structural engineers on the project, undertaken by GM Development.

A common

“Site conditions did not allow the building to be constructed in concrete,” Mr Dubois said.

“It was too massive. At onesixth the weight of concrete, CLT was a good solution.

While we had to make some structural alterations, we were able to maintain the footprint of the building.”

Panels are being installed with a mobile crane. Mr Dubois said installation had been “a fairly fast process,” even though the crane operator had to adjust to the lighter weight of wood.

“The boom operator is really hunkering down,” he said.

The first wall sections were erected in mid-May. The third floor was finalised late in the month, illustrating the speed of construction.

Construction of the $10 million building is scheduled for completion late in June.

“With more than 1200 tonnes of carbon encapsulated in the wood components, this is effectively a carbon-negative project,” Mr Dubois said.

On the rise .. mass-timber multi-family residential structures are sprouting up in Canadian cities.

In addition to the previously completed condo project, Nordic-supplied CLT has been installed on other projects in the province, including a senior citizens’ residence, a warehouse and an arena.

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industry news

Indonesia will burn illegal logs to support verification system THE Indonesian government has tabled legislation to eliminate the practice of auctioning off logs that have been seized from illegal logging operations in order to reinforce the integrity of its new certification system.

Currently shipments of illegal logs seized by Indonesian authorities are usually sold through local timber brokers who can offer them to the industries in need of the logs. However, this has led to accusations that brokers are using this arrangement to launder more illegal logs.

With the implementation of SVLK [Indonesia’s new timber legality verification and certification system] at the beginning of this year, the availability of illegal logs that have been seized has caused confusion.

“In the future there will be no more auctions of seized illegal logs because they have been used for laundering logs with unclear origins,” Dwi Sudharto, director of forest product marketing and processing supervision at Indonesia’s Forestry Ministry, told a media briefing. He expressed hope that with the approval of the bill, all seized illegal logs would

Implementation of Indonesia’s timber legality verification will mean all seized illegal logs will be destroyed together with the ships and trucks transporting them.

be destroyed together with the ships transporting them.

SVLK has been developed by the Forestry Ministry together with Indonesia’s Multistakeholder Forest Program and the Biodiversity Foundation, with support from the British

government, to verify the legality of logs from the point at which trees are felled through to their downstream use. The system is designed to make it much harder for illegal loggers to gain market access (and so help preserve the country’s forests) while supporting sales

With the system in place, Indonesia has the opportunity to take the market share from competitors, such as Malaysia, China and Vietnam

of legally harvested logs on the international log market, which requires the legality of wood and its processed products.

Mr Dwi said that so far 68 forest production concessions, 26 industrial forest permits and 499 wood industries had received SVLK certification, which had been acknowledged internationally.

At the same briefing, Indonesian Trade Ministry foreign trade director general Bachrul Chairi said that world trade had closed itself from wood and wood products whose legality was unclear.

The EU, for example, has applied EU Timber Regulation, the US has the Amendment Lacey Act, Australia applies the Illegal Loggin Prohibition Act and Japan has the Green Konyuho or Goho Wood.

“Indonesia is the only country that has a wood legality system like SVLK,” said general Chairi.

He said that with the system in place, Indonesia had the opportunity to take the market share from competitors, such as Malaysia, China and Vietnam.

“Since the SVLK has been applied, there has been an increase in our wood exports,” he said.

Opportunity: new engineered product

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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.

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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issue 274 | 17.06.13 | PAGe 13

industry news

Japan still the largest woodchip importer, with China catching up From Page 7

decade. With the exception of 2009, when global production of pulp fell by about 10% and the demand for wood fibre was down, international trade of wood chips has increased every year from 2000 to 2011, says WRQ. From 2009 to 2012, global chip trade increased by 6.5 million tonnes to just over 31 million tonnes, valued at over $US5 billion, slightly below the alltime high reached in 2011.

Much of the increase in chip imports has been because of the expansion of MDF production capacity in Turkey and due to major investments in pulp capacity in China.

The top ranking of chip importing countries has changed quite considerably the past five years. Although Japan is still, by far, the largest chip importer, import volumes have declined from a record high of almost 15 million tonnes in 2008 to just over 11 million tonnes in 2012. China, on the other hand, has gone from being a net exporter of chips less than 10 years ago to become the second largest importer of woodchips.

Growing and growing .. global demand for pulp drives rise in imports.

With the expansion of pulp production capacity in China and the lack of domestic fibre

sources, it is likely that China will surpass Japan as the world largest chip importer within

three years, predicts WRQ. Japan and China are the two dominant consumers of globally traded chips. Their dominance is particularly accentuated for hardwood chips, where they imported 83% of the world’s total imports in 2012.

WRQ says pulp mills in Finland, the third largest chip importer, have for a long time relied on residual chips from Russian sawmills with close proximity to the border and on chips from the Baltic States.

This trade has increased in recent years. The fourth on the import ranking list for 2012 is Turkey, which has become a major chip destination in just the past few years.

It is likely that global trade of woodchips will continue to go up in the coming years for two main reasons because – there are limited forest resources in some of the countries which are expanding industry capacity; and some forest companies are making the strategic decision to diversify their supply sources and import woodchips rather than procure marginal fibre supplies locally.

Tree huggers gather in Oregon to challenge world record PORTLAND in Oregon, USA, will attempt to set the Guinness World Record for tree hugging on July 20.

Hoyt Arboretum and Treecology have organised the event and hope to gather “the most people ever simultaneously hugging trees in one place at one time,” said Mark Ross of Portland Parks and Recreation.

The current official world record is 702, set in September 2011 by the Forestry Commission in Delamere Forest, Cheshire, UK. But another group claims to have gathered 902 people

PAgE 14 | issuE 274 | 17.06.13

at the Minnesota Landscape Arboretum in May 2013.

Hoyt Arboretum spokesman Martin Nicholson said the

organisers of the Portland attempt were shooting for about 1200 people. And if breaking the record isn’t

enough of a reward, “all tree hug participants will receive a coupon for a complimentary beverage from one of several participating local breweries,” he said.

He added that in order to adhere to strict Guinness rules, organisers wanted as many participants as possible to preregister for the hug.

Portland Timbers mascot Timber Joey and Friends of Trees mascot Garry Oak will be among the huggers. All proceeds from the event will benefit Hoyt Arboretum.

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Lumber prices drop, but forestry still a strong bet in Canada, USA Industry analysts confident prices will rebound IT was one story in 2013’s first quarter: lumber prices zoomed to meteoric heights, triggering the reopening of shuttered mills and increased production in Canada and the US.’ But in the second quarter, the tale took a twist as prices dropped precipitously. Once nearing $450 per board foot, prices now sit at $348, nearer to the $343 lumber fetched one year ago.

Industry watchers are calling it a price correction and say market fundamentals are still strong for forestry. But they expect to see continued volatility in the short term as the industry irons out kinks in the supply chain.

“I was not surprised about seeing a decline,” says Russ Taylor, president of International Wood Markets Group.

“But I’ve been surprised about how big the decline has been in terms of prices.”

Kevin Eck, a forestry analyst with Ernst & Young in Vancouver, said US-based economists had likely been a little too optimistic in their predictions for the return of the US housing market.

“This over-confidence spilled over to lumber producers,” he said.

“Mills that were operating at

railcar shortages in Canada; there were mills starting up and inventory buildups.”

China is also a factor, with what Kevin Eck called “ridiculous” growth over the past few years now slowing.

Mr Taylor still expects 2013 to be a good year for lumber producers, but companies will still struggle with the effects of emerging from a period of slow growth: finding enough skilled workers, railcars, trucks and truck drivers. Credit continues to be tight in the US, a factor that also affects the businesses.

While the forestry business has always been cyclical, Mr Eck said the ups and downs were now occurring in a shorter period of time.

“High prices always bring out new supply, and we’ll see this over and over again during the next three or four years,” Mr Tayor said.

“Unless you have long-term demand, you’re going to see more of these ups and downs.”

He expects to see prices start to rise in July.

“We’re expecting demand to increase 10% a year for the next two or three years,” he said/ “Those are big numbers.”

– Business Vancouver

Logging on the Boise National Forest in Idaho .. market fundamentals are still strong for forestry.

75% capacity said, ‘hey, let’s ramp it up to 95%’.”

Russ Taylor noted that a mill in Washington and one in Oregon he visited in January had plans to add shifts at that time; at the end of May, they were temporarily shut down.

While mills were pumping out lumber, there were logistics problems in getting the product to market after low production during the recession.

“The whole US supply chain was in disarray,” he said.

“There was a combination of

Kevin Eck .. ‘ridiculous’ growth in China.

Industry in North America expects to see continued volatility in the short term as kinks in the supply cain are ironed out

World’s largest Redd project approved in Indonesia RIMBA Raya, the world’s largest REDD+ project, has finally been approved by the Indonesian government and verified under the Verified Carbon Standard (VCS), a leading certification standard for carbon credits.

The 64,000 ha forest carbon project in Indonesia’s Central Kalimantan Province on the island of Borneo is expected to reduce carbon dioxide emissions by 119 million tonnes over its 30-year life-span. The emissions reductions will come

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from avoiding drainage of area’s carbon dense peat lands and conversion of its forests to oil palm plantations.

According to SCS Global Services, the auditor that verified the project’s carbon

accounting, Rimba Raya reduced emissions by 2.1 million tonnes between July 1, 2009 and June 30, 2010, resulting in the largest-ever number of verified carbon units generated in a single year.

issue 274 | 17.06.13 | PAGe 15

INTERNATIONAL FOCUS

Architect: the day will come when skyscrapers are built out of wood Tall buildings changing conversation about timber CANADIAN architect Michael Green considers himself a champion of wood.

He often wonders why buildings made of wood are only a few storeys high when trees found in nature are astounding for their height.

Vancouver-based Michael Green tried to convey his passion for wood at the 74th annual Maritime Lumber Bureau convention in Charlottetown last week where he was the keynote speaker.

Mr Green isn’t just an average architect. He’s a Fellow of the Royal Architectural Institute of Canada and is recognised around the world for his award-winning buildings. He believes in championing the shift to new ways of building that will complement the intersection of man’s greatest building challenges.

“There is a whole new wave of building coming,’’ Mr Green said. “Wood is the most technologically advanced material you can build with.’’

People often say no two snowflakes are alike. Michael Green believes wood deserves to be described the same way.

“No two pieces of wood can be the same anywhere on Earth. The Earth grows our food and it grows our homes.’’

The dedicated architect proposes building skyscrapers out of wood rather than the more traditional steel and concrete, but he says the latter two account for 47% of the world’s CO2 emissions.

Wood, on the other hand, grows by the power of the sun, giving off oxygen and storing carbon dioxide.

He’s not talking about building these skyscrapers with standard 2x4s. He says the technology exists now to form trees that grow quickly into mass timber panels.

Mass timber, by the way, doesn’t burn nearly as easily as normal wood.

“We’re on the cusp of a real tidal wave of change.’’

Mr Green’s portfolio includes the Ottawa airport and the North Vancouver City Hall renovation project, both of which heavily incorporate wood.

The idea of tall wood buildings caught on in Europe and

Australia and is starting to gain ground in North America.

In London, a nine-storey wood apartment building was completed in 2009 and all of its units sold out within an hour.

The world’s tallest wood building, a 10-storey apartment building, sits in Melbourne.

Mr Green’s firm is trying to pitch a 30-storey wooden structure in New York City that would incorporate some steel.

He also referred to the Timber Tower Research Report which details plans by the same firm that designed One World Trade Centre to establish the structural viability of a 42-storey-tall prototypical mass timber-framed building.

“This will change the conversation about wood,” he says, Michael Green .. we’re on the cusp of a real tidal wave of change.

The technology exists now to form trees that grow quickly into mass timber panels

And, it will most certainly spell good news for those in the lumber industry because demand for wood products will go up.

– The Guardian

Bill allows Oregon to sue protestors in state forests THE Oregon, USA state Senate has approved 25-3 a bill aimed at environmental activists who interfere with logging in state forests.

Senators approved House Bill 2596, which would allow private contractors with the Oregon Department of Forestry to sue environmental protestors for the cost of damaged equipment, employee wages, attorney fees and similar costs.

PAgE 16 | issuE 274 | 17.06.13

The Senate version of the bill sets the statute of limitations at two years instead of six years.

The House, which approved its version of the bill in April, must now approve the change.

Contractors can sue now, but logging proponents describe current law as vague and nebulous.

A companion bill, which would have created the crime

of interference with state forestland management, died in a Senate committee. The House had also approved House Bill 2595 in April over objections from environmental activists and the American Civil Liberties Union of Oregon that it would infringe upon the free speech rights of environmental protestors.

Advocates prioritized stopping that bill over House Bill 2596.

The legislation comes amid divisive efforts to increase logging in Elliott state forest near Reedsport and proposals to increase logging in federal forest lands. Environmental activists affiliated with Cascadia Forest Defenders and Cascadia Earth First! staged protests at Elliott State Forest in recent years and at the Oregon State Capitol in May and June 2012, which led to arrests.

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ILLEGAL LOGGING

Illegal logging: industry well placed to assess and mitigate its own risks From Page 10

other legality verification schemes such as SGS, Bureau Veritas and the SVLK legal wood scheme of Indonesia.”

In summary, Mr Mitchell said that while it was complicated sorting out how companies met the regulations, and the time it took to set up the system, the actual due diligence was quite simple.

“The key is being active rather than passive,” he said. “It’s also worthwhile noting that it is not about ‘proving’ legality.

Asking for a pile of documents or putting onerous conditions in supplier contracts is not due diligence.

“The question will always be about the credibility of the information.”

Mr Mitchell says he has also learnt that it is in the

Ken Walsh .. general manager of Danzer UK, which undertakes due diligence for all its timber imports.

Armand Stockmans .. purchasing director of a Belgianbased importer of hardwood from all over the world.

interests of importers and domestic industries to keep the prescriptive elements of Australian due diligence regulations to a minimum – particularly at this early stage.

“Industry is well placed to assess and mitigate risk

themselves,” he said.

To help propagate the results of the study tour, Mr Mitchell is preparing a report which will be available on the Gottstein Trust website. He will also make presentations at industry events over the next 12 months

as industry prepares for the critical date – November 30, 2014.

The Joseph William Gottstein Memorial Trust Fund was established in 1971 as a national education trust to promote the development of Australia’s forest products industry and perpetuates the name of a CSIRO forest research scientist who was tragically killed in 1971 while photographing a tree-felling operation in New Guinea.

The trust fund provides financial support to people employed in the industry to further their education, develop new skills and allow them to contribute to the industry through their professional development.

The trust has assisted in the funding of more than 100 fellows, among them some of the most prominent industry

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