Competition, level playing fields and subsidies

log truck

The forest industry in Australia has some serious basic issues that need to be fixed before anyone is going to take the industry seriously.

This is one of them.

It has to do with competition, level (commercial) playing fields, ratepayer subsidies and community support.

In Australia we can have the situation of two forest owners who are neighbours, one of whom pays local Government rates (taxes) on their forest land and the other does not.

One owner gets to use local Government roads to carry logs for free, the other has to pay rates to help maintain the roads. The former gets a subsidy (free roads) from his neighbour (and other ratepayers), to the competitive disadvantage of his neighbour, and any other landowner thinking of growing trees for wood production. Why compete against growers who get to use the roads for free.

And why subsidise these forest growers anyway? Everyone else pays rates!!

It’s an astonishing situation.

And local Governments around Australia are complaining more and more. Here are two recent examples:

Oberon mayor will continue fight for better deal on forestry land

Lithgow City Council joins call to abolish Forestry rate exemption

This can be either a) State forest agencies not paying rates on either native forest or plantation land, or b) privatised former Government plantation owners being exempt from paying rates such as in Queensland.

The Mayor of Oberon says a lot of very good things in that article. Well worth reading.

How can the forest industry hope to gain community support if it treats local communities with such blatant contempt?

Ratepayers should be marching on City Halls around the country demanding action!

Why are Australians continuing to subsidise the forest industry?

Why does the forest industry accept these deliberate market distortions that destroy competition, inhibit investment and ultimately destroy the industry’s future?

Growing trees for wood production is a business right? Just like every other primary industry.

Removing these deliberate market distortions would help put the forest industry onto a level playing field. It would help make the industry more competitive and encourage investment.

The only basis for a successful forest industry is profitable (unsubsidised) tree growers.

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CERES Fair Wood

CERES-Fair-Wood-Herald-Sun-Ellen-Smith

“Fair Wood seeks to bridge the gap that exists between socially and environmentally conscious timber consumers and small Australian farm-foresters and saw millers.”

https://ceresfairwood.org.au/

https://www.facebook.com/ceresfairwood/

The momentum to create an alternative wood market away from public native forestry and illegal imported timbers is slowly growing in Australia.

Hooray for that!!

Here’s another new business looking to help create that vision.

Ceres Fair Wood is based in Melbourne.

I like the words “bridge the gap”!

At the moment the Fair Wood web page looks just like any other retailer – products to sell.

I hope one day soon the web page also has a “Growers” heading.

As the Fair Wood business grows it should be providing lots of market information back to the farming community, so that farmers get a very real sense that the market wants them to grow wood!!

In my opinion that is what is needed to “bridge the gap”!

Hooray for Fair Wood! Good luck guys!!

Taylor Tasmanian Blackwood Guitar Alert!

Taylor 712ce LTD 12 fret

Ok. Here is a Taylor Limited Edition special.

A 2018 Taylor 712ce LTD 12 fret with Torrified Sitka and [Tasmanian] Blackwood.

It’s not often that Taylor put out a 700 series model featuring Tasmanian blackwood.

This one is a beauty!

Here’s one for sale on Reverb but there are a few others around:

https://reverb.com/item/14352660-2018-taylor-712ce-ltd-12-fret-w-torrified-sitka-and-blackwood

Made using farm-grown Tasmanian blackwood from Tasmanian Tonewoods:

https://tasmaniantonewoods.com/

Bunnings finally takes a stand

Bunnings

I wrote back in May about Bunnings, their fantastic timber policies, and how it was time for Bunnings to live up to those policies when it comes to their support for public native forestry in Australia:

https://blackwoodgrowers.com.au/2018/05/12/bunnings-timber-price-list-update/

Well it seems the time has come:

https://theage.com.au/politics/victoria/timber-industry-bid-to-prove-its-green-credentials-falls-flat-20180801-p4zuxv.html

Federal and State Governments refuse to resolve the disaster that is public native forestry in Australia so its time (finally) for the market to take responsibility.

Hooray for that!!

Hardware chain Bunnings has put VicForests on notice that it must reduce its impact on Victoria’s native forests or risk losing its custom, after the state-owned forestry company failed in its [third] bid to achieve green [FSC] certification.

Bunnings needs to also issue this warning to Tasmania’s State-owned forest agency Sustainable Timbers Tasmania.

https://bunnings.com.au

http://vicforests.com.au

https://sttas.com.au

Bunnings is Australia’s largest hardware chain with annual turnover of $11 billion and over 31,000 employees. It is Australia’s largest timber retailer.

Bunnings could be about to change the face of the forest industry in Australia and bring the industry into the 21st century.

So what else could Bunnings do to support a real forest industry in Australia?

The future of the forest industry in Australia is with profitable private tree growers.

Bunnings needs to start talking with farmer groups. There is a long road ahead and many years of neglect to make up, but forestry is about the long term.

Since Bunnings is also in New Zealand they should form a partnership with the New Zealand Farm Forestry Association (NZFFA), and support Kiwi tree growers.

Hooray for Bunnings!!!

Addendum

Upon further reflection one has to wonder exactly what is Bunnings hoping to achieve from its warning to Vicforests?

Vicforests has now failed to achieve FSC Certification three times!!

What possible assurances or changes in behaviour can Vicforests provide that will satisfy Bunnings but failed the Forest Stewardship Council test?

Surely a “three strikes” result from the FSC should be enough for Bunnings to stop supporting Vicforests.

Public native forestry in Australia is fundamentally compromised. It cannot achieve suitable environmental, community, political and commercial outcomes all at the same time. That is mission impossible!!

Bunnings and the rest of the timber market need to wake up to this fact.

IST Tender Results 2017-18

It’s time for my annual summary of Island Specialty Timbers (IST) log tender results.

http://www.islandspecialtytimbers.com.au/

This is the only competitive market forest log price data publically available anywhere in Australia.

General

During the year Island Specialty Timbers conducted 7 tenders putting a total of 154 cubic metres of special species logs, craftwood and sawn wood to tender.

Total sold volume was 99.8 cubic metres (65%).

Total tender revenue was $90,900.

201718ISTpricechart

The above chart shows the log volumes and log prices paid per tender. Craftwood and sawn wood are not included in this chart.

The large volume of unsold logs at the April 2018 tender was mostly due to a large parcel of Silver wattle (Acacia dealbata) logs.

201718ISTlogsizechart

The above chart shows the average volume of logs sold at tender by IST. For some context to this chart, the target plantation blackwood log is 1.5 cubic metres in volume (DBH 60 cm pruned to 6 metres). So it can be seen most of the IST logs sold at tender are small to very small in size.

The highlights for the year were a) a tiny black heart sassafras log (1.1m length, 30 cm small end diameter, 0.07 cubic metres volume) that sold for $3,800 per cubic metre. Indeed at this August 2017 tender 5 small BH sassafras logs totalling 0.54 cubic metres sold for a total of $2,025; and b) a very large huon pine log (4.3 cubic metres) sold for a total $4,623.

Two species attracted strong demand and high prices during the year, these being black heart sassafras (BHS) and huon pine, with average log prices well over $1,000 per cubic metre. BHS and huon pine made up 21% and 13% respectively of the sold volume. Blackwood and feature eucalypt/tas oak were the other major sellers at 18% and 23% of sold volume.

In fact 2 tear-drop grain tas oak logs sold for over $1,700 per cubic metre, an extraordinary price for a wood that the market generally regards as a cheap commodity.

Celery top pine sold for an average $580 per cubic metre (3.7 cubic metres total sold).

Silver wattle and blackwood made up 76% and 15% respectively of the unsold volume for the year.

So what can we say with three years of IST tender results in the chart?

Answer: Not much!

There is no apparent trend in price over the last 3 years. Sure the volumes are small, the market is restricted and the quality of produce is highly variable.

What can be said is that even given these limitations the market will pay very good prices for quality wood when it wants to, with maximum prices averaging $3,000 per cubic metre, even for tiny logs!

These tendered log volumes represent less than 1% of the special timbers annual harvest, and a mere 0.01% of the wood harvested annually from public native forest in Tasmania. The rest is sold at Government (non-market) prices on long term, perpetual sales contracts.

According to Forestry Tasmania’s Annual Report in 2016/17 IST sold a total of 829 cubic metres of product [tender and direct sales]. The annual report does not give separate accounts for IST so their income and costs are unknown.

Blackwood

Log8 102017a

In general the IST tender results provide little information that is useful to the marketplace with the exception of blackwood. Tasmanian blackwood is the only Tasmanian “special species” that has the potential to be grown commercially; the other species being too slow growing.

Sixteen blackwood logs (23.5 cubic metres) were put to tender in 2017-18 of which 10 were sold (16.3 cubic metres) for a total of $12,210.

Five of the sold logs (7.6 cubic metres), described as having figured grain, sold for a total of $7,460. These logs averaged 5.2 metres length, 57 cm small end diameter and 1.5 cubic metres volume.

The 5 plain grain logs (8.7 cubic metres) sold for a total of $4,754, an average price of $545 per cubic metre. These five logs averaged 6.0 metres in length, 54 cm small end diameter and 1.7 cubic metres volume. In other words these were good size, quality logs equivalent to what can be grown in a well managed blackwood plantation, which would produce approx. 300 cubic metres of high quality sawlog per hectare at harvest.

This is a very good price and a substantial increase on the last three years.

ISTBWDchart1718

The stand out blackwood results for the year were a) $1,300 per cubic metre for a 1.76 cubic metre log containing tear-drop figured grain, and b) $2,467 total price for a very large (2.53 cubic metre) figured log.

The unsold blackwood logs consisted of a) one huge figured grain log measuring 5.7m length 75 cm small end diametre and 3.4 cubic metre volume, and b) 5 plain grain logs averaging 4.3 metres length, 46 cm small end diameter and 0.8 cubic metres volume.

Remember these are tiny volumes in a small market (southern Tasmania). Whether they represent the broader blackwood market is unknown.

Remember these prices are “mill door” equivalent prices with harvesting and transport costs already “included”. They are not stumpage prices.

Also remember that Sustainable Timbers Tasmania/IST is a taxpayer funded community service organisation bringing these timbers to market from Tasmania’s public native oldgrowth and rainforests:

Tasmanian regional forest agreement delivers $1.3bn losses in ‘giant fraud’ on taxpayers

2012 Martin Custom Shop 000 Tasmanian Blackwood

MartinCS000TBa

https://reverb.com/item/13292794-2012-martin-custom-shop-000-tasmanian-blackwood

Just LOOK at the fiddleback Tasmanian blackwood on this one-off CF Martin guitar!

https://www.martinguitar.com/

It’s currently for sale on Reverb from Brothers Music Shop in Wind Gap, Pennsylvania, USA.

Price is $AU5,900.

Carpathian spruce top, 14 frets, Waverley tuners, herringbone binding and the popular Martin 000 size. What’s not to like?

The detailing is equivalent to a 28 series Martin 000.

Very nice!

MartinCS000TBb

 

Maton Guitars Tonewood Guide

MatonTonewoods

Maton Guitars of Melbourne, Australia has released a stunning new brochure on tonewoods.

https://maton.com.au/timbers

But does the marketing work?

Is it the message for the 21st century?

Whilst we acknowledge and have a deep respect for traditional tonewoods, we are also excited by the potential we have discovered in non-traditional (alternative) woods.

The musical instrument making community is becoming increasingly concerned about the lack of availability of some of their favorite traditional tonewoods. … it would be environmentally irresponsible to keep utilising these timbers without looking for alternatives.

We are fortunate enough to have the support of many of Australia’s most knowledgeable and skilled timber gatherers and continue to try new species….

This last statement completely bowls me over!

Maton still don’t get it do they?

Tonewood is about hunting and gathering??? WTF!!

I thought we had left those days behind. I thought this was the 21st century.

If you want tonewood for the future you need to plant, grow and harvest trees. It is not about hunting and gathering! Those forests have gone!

In the 21st century the future of tonewoods is about THE GROWER – who manages the forest, who plants the trees!

To their credit Maton devotes a beautiful two page spread to blackwood. But the idea that we should be actively growing blackwood for tonewood production still hasn’t entered Maton’s conscience.

MatonTonewoodsBWD

In all 15 tonewoods are described, but very little about where the wood comes from, who grows it or whether is it sustainable. Once upon a time I would have mentioned certification (PEFC/FSC) but my faith in forest certification is gone.

In today’s market it’s not enough to just say “it’s not rosewood” or “it’s alternative”.

The whole point of the “alternative tonewoods” story is not just to demonstrate the woods have good acoustic and aesthetic properties, but that they come from ethical, sustainable, profitable (for the grower) sources.

Maton needs to demonstrate commitment not just to using alternative tonewoods, but to supporting those who grow these quality timbers.

“Gathering” isn’t good enough.

Maton Guitars was a pioneer in the use of alternative tonewoods long before they became important.

It’s now time for Maton to take the next step in their commitment.

Unfortunately this glossy brochure just doesn’t do it!

PS. In their defense most other guitar makers are on the same page as Maton.