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Branchline, Oct 24, 2011

 

Light at the end of the tunnel?

It's been a month of quite momentous and positive change for Forestry Tasmania and the forest industry. Given the magnitude of the change, it's worth bringing you up to date with at least some of the major developments.

Perhaps the most important from our perspective has been the change of ownership of the sawmill at our Southwood site. The mill is one of the most modern in the state and is regarded as a piece of critical infrastructure. The sale by Gunns to Del Vista, a Victorian company with strong Tasmanian links, will hopefully see the mill re-open early in November. We are now in the process of finalising wood supply arrangements with the new owners. It's a welcome relief. During the mill shut down. FT had no option but to stockpile sawlogs. The investment in the mill by Del Vista is a sign of confidence in the Tasmanian forest industry, and again demonstrates that there is a market for Tassie timber. (Media Release).

Today, the ship African Joy is preparing to depart Hobart with a shipment of whole logs bound for Asia. The whole log exports have a dual purpose - the first to deal with the short term excess supply problem caused by the closure of the Triabunna and secondly in the medium to long term to develop value adding opportunities in Tasmania, using wood that previously would have been exported as woodchips to manufacture rotary peeled veneer for the engineered wood products markets. It's a key part of our Innovations Plan, and the market reaction to date has been very encouraging. Over the past week, there have been extra truck movements through Hobart. While we have minimised the impacts of these truck movements, I want to thank Hobartians for their tolerance.(Forestry Innovation Plan)

Contractors, particularly those hard hit by the Gunns decision to exit native forest products, will have a lot of thinking to do over the next few weeks. The Australian Government has released its $45 million Contractor Exit package, and contractors now have until late November to decide whether they want to accept a payment to exit the industry. We understand that for some, who have made their lives in the forest, it will be a traumatic decision. Our thoughts are with you. (Contractor Exit Package)

You might remember that in the last Branchline, I mentioned the Tasmanian Government had provided $1.1m to deal with the stockpile caused by the Triabunna closure and the shortage of sawlog on the north west coast. I am pleased to report the operation is now in full swing. We have moved sawlog from the south to the north west, and arrangements have been made to send pulpwood and sawmill waste stockpiled in the south and the north west to the only remaining woodchip export facility in the north.

In conclusion, some light is emerging at the end of a very long and dark tunnel. The sale of Gunns assets to experienced sawmillers is a demonstration of emerging confidence in the Tasmanian forest industry. There is progress on developing a new rotary peeled veneer industry using low grade logs that would otherwise be exported as woodchips, the choking effect of the Triabunna closure is being dealt with and there is progress on elements of the Intergovernmental Agreement.


Until next time,

Bob Gordon


Managing Director
Forestry Tasmania


 

 


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