Carrabin first inventory

IMG_0482.jpeg

A few months back I had the opportunity to do the first inventory measurement of the Carrabin blackwood plantation.

You can read about this plantation in my previous blogs including the major thinning in 2013:

https://blackwoodgrowers.com.au/2013/11/13/carrabin-first-thinning/

The plantation is now 16 years old and 3 years since its major thinning.

There are still about 20 trees to be removed before the plantation reaches its final stocking of approximately 36 trees. The above picture shows recent thinning in progress.

In all 39 trees were marked and measured. Here are the results:

Carrabin Table

Note that the objective is to grow blackwood trees that have single straight stems pruned to at least 6.0 metres, and a breast height diametre (DBHOB) of 60cm when harvested.

Because of the close initial planting (2x2m) and the delayed thinning, the remaining trees do not have the diameter I would expect for this age. The largest trees are 27 cm diameter.

As these trees rebuild their crowns following the 2013 thinning I expect the diameter growth rate to increase. Another inventory in 5 years will tell us whether this has happened.

This blackwood plantation is a real credit to the commitment and dedication of the owner.

This is how the special timbers industry should be in Tasmania. Not a politically motivated taxpayer-funded junket into our last remaining public old growth forests.

 

 

Review of the DRAFT Tasmanian Wilderness World Heritage Area Management Plan 2014: Director’s report and representations

The Tasmanian Planning Commission (TPC) has just released the TWWHA Managememt Plan 2014: Director Report and Representations.

http://www.iplan.tas.gov.au/Common/Output/TrimWS.aspx?id=811538&ext=PDF

With UNESCO emphatically ruling out it out the issue of logging special timbers in the TWWHA is now dead and buried (at least until the next management plan review).

Timber Harvesting is discussed on pages 11-12 of the TPC report.

However the TPC is clearly confused. It interpreted my representation as supporting special timbers logging in the World Heritage Area!!

Ok! Maybe I didn’t explicitly say NO!

Maybe I was too analytic and not emphatic enough.

https://blackwoodgrowers.com.au/2015/02/10/draft-twwha-management-plan-representation/

So let me make this perfectly and emphatically clear –

In no way do I agree that the Draft Plan “allow[ed] the management of Tasmania’s unique special species timber for sustainable production within legislated categories of reserves …[whilst] not compromising the Outstanding Universal Values for the TWWHA”.

I do NOT support any special timbers harvesting in the TWWHA!!

I just wanted to clear that up and leave no doubt in anyone’s mind.

Resource-sensitive Global Production Networks (GPN): Reconfigured Geographies of Timber and Acoustic Guitar Manufacturing

Taylor300

A few months back I was contacted by two academics based at the University of Wollongong, New South Wales. They are economic geographers and were starting a project looking at local and international tonewood markets.

Chris Gibson and Andrew Warren came to Hobart and I was pleased to catch up and discuss issues around tonewood supply and tonewood markets.

On their way to writing a book on the subject they have published the first academic paper from their research so far.

Chris Gibson & Andrew Warren (2016): Resource-Sensitive Global Production Networks: Reconfigured Geographies of Timber and Acoustic Guitar Manufacturing, Economic Geography, DOI: 10.1080/00130095.2016.1178569

http://www.tandfonline.com/doi/pdf/10.1080/00130095.2016.1178569

Unfortunately this paper doesn’t make for easy reading with 22 pages of dense, convoluted prose.

I would encourage the authors to write a shortened popular version of the paper as I have no doubt they would find plenty of consumer and industry magazines and websites keen to publish.

Here’s my review.

Where in the 1970’s and 1980’s labour costs and shifts in production to cheap labour markets were the dominant force in the guitar industry, today it is access to secure, reliable wood resources that is becoming the major industry driver. This is happening within an increasingly complex, increasingly regulated international trade in wood resources.

Such [increasing] regulation [and diminishing supply] has, since the 1990s, transformed both tonewood procurement and guitar making. A resource-sensitive GPN has emerged in which upstream resource actors are increasingly important, with manufacturing firms responding differently to scarcity and regulation. Other industries dependent on timber, such as paper milling, furniture, and the construction industry are not as species dependent and have been able to switch more easily to substitutes, including quick-growing plantation species sourced locally. Guitar manufacturers for the most part remained bound by the guitar’s type form, requiring timbers with tensile strength, aesthetics of color and grain, and rich acoustic resonance. Moreover, as a form of manufacturing appealing to consumers for whom emotional value and identity-affirming qualities were intrinsic, the industry was encumbered with strong traditions and customer expectations. As Dick Boak, from C. F. Martin & Co., explained, convincing guitarists to switch to instruments made from sustainable materials proved difficult: “musicians, who represent some of the most savvy, ecologically minded people around, are resistant to anything about changing the tone of their guitars”. Put simply, “musicians cling to the old materials”.

As I’ve said previously, guitar companies are often their own worst enemies when it comes to product development, marketing and mixed/confused messages. Even the most evangelical of guitar manufacturers still provide a soft, oblique message to the market when it comes to environmental issues. But the aesthetic and the exotic become the focus when it comes to sales and marketing. Many guitar companies show no concern about resource supply and environmental issues whatsoever.

https://blackwoodgrowers.com.au/2015/08/11/ooops-not-such-a-success/

But there is evidence that consumer and market change is coming. Just a few examples include the No More Blood Wood campaign, the Leonardo Guitar Research Project, and the Musicians for Sustainable Tonewoods:

http://reverb.org/no-more-blood-wood-campaign/

http://www.leonardo-guitar-research.com/

https://www.facebook.com/Musicians-for-Sustainable-Tone-Wood-100977326654291/

The 2009 and 2011 raids on the Gibson Guitar Company by US law enforcement agencies in relation to importing endangered species were a watershed moment for the guitar/tonewood industry, sending shockwaves throughout the marketplace and concerned consumers.

Irrespective of the evidence and veracity of the raids, in August 2012, Gibson settled out of court, effectively admitting to violating the Lacey Act, and agreed to a $300,000 fine.

Since 2011 the international tonewood market has changed dramatically. The paper highlights three strategies being used by guitar manufacturers to adjust to the changing tonewood market:

  • Alternative species
  • Vertical integration
  • Salvage wood

In short, material scarcity in combination with higher degrees of CITES/Lacey Act enforcement made legally sound international procurement of traditional timbers more difficult, inconsistent in quality, and expensive. Accordingly, product innovation ensued, entailing new models that shifted away from rosewoods, ebonies, and mahoganies of potentially suspicious provenance, toward new alternative timbers that satisfied strength, resonance, and aesthetic benchmarks, and that could be sourced either locally or more transparently from countries with robust regulation, certification, and enforcement.

Well that is a trend that is only just beginning. If you look at most guitar websites you will still find rosewood, mahogany and ebony in abundance.

Much of the search for alternative species is focused on other tropical rainforest timbers not on the CITES list. A few American companies are increasing their focus on readily available North American hardwood species. In Australia the two commercial makers, Maton and Cole Clark, are increasing their use of locally grown and native timbers.

Taylor Guitars so far is the only major company following the vertical integration pathway back up the supply chain to timber cultivation, harvesting and milling. This is really only an option for large companies that have the resources necessary to invest upstream.

Rather than engaging in the expensive option of buying land and growing trees themselves, these companies should consider the option of contracting the growing and supply of tonewood to local farmer cooperatives. I’m pretty confident that if a major company pursued this option in Tasmania it would receive plenty of positive support from the farming community.

The third strategy being developed by small-to-medium size guitar companies is the use of salvage wood from specialised “timber hunters”. The problem here is that salvage wood is not a secure long-term resource. It comes with increased risk of resource supply. It also doesn’t help the major manufacturers and therefore the bulk of the guitar-buying public who can’t afford custom built guitars, ie. there are no large volumes of salvage wood available.

 

So how can Tasmanian blackwood feature in these three tonewood strategies?

  1. Tasmanian blackwood is one of the few alternative quality tonewood species that is non-tropical and potentially sustainable. It can be grown in profitable commercial plantations. It is well known in the domestic Australian market but has yet to break into the international market. Efforts by Taylor and Cort to introduce blackwood into international markets will hopeful make progress in this area.
  2. Taylor Guitars have strong links with their Tasmanian supplier (Tasmanian Tonewoods) but have yet to demonstrate any commitment beyond this relationship. To date their vertical integration is confined to the USA, and Cameroon in Africa in partnership with Madinter. Will other major guitar companies follow Taylor’s lead and seek upstream supply relationships?
  3. There is a sizable existing blackwood resource suitable for salvage on farmland across northern Tasmania, from Goulds Country in the east, to Marrawah on the west coast. This unmanaged resource of native remnant and planted blackwood could be used to stimulate farmer interest in growing commercial blackwood, whilst supplying international tonewood markets in the short term, should a major buyer wish to take up this opportunity.

Tasmanian blackwood is discussed on page 19 of the paper.

Following the Australian lead (Maton and Cole Clark), North American tonewood suppliers and manufacturers began importing Australian blackwood to use in high-end production guitars. A species considered invasive in some areas (unlike practically all other tonewoods), Australian blackwood is harvested in small volumes from farms and mixed-forest plantations without the need for invasive harvesting techniques or CITES paperwork (Reid 2006).

I don’t know where the mixed-forest blackwood plantations are? I’ve never heard anything about them. And why mention the invasive bit? The invasive tendencies of other species are not discussed at all. If blackwood is planted on Tasmanian farms where it is already a native how can it be considered invasive?

The only way that the tonewood market can have a secure future is to pay landowners to grow trees. Unfortunately the paper fails to discuss this strategy, I guess because so far none of the guitar companies are actually using this strategy.

Major manufacturers need significant volumes of quality timber and they need resource security to safeguard their investment. This means paying people to actually grow trees, and having strong, long-term relationships with growers.

The paper focuses on the current changing dynamics in the international tonewood market which are still in their infancy.

As the paper states, the current changes are unpredictable and likely to result in unexpected outcomes as new players and new opportunities emerge. The interplay between the consumer, the manufacturer, the supply chain, and the grower will result in significant market changes.

One important piece of information missing in the paper is an estimate of the size of the international tonewood market. In all the dense discussion it is not possible to get a sense of scale of the issue. On pages 10-11 there is a table providing some statistics about example companies, including production and employment, but nothing about tonewood demand.

Another observation is that the paper talks about the tonewood market everywhere from sawmillers/tonewood merchants all the way through to consumers; but fails to discuss forests, plantations and growers. If there’s a tonewood supply problem then not discussing trees and growers seems a bit odd.

So who will grow the tonewoods of the future?

I’m looking forward to seeing what these academics come up with over the next year or so of their project.

Bunnings Timber Price Lists

Bunnings is the largest hardware chain in Australia. When Australians think of timber they think of Bunnings. Bunnings sets the baseline when it comes to timber prices.

https://www.bunnings.com.au/

Bunnings two main timbers are Tasmanian Oak and Radiata pine. If you want timber other than these species you need to go to a specialist timber retailer. But Bunnings don’t show their prices on a per cubic metre basis, so I’ve done the homework.

Firstly the price list for kiln-dried, dressed, Select Grade Tas Oak as at June 2016:

BunningsTOak0616

Tasmanian oak is a native forest hardwood tree, so the costs of growing Tas oak are considerable in terms of management, regulation, roading, harvesting and transport. Most Tas Oak comes from public native forests managed by Forestry Tasmania. Forestry Tasmania is NOT run as a fully commercial profit-driven business, and has received considerable taxpayer subsidies over many years.

So these prices do not reflect the actual cost of growing the timber.

Prices range between $5,500 and $8,500 per cubic metre, with something of a trend of increasing prices for larger dimension timber to (perhaps) reflect the increased cost (to the taxpayer) of growing bigger, older trees.

Next is the price list for Radiata pine.

Radiata pine is a highly domesticated plantation-grown tree species, where scale, volume and efficiency dominate the market. It is grown primarily for the construction and pulp markets. The pine market is extremely competitive so these prices should accurately reflect the dynamic between supply and demand and the cost of production.

The other point to be made here is that Radiata pine must represent the absolute cheapest that solid wood of any kind can be commercially grown. It’s the bargain basement of solid wood prices.

The price list is for Standard grade pine, with Premium clearwood prices shown in yellow.

BunningsPine0616

Growing Premium grade, knot-free pine requires thinning and pruning the plantations at significant cost compared to growing Standard grade, hence the higher price for Premium grade pine.

Does the 100% markup per cubic metre for the Premium pine make it more profitable for the grower? I hope so!

Prices for the Standard Grade pine range between $1,100 and $3,500, whilst Premium grade ranges between $2,400 and $3,500 per cubic metre for a limited range of sizes.

And here we have a retailer selling blackwood for the same price as radiata pine:

https://blackwoodgrowers.com.au/2015/10/19/blackwood-pricing-and-the-forest-industry-1/

It’s completely insane!

According to Bunnings Select grade Tasmanian oak is 2.5 to 5.2 times more valuable than Standard grade radiata pine (when comparing the same sizes), and 1.7 to 2.6 times more valuable than Premium pine.

Given that Tas Oak is much slower growing than pine and is a native forest species (ie. higher cost of production, lower productivity), one would think that a 2x times price premium can in no way reflect the relative costs of production!

No wonder then that our native forest industry is in such trouble with give-away prices like these.

Also given that Tasmanian oak is not generally regarded as a premium appearance grade timber and is relatively abundant, what would be the relative price of select grade blackwood, which is regarded as a premium timber and is relative scarce? Would it be 3.0 times the price of Premium grade pine, ie. $7,500 per cubic metre? Or 2.0 times the price of Select grade Tasmanian oak, ie. $12,000 per cubic metre?

Surely Tasmanian blackwood timber should be priced well above Tasmanian oak!!

For my previous reviews of timber (including blackwood) price lists see here:

https://blackwoodgrowers.com.au/category/price-lists/

IST Blackwood Log Tender Results 2015-16

IST 0815 log23double

In the interests of greater market and price transparency in the forest industry here is my annual summary of blackwood log tender results from Island Specialty Timbers (IST) for the 2015-16 financial year.

This is the only publically available competitive market price data for blackwood logs.

http://www.islandspecialtytimbers.com.au

Unfortunately IST does not produce any market reports or annual summaries of their sales or other activities, which is why I produce this report every year.

During the year 15 lots were tendered across 9 separate tenders. These comprised 11 individual blackwood logs, and 4 log parcels totalling 70.4 cubic metres (100 logs at an average volume of 0.70 cubic metres per log). Total volume tendered was 91.1 cubic metres. This is less than 1% of all blackwood harvested from our public native forests.

This volume compares with 32 and 20 cubic metres of blackwood logs tendered in 2015 and 2014 respectively.

In addition to the IST tenders there were two tenders by Hydrowood during the year, run through IST, one of which included 16 premium blackwood logs totalling 21.4 cubic metres.

http://hydrowood.com.au/

You can read my review of this Hydrowood tender result here:

https://blackwoodgrowers.com.au/2015/12/11/tasmanian-blackwood-sawlogs-at-625-per-cubic-metre/

For the IST tenders the best result for the year was a small (0.68 cubic metres) plain-grain blackwood log (show in the above picture) that sold for $850 per cubic metre.

The worst result for the year was a 30 cubic metre parcel of 44 plain-grain logs that sold for a very low $100 per cubic metre.

One highlight for the year was a very large blackwood log that measured 4.35 cubic metres, with a length of 7.5 metres and a large-end diameter of 98 cm! Unfortunately this log had spiral grain and was deeply fluted so the sale price was only $275 per cubic metre.

Of the four parcels of logs tendered only 2 parcels sold totalling 34.6 cubic metres for an average price of $135.50 per cubic metre, average log volume of 0.72 cubic metres. These are small logs. The average volume of the Hydrowood blackwood logs that sold for $625 per cubic metre was 1.5 cubic metres. An average plantation grown blackwood sawlog contains 1.5 cubic metres.

The table below summarises the IST tender results for the 2015-16 financial year:

IST_Annual table_16

All up the IST tender results for 2015-16 are a mixed bag with indications of a soft market. This is indicated by the low prices for the figured grain logs, by the fact that half the volume put to tender failed to sell, and total blackwood tender sales revenue ($10,096) was 50% down on last year. The real stand out result for the year was the Hydrowood tender at $625 per cubic metre for a large parcel of good size plain-grain logs.

For what it’s worth here is a chart showing IST blackwood log tender price trends for the past 3 years:

IST_Annual chart_16

Unfortunately the volume of IST blackwood tender material is too small and the quality too variable to allow meaningful market/price comparisons between years. Much of the material is of poor quality, or in the case of the log parcels, the logs are of small size compared to what would be produced in a well managed blackwood plantation. Large volumes of large, good quality logs from blackwood plantations should generally command better prices than shown by the IST result.

Wouldn’t it be great if this chart represented more meaningful data?

So whilst an increasing (if still miniscule) volume of blackwood log is being put to public tender by IST, the volume of quality blackwood sawlog from public native forest continues to decline. Half of the volume of special timbers now harvested from public native forest in Tasmania constitutes “non-millable” material in order to make up the politically correct headline figure.

Despite the fact that blackwood comprises over 80% of the volume of special timbers harvested from Tasmania’s public native forests, it comprises only 15% of the volume put to tender by IST. The blackwood market desperately needs more tradability, more transparency and much more commercial credibility.

Caveats:

  1. Island Specialty Timbers (IST) is an enterprise of Forestry Tasmania established in 1992 to increase the recovery, availability and value of specialty timbers from harvesting activities in State forests.
  2. Forestry Tasmania manages its special timbers operations (including IST) as a taxpayer-funded, non-commercial, non-profit, community service. Last year each cubic metre of blackwood log harvested by Forestry Tasmania received a taxpayer subsidy of $82! No private blackwood grower received any taxpayer subsidy.
  3. Note that all logs and wood sold by IST (excluding the Hydrowood logs) come from the harvesting of public native old-growth forest and rainforest certified under AFS (PEFC).
  4. It is unlikely that this tiny set of market-based blackwood log prices is representative of the broader blackwood market.
  5. The dataset is too small and variable in quality to allow any analysis or correlations to be made between price and log quality apart from the obvious result that feature-grain logs attract a significant price premium over plain-grain.
  6. Remember also these tender prices are effectively mill door prices that already include harvesting and transport costs. They are not stumpage prices.

So whilst Forestry Tasmania, the State government and the State parliament all regard the special timbers industry as a taxpayer-funded community service and political play-thing rather than a commercial opportunity, then blackwood’s commercial future remains difficult.

“The lack of price transparency for forest products, particularly from hardwood forests/plantations [in Australia], represents an impediment to the uptake of farm forestry. Unlike other commodities, price information for forest products is not published through the newspaper or accessible online. Better price transparency is required to encourage smallscale investment in trees” (p. 71. FWPA Report PN: PNA243-1112/2, 2013).

http://www.fwpa.com.au/rd-and-e/market-access/229-the-case-for-renewed-development-in-plantations-identifying-forest-values-and-the-constraints-to-attainment-stage-one-and-two.html

This quote from a recent forest industry report says it all. Even the forest industry recognises price transparency is a major issue, but then does nothing about it.

  1. One of the authors of this report was none other than the recently appointed Director of Forestry Tasmania. Does this mean we will see greater transparency and competition at FT?

When will Tasmania get a fully commercial, profitable forest industry, based on profitable tree-growing?

For previous years IST tender reviews see:

https://blackwoodgrowers.com.au/2015/06/18/ist-blackwood-sawlog-tender-results-2014-15/

https://blackwoodgrowers.com.au/2014/06/14/blackwood-sawlog-tender-results-2013-14/

Transforming Australia’s forest products industry: recommendations from the Forest Industry Advisory Council

Transforming_FIAC

I would love to know how many hundreds of forest industry reports, strategies and reviews have been written in Australia over the last 50 years; how many thousands of dust-covered pages now lie forgotten on library shelves?

So here we have yet another new report to join the list:

https://dl.dropboxusercontent.com/u/4187545/Transforming%20Australia’s%20forest%20products%20industry%20-%20Recommendations%20from%20the%20Forest%20Industry%20Advisory%20Council%20May%202016%20(2).pdf (10.7 MB pdf file)

And straight away from the title of the report it is clear where the focus of the report lies, and why we have another industry report already consigned to the dusty library shelves.

The focus is the forest industry, the wood processors. Once again wood growers are the minor party in the scheme of things.

The maxim that the only basis for a successful forest industry is profitable tree growing is completely absent in this report. In fact the word “profit” is completely absent from the report.

This report originated in the Tony Abbott government era when Richard Colbeck, minister responsible for forestry, established the Forest Industry Advisory Council. The FIAC was tasked with developing yet another vision for the future of the industry.

It’s a political document. It’s not a business plan. It’s not a report designed to engage the rural community, nor the broader Australian community.

So why am I bothering to review this new report?

Well at least the report does mention farm forestry, if not in a very encouraging manner.

Farm Forestry features on page 8 of the report under the heading:

Strategy: Expand the productive forest estate in strategic regions – Farm forestry

This is one of 8 strategies in the report, and here are a few of the more positive quotes from the section:

Farm forestry can provide an opportunity to contribute to the industry’s resource needs through increasing the volume of wood.

And another….

Landholders can derive financial returns from farm forestry through improved land values and on-farm benefits. Benefits include: shade and shelter for stock or crops; soil and water protection; erosion control; reversed salinity; and increased biodiversity, landscape and amenity values.

No mention at all of profits or good financial returns from tree growing, just secondary benefits from trees on farms. Are farmers expected to sell their trees at a loss to subsidise the forest industry?

Exciting stuff!!

That kind of talk will definitely ignite the interest of rural community!!

The report then talks about barriers to farm forestry investment and participation.

This confused discussion on farm forestry ends with the recommendation:

Recommendation 5: That industry develops a strategy for expanding the productive forest estate in strategic regional hubs through farm forestry, and identifies the role for government.

Well we already have a strategy developed including a role for Governments. As I identified in an earlier blog it’s called the National Action Statement on Farm Forestry (NASFF). It was written in 2005 and currently resides on one of those dusty library shelves.

https://blackwoodgrowers.com.au/2016/02/25/two-significant-forest-industry-reports-that-went-nowhere/

This new report has a list of references at the end that does not include the NASFF. Curious!

The new report finishes with the following recommendation:

Recommendation 19: That the Australian Government convenes a meeting of state and territory ministers responsible for forestry to discuss issues raised in this paper.

Yet another ministerial meeting. Another talk-fest!

Instead of expecting politicians to solve the industries many problems why doesn’t the report have a list of all the new initiatives that the forest industry is implementing to move towards this new/old vision?

Does the forest industry know anything about profitable tree growing?

Unfortunately there is nothing in this new report/vision for growers of high value timbers such as blackwood.

Martin Custom CE07 Australian Blackwood

MartinCEO7TB_double.jpg

Is a single custom made Tasmanian blackwood guitar worth promoting on this website?

I guess it qualifies if it comes from CF Martin in Nazareth, Pennsylvania, the world’s most renowned guitar company.

And positive blackwood stories are rare enough that even small stories have value.

The fact that I’m a guitar-centric person may also have some influence…

The classical, restrained elegance of Martin’s design ethos is clearly evident in this guitar. I love that colourful edge binding and back strip.

This guitar has a huge, powerful voice that barks twice as loud as you’d imagine.

http://themusicemporium.com/guitars/martin-custom-ce07-australian-blackwood

CF Martin seems to enjoy producing these limited edition models for the collectors market.

This one has already sold so I guess the marketing strategy is working.

Nice work Mr Martin!

Further web searching tells me this guitar is from 2 years ago. Still a good old news story!

For my previous reviews of Martin blackwood guitars see here:

https://blackwoodgrowers.com.au/?s=Martin