Monthly Archives: July 2019

Tasmanian forest industry – at long last something positive!

PFT_forum

It is a rare treat to be able to write something positive about the forest industry in Tasmania.

It may be only a tiny step along the road to commercial and social redemption but I’ll cheer nevertheless!

On the 3rd of July 2019 Private Forests Tasmania (PFT) organised an industry forum to help generate some positive media and momentum, not to mention communication.

A summary of the forum is now posted on the PFT website:

https://www.pft.tas.gov.au/home/home_articles/summary_of_private_forestry_forum2

The summary of the forum is hardly enough to get anyone out of their seats with excitement, but the general tenor of the discussion gives me a small dose of hope for the future.

It seems most/all of the discussion was about commodity wood, with little discussion about high value wood like blackwood or macrocarpa.

If the forest industry wants to have a future it needs to spend at least half of its time and resources working out how to encourage farmers to plant trees. That job IS NOT the responsibility of governments!

History has shown that cutting down forests is easy.

History has also shown that the forest industry has never understood how to get farmers to plant and grow trees (excluding tax-avoiding and investor-robbing scams). In fact history is littered with examples of the opposite trend.

This forum may just become the first small step in the right direction.

It is a shame that the Tasmanian Farmers and Graziers Association (TFGA) wasn’t present. The TFGA would be a useful ally for the forest industry.

https://www.tfga.com.au/farming-enterprises/forestry

It is also a shame that Ministers and politicians can’t keep themselves away from these events.

Most Tasmanians know that as soon as politicians get involved in anything then things very quickly turn bad. The history of the forest industry in Tasmania is one of too much politics.

There have been industry forums like this before but they have been nothing more than soapboxes for politicians. Completely useless and boring to attend.

So full (Ok 8/10) credit to the forum organisers!

Can the formula be developed and extended?

Forums in the north east and the south east of the State?

Perhaps even a forest industry developed Plan that focuses on creating full and positive engagement with the Tasmanian farming community!!

Blackwoods – selecting the best trees

NZFFA BROWN

Ian Brown is a blackwood grower and co-author of Blackwood A handbook for Growers and End Users, the New Zealand bible on all things blackwood.

He has recently written a fine update on blackwood research including some new findings about clonal blackwood. It is available on Ian’s blog on the New Zealand Farm Forestry Association website (link below):

https://www.nzffa.org.nz/nzffa-member-blogs/ian-browns-blog/blackwoods—selecting-the-best-trees/

Well worth reading.

Thanks Ian!!

IST Tender Results 2018-19

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

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

https://blackwoodgrowers.com.au/2018/07/07/ist-tender-results-2017-18/

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

I began this series of articles in 2015 hoping to start a discussion in the community about forestry, log markets and prices, and the concept of profitable commercial tree growing.

I wonder if I’m succeeding?

Results

IST had a good tendering year in 2018-19 with both increasing sales and prices.

IST conducted 9 tenders during the year putting a total of 147 cubic metres of special species logs and craftwood to competitive tender, in the only transparent, competitive forest product market in Australia. Hooray for IST!!

The IST tender results for which I have data are shown in the following chart. As I’ve said previously it’s difficult to draw conclusions given the wide range in size and quality of products that IST puts to tender. Perhaps it could be said that maximum log prices seem to have increased over the last 18 months. The same can’t be said for average or minimum prices.

IST 2019 tender results

The following chart shows average sold log volume. There is a general trend of diminishing log size at IST that becomes obvious at the annual aggregate level…

Average sold log vol 2019

This year I’ve created the same charts as above but aggregated on an annual basis.

IST 2019 tender annual

2018-19 saw 147 cubic metres put to tender. 118 cubic metres were sold for total revenue of $150,860 at an average price of $1,276 per cubic metre. 29 cubic metres of sawlogs and craftwood were unsold at tender.

Standout results for 2018-19 was a 2.48 cubic metre black heart sassafras log that sold for $4,075 per cubic metre and a total price of $10,103 at the January 2019 tender!

The following chart confirms that log sizes are falling at IST, halving in the last 4 years! People are paying higher prices for smaller logs. Is this an indication of sustainability? I think not!

IST 2019 tender annual log vol

Blackwood

Log27 1018b

IST put a total of 14.7 cubic metres of blackwood logs to tender in 2018-19 of which 8.2 cubic metres sold. 4.8 cubic metres of the sold blackwood logs contained figured grain, the remaining logs were plain (straight) grain. The following chart shows annual plain grain, blackwood sawlog tender results for which I have data. These are tiny volumes in a small domestic Tasmanian market.

IST 2019 blackwood prices

The chart shows a steady increase in average tender price for plain grain blackwood sawlogs over the last three years. The average price in 2018-19 was $727/m3! Also note that good quality plain grain blackwood logs have been selling for over $800/m3 for a the last few years.

At these prices a well managed blackwood plantation is worth over $200,000 (at mill door) per ha after 30 years!

My focus is plain grain (as distinct from feature grain) sawlogs because these are equivalent to what can be grown in a well managed commercial blackwood plantation. The target blackwood plantation sawlog is pruned to over 6m height with a volume of 1.5 cubic metres, and a small end diameter (SED) of 50 – 55 cm depending upon stem taper.

The following chart shows the average volume and small end diameter of plain grain blackwood logs sold by IST at tender. These logs are equivalent in volume and SED to what can be grown in a commercial blackwood plantation.

IST 2019 blackwood vol SED

Standout blackwood results for the year were:

  1. A massive 3.1 cubic metre figured grain log that sold for $800/m3 for a total price of $2480;
  2. A 1.5 cubic metre plain grain log that sold for $800/m3 for a total price of $1200. This log measured 5.5m length, 52cm SED 75cm LED. This is equivalent to a target blackwood plantation log.

Given that blackwood comprises 95+% of all special species harvested from public native forest, IST tenders very little blackwood.

Tasmanian blackwood (Acacia melanoxylon) is the only special species product sold by IST for which this market data has any real relevance. Unlike the other species that IST sells, blackwood can be grown commercially in plantations. The Tasmanian Government is doing all it can to discourage landowners from growing commercial blackwood!

IST Price Archive

IST’s price archive table (see below) is out of date, as the above chart indicates.

IST blackwood price summary

Good quality plain grain blackwood logs are selling for >$800/m3.

As for short, plain grain logs here’s a chart showing the relationship between price and log length for the last 5+ years. Good luck if you can see any trend in that. I see short plain grain blackwood logs going for very good prices!

PriceVSlength

Blackwood logs with feature grain (birds-eye, fiddle-back, etc) can range between $200 and $2,900 / m3 depending upon the size of the log and the presence of other defects.

Caveats

  • These tender prices are effectively mill door prices that already include harvesting and transport costs. They are NOT stumpage prices.
  • Island Specialty Timbers (IST) is an enterprise of Forestry Tasmania Sustainable Timbers Tasmania established in 1992 to increase the recovery, availability and value of specialty timbers from harvesting activities in State forests.
  • Forestry Tasmania Sustainable Timbers Tasmania manages its special timbers operations (including IST) as a taxpayer-funded, non-commercial, non-profit, community service. Each cubic metre of blackwood log harvested by Forestry Tasmania received a taxpayer subsidy of $90! No private blackwood grower received any taxpayer subsidy.
  • Note that all logs and wood sold by IST come from the harvesting of public native old-growth forest and rainforest certified under AFS (PEFC).
  • It is unlikely that this tiny set of market-based blackwood log prices is representative of the broader blackwood market.

Indian Rosewood

And speaking of prices I must include my story from April about the record Indian Rosewood log price:

https://blackwoodgrowers.com.au/2019/04/15/rosewood-log-gets-record-price/

Assuming this is a plain grain rosewood log it is an extraordinary price of $AUD14,400 per cubic metre!