http://www.islandspecialtytimbers.com.au
Back in December last year I wrote my first report summarizing all tender results for Island Specialty Timbers given that IST itself provides little market information.
https://blackwoodgrowers.com.au/2016/12/13/island-specialty-timbers-tender-results/
So here is my half yearly update and financial year summary of their tender results.
A separate report looks specifically at IST blackwood tender results, given that blackwood is the only specialty timber species for which this information might have some use for market and investment purposes. No one is going to invest money based on the tender results for the other specialty species, which are too slow growing to allow for profitable investment.
https://blackwoodgrowers.com.au/2017/06/12/ist-blackwood-log-tender-results-2016-17/
Six-monthly update
The last 6 months have seen 4 IST tenders with total volume of 83 cubic metres of specialty timbers put to tender of which 58 cubic metres were sold, and total revenue of $49,100.
Financial year
The 12 months to June 2017 saw IST conduct 8 tenders with total volume of 166 cubic metres of specialty timbers of which 107.5 (64%) cubic metres sold for total revenue of $114,300.
This 166 cubic metres represents about 1% of the annual harvest of special timbers from Tasmania’s public native forests. The rest is sold at Government prices on long term sales contracts.
For harvesting the 166 cubic metres of special timbers in the year Forestry Tasmania received an additional $14,000 from Tasmanian taxpayers as compensation.
Compare this with the 3,000 tonne of specialty timbers auctioned by the Western Australian Forest Products Commission every year:
https://blackwoodgrowers.com.au/2017/05/01/special-timbers-in-western-australia/
The above chart shows the log volumes and average unit prices paid per tender.
The price spike for December 2016 reflects a tender of 7 Huon pine lots.
The highest unit price for the year was a small black heart sassafras log of 0.49 cubic metres that sold for $5,100 per cubic metre!! This is an extraordinary price for such a small log.
The highest total price paid for a log was for a Huon pine log of 1.75 cubic metres that sold for $5,160.
These results show that when subject to competitive forces even the little southern Tasmanian special timbers market can afford to pay very good prices for quality logs.
Three species attracted strong demand and high prices over the year, these being black heart sassafras, huon pine and banksia with average log prices over $1,000 per cubic metre. Celery top pine sold for an average price of $630 per cubic metre. All of these species take 400-1,000+ years to reach maturity so I suspect even these prices are cheap.
Black heart sassafras made up 25% of the successful tendered volume but made up 44% of the sales revenue. Blackwood, the dominant special timber, made up 7% of the successful tendered volume but only 5% of the revenue. Huon pine made up 20% tendered volume and 11% revenue.
Black heart sassafras, blackwood, myrtle and wattle comprised 15%, 24%, 16% and 20% respectively of unsold log volume.
The low volume and variable quality of products tendered by IST makes it difficult to draw conclusions from these results, except to repeat that quality wood is worth big money.
Remember these prices are equivalent to mill door log prices, so harvesting and transport costs are theoretically included in the prices.
And don’t forget these public native forest specialty timbers come to you courteously of an $86.27 per cubic metre direct taxpayer subsidy.
https://blackwoodgrowers.com.au/2016/11/13/special-timbers-subsidised-charade-continues/
Tasmanian taxpayers certainly have abundant generosity (and deep pockets) when it comes to the forest industry.
Special Timbers Welfare State
A mere 7 years after the last special species management plan was produced by Forestry Tasmania in 2010 comes another attempt at failed forest policy in Tasmania.
http://www.stategrowth.tas.gov.au/forestry/special_species_timber_management_plan
This new Plan will open up 420,000 ha of pristine public native rainforest and oldgrowth for taxpayer funded plundering by the special timbers industry. This includes 225,000 ha of rainforest and oldgrowth in conservation reserves.
The Plan is essentially a help-yourself DIY approach to public forest management, with an Open Season on the last of Tasmania’s rainforest and oldgrowth.
After the Executive Summary the Plan begins by trying to tell us how important the special timbers industry is; total industry employment, total value, etc.
It’s like the Government telling us that Centrelink is a commercial business not welfare.
The Tasmanian Government believes in Welfare State Forestry, even whilst in competition with private tree growers! So profitability, good commercial management and responsible forest management are out the door.
This draft Plan is not a business plan.
This draft special timbers management plan begins with the premise that Tasmania’s last remaining oldgrowth and rainforests exist to be plundered…….at taxpayers expense……for the exclusive benefit of a handful of local woodworkers!
This draft special timbers management plan does not begin with the premise that Tasmania’s premium timbers should be sold into competitive open markets to help fund schools, roads and hospitals.
Nor does the Plan even consider whether these forests are more valuable left untouched.
In 2010 the special timbers industry was formally admitted into Tasmania’s Welfare State. This new draft management plan now takes that Welfare State to a whole new level of plunder, waste and welfare.
The only basis for a successful forest industry is profitable tree growing.
This Plan represents the exact opposite. It’s a disaster for current and potential private blackwood growers.
The draft Plan is open for submissions until 9am Monday 28 August 2017. Submissions can be sent directly to the Department of State Growth by emailing: specialspecies@stategrowth.tas.gov.au
The Plan will become law once it is signed and gazetted by the Minister.
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Posted in 2018 State Election, Commentary, Forestry Tasmania, Management Plan, Politics
Tagged Welfare State Forestry