Monthly Archives: September 2018

The end is nigh!

Bunnings

The public native forest market is shifting quickly.

Wesfarmers, the parent company of Bunnings Hardware and Officeworks, yesterday announced they will only stock FSC certified products by 2020.

http://www.abc.net.au/news/2018-09-17/vic-forestry-industry-at-risk-of-collapse/10255128

This means both Vicforests and Sustainable Timbers Tasmania will cease to exist.

Neither of these State Government forest agencies are likely to achieve FSC certification before then. Bunnings is a major customer for both these agencies products.

In less than a week since its launch the new National Forest Industries Plan has been dealt a mortal blow!

https://blackwoodgrowers.com.au/2018/09/17/national-forest-industries-plan-2018/

Six weeks ago Bunnings gave warning that it was living up to its policies and making a stand against poor forest management practices in Australia:

https://blackwoodgrowers.com.au/2018/08/04/bunnings-finally-takes-a-stand/

All around Australia public native forest management is in crisis.

Stand by for some serious fireworks!

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National Forest Industries Plan 2018

Better

The only basis for a successful forest industry is profitable private tree growers.

And once again the Federal Government and the Australian forest industry have failed to deliver.

Last week the Federal Government launched another plan for the Australian forest industry:

http://www.agriculture.gov.au/forestry

http://ausfpa.com.au/media-releases/morrison-government-promises-a-billion-new-production-trees-sets-new-vision-for-growing-australias-renewable-forest-industries/

Yet another opportunity for Australian taxpayers to give generously to the tune of $20 million over the next 4 years with more to come.

But wait! There is a Federal election due before November 2019.

Surely this is coincidence!

Another forest industry plan so close to an election. Is that pork I smell cooking?

Apologies for my cynicism but I’ve seen this so many times before.

Forest industry plans have a short shelf life in Australia. The Use By Date generally coincides with the next election/change of Government.

The Plan is 15 pages long, 15 pages of marketing and spin with very little substance. Just reading the 2 page Preface tells me that I’ve read all this many times before.

If this Plan was an investment prospectus it would be in the bin within the hour.

The Preface tells me:

  • Its all political;
  • Its all about the sawmillers/wood processors;
  • It even mentions “resource security” which is just another term for industry subsidy.
  • Competitive markets, log prices, market transparency are not discussed at all!
  • It tells me that Farmers will play a vital role. Farmers beware!!! Here’s a typical quote: Working with farmers to secure a long-term ‘wood bank’ for the forest industries’ future…. That’s it! Farmers role is to help subsidise the forest industry.
  • Does the Plan discuss profitable tree growing? Not at all!

The Plan has 15 Actions listed under 4 headings. Every one of the Actions is what the Government/taxpayer is going to do for the wood processors. Not one of the Actions concerns what the forest industry will do for itself.

There is no Implementation Plan. How, who and when are these Actions going to be fulfilled? Based in past industry plans I assume few if any of the Actions will see the light of day.

The word “export” is completely absent from the Plan. Access to log export markets is an essential part of the future of any viable profitable forest industry.

The Plan fails to address the many distortions and blockages in forestry markets in Australia (like Government control and manipulation of log prices). One major issue here is the management and performance of the various State forest agencies. All these agencies MUST be made fully commercial and profitable, or they must be must be shut down.

Many reports have been written highlighting the issues preventing investment in tree planting in Australia. This Plan ignores these issues entirely!

As I said in my previous blog forest policy should not be about sawmillers/wood processors. That is the wrong focus. Good forest policy should be about profitable private tree growers. Once tree growing is demonstrably profitable then the investment in processing will follow.

This Plan is all about sawmillers/processors.

The political and industry spin doctors really had fun with this statement:

The National Farmers Federation’s support for the inclusion of farm forestry tree plantings as a supplement to primary agricultural purposes confirms that farmers are poised to support a bigger part of tree growing in our landscape.

The National Farmers Federation (NFF) has only recently decided that forestry might be a primary industry. To date their interest and commitment has been minimal. They have no policies or farm forestry programs.

The one single positive I can say about the Plan is that it has a stronger emphasis on farm forestry than previous plans, but not in a way I find encouraging.

If you have 30 minutes and want some light entertainment download the Plan and have a read. Then tell me what you think!

Will this Plan ignite the forest industry in Australia?

Or will it join the dozens of previous forest industry plans collecting dust on library shelves around the country?

Cheers!

Sawmillers and forest policy

protest

These recent news items highlight the moral hazard that continues to dominate forest policy and the forest industry in Australia:

https://www.news.com.au/national/breaking-news/calls-for-overhaul-of-vic-timber-industry/news-story/0db91597e1b64a9a72e02e9319c23a5c

and

https://www.timberbiz.com.au/victorian-sawmillers-call-for-change-favouring-plantations/

For 200+ years forest policy in Australia has been about sawmillers (and to a lesser extent other wood processors).

Profitable tree growing has NEVER been the focus of forest policy in Australia.

It’s like having a dairy industry policy focused on cheese makers at the expense of dairy farmers.

Sawmillers need to understand.

Good forest policy isn’t about them!

Good forest policy is about the growers. It’s about profitable tree growing.

If tree growing is not profitable then sawmilling has no future.

It’s that simple.

Continually asking taxpayers for more money is not a forest industry plan.

The forest industry does not need to transition to a plantation resource.

In fact the whole idea of “transition” is completely wrong.

Transition keeps the policy focus on employing sawmillers.

That is exactly the rubbish policy focus that got us into the current disaster.

The forest industry policy needs to transition to profitable private tree growing.

That is a very significant difference!!