Category Archives: Forestry Tasmania

Sustainable Timbers Tasmania Special Species Timbers Fiasco

Looking at the just-released 2019-20 Sustainable Timbers Tasmania Annual Report highlights the plunder and fiasco of public native forest special timbers management in Tasmania.

https://www.sttas.com.au/

On page 89 of the Annual Report is Table 16 summarising the 2019-20 production of specialty timbers from public native forest.

The bullshit around public native forestry in Tasmania is never ending.

Here I will just focus on a tiny piece of the fiasco-bullshit:

The following table shows the data from the STT annual report (page 89) summarising the annual sale of specialty timbers from the plunder of our public native forests; together with my own summary of Island Specialty Timbers (IST) annual log tender results:

Assuming the accountants and the editors have done their jobs, the IST log tender results should be a subset of the STT sales results.

https://www.islandspecialtytimbers.com.au/

Island Specialty Timbers does not produce its own separate annual report. A few years ago STT used to report highlights of the IST tender results but not anymore.

STT has reduced its annual report to nothing but marketing rubbish!

Anyway my point here is to highlight three things:

  • Most specialty timbers from harvesting public native forest are sold “off market” at “government prices” = WELFARE!!. That is 7,800 cubic metres of high value logs were given away at mates rates; and
  • Assuming that IST tenders the “very best” of the specialty timbers harvested, the other 99% of the specialty timbers harvested must be absolute rubbish!!
  • Blackwood is by far the most important special species timber, but most of it is sold “off market”.

Tasmanians are not allowed to know the cost of logging public native forest. Public native forestry is not about business.

Logging public native forest is about WELFARE and POLITICS and BULLSHIT!

Which is why so many community organisations are trying so hard to shut this industry down!

Thoughts and comments welcome!

VicForests ‘hamstrung’

https://www.gippslandtimes.com.au/story/6836029/vicforests-hamstrung/

This article appeared in a regional newspaper back in July.

Very few people would have read it. Even fewer people would have understood it or appreciated the wisdom (even if misinterpreted).

Vicforests is the State government forest agency in Victoria, Australia tasked with logging public native forests.

https://www.vicforests.com.au/

For the past 50+ years it has been the focus of increasingly bitter community opposition.

The article mostly expresses the opinions of Gary Featherston, a professional forester and apologist for public native forestry.

Mr Featherston wishes us to believe that public native forestry is “hamstrung” by its political masters.

But what Mr Featherston describes is nothing more than the chaos of politically driven public administration. Every day the objectives change according to the winds of politics. Every day the chaos increases!

The chaos of public administration is bad enough in areas like education and health. But when it comes to pseudo-commerce like public native forestry the chaos takes on a whole new meaning!

Up until the 1990’s forestry in Australia was a Government run welfare scheme. Native forest and plantations were managed to provide jobs in regional Australia.

Today only NSW and WA have Government owned plantations. Today most timber grown and sold in Australia is privately owned. Profit is the motive! As it should be!!

And yet industry and Government policy in Australia is still focused on subsidising sawmillers/wood processors; ie. Policy is still focused on welfare.

Vicforests is not “hamstrung” as Mr Featherston wants us to believe!

Vicforests (and public native forestry around Australia) is the very embodiment of 19th century ideology well past its useby date.

Vicforests can never be divorced from the chaos of politics.

Politics is the permanent enduring Achilles Heel of public native forestry.

The future of forestry is in profitable private forest managers and growers, and until Australia recognises that fact we will continue on this endless cycle of conflict, stupidity and waste.

FSC supports illegal forestry in Australia

The following constitutes my submission to SCS Global Services as part of its assessment of Sustainable Timber Tasmania for FSC Certification.

https://blackwoodgrowers.com.au/2019/04/10/public-notification/

FSC2

https://au.fsc.org/en-au

https://www.sttas.com.au/

http://www.scsglobalservices.com/

The idea that public native forestry in Tasmania is “environmentally appropriate, socially beneficial and economically viable” (FSC’s very own criteria!) is complete and utter fantasy.

Just the history of the industry over the last 5 years demonstrates the hypocrisy of this idea, never mind the forestry wars of the last 40+ years!!

The above image is taken from the Forest Stewardship Council (FSC) website. Unfortunately none of these three titles on the FSC website are live/linked. You can’t click to find out what the FSC means by “Environmentally Appropriate” or “Economically Viable”. So I typed “Economically Viable” into their search box and I got this result:

EcoVia

FSC “could not find any results”!!

I think the FSC has got some issues to resolve.

Luckily I have a clue as to what the FSC means by “economically viable” from the last time Forestry Tasmania attempted to gain FSC certification. The following quote comes from SCS Global Services website:

Can a company that operates at a loss achieve certification?

The FSC certification standard requires that a forest management entity have sufficient financial resources [taxpayer subsidies] to manage the defined forest area in conformance with the full scope of the standard.  The standard does not require that the certified forest is managed at a profit provided that other sources of working capital [taxpayer subsidies] are available and sufficient [$ billions] to enable management in conformance with the standard.

https://www.scsglobalservices.com/news/scs-responds-to-questions-about-the-forestry-tasmania-fsc-forest-management-assessment

So the FSC defines “economically viable” as pretty much anything, including major loss-making public native forestry.

The problem is, under Australian law that is ILLEGAL!!!!!!!

It’s called Competitive Neutrality, and I wrote a blog about it back in 2016:

https://blackwoodgrowers.com.au/2016/10/17/competitive-neutrality-in-forestry/

It is Tasmania’s view that all the State’s PTEs and PFEs, together with its GBEs, are significant Government businesses for the purposes of the CPA. Accordingly, in applying the competitive neutrality principles, significant Government business enterprises are defined as those enterprises which are classified as PTEs, PFEs and/or GBEs.

https://www.economicregulator.tas.gov.au/Documents/Competitive%20Neutrality%20Principles%20Guidelines%20June%201996.pdf

This includes FT/STT.

In 1995 Australia’s governments agreed to the National Competition Policy (NCP) and Related Reforms.

http://ncp.ncc.gov.au/pages/home

The problem is many of those reforms have never been implemented, or have since been watered down.

FT/STT is a classic example!

It was corporatized according to NCP policy, but it has never been run as a commercial business. And yet it competes in the marketplace against private tree growers.

FT/STT has never publically acknowledged that it is a Government business competing in the marketplace against private forest growers both here in Tasmania and on the mainland

FT/STT has never publically acknowledged the need for it to behave in a competitively neutral manner.

FT/STT has never had any Competitive Neutrality Policies and objectives…..ever!

And every week that FT/STT gets another taxpayer handout is another breach of Australia’s Trade Practices Laws.

The fact that FT/STT has never been prosecuted illustrates the broken nature of Australia’s political system, and a conflicted forest industry.

The NCP does not discuss what should be done with Government businesses that cannot survive in a commercial world, businesses like FT/STT.

The FSC does not say where these “other sources” of money may come from or place any limits on the extent of subsidisation.

I wonder what economists think of this idea?

I wonder what private forest owners who compete in the marketplace against loss-making, forest squandering Sustainable Timber Tasmania think of this idea?

So Sustainable Timber Tasmania passes the FSC “economically viable” criteria with flying colors! What a joke!!

Never mind the long suffering Tasmanian taxpayer, or the lowly paid Tasmanian public servant!

The last 20 years

Last year this article appeared in a major Australian news media site detailing the extent of commercial losses from public native forestry in Tasmania:

JL

https://www.theguardian.com/environment/2018/mar/29/tasmanian-forest-agreement-delivers-13bn-losses-in-giant-on-taxpayers

And that analysis was using FT’s own accounting methods!

If FT had to do its accounting like a private forest grower (ie. Competitive neutrality) the losses would be far greater. What private forest grower can value its entire land estate at $0.00??

No doubt the FSC would see this article as glowing praise for world class forest management!!

Greenpeace

The environmental organisation Greenpeace was one of the founding partners of the FSC. In March last year Greenpeace resigned from the FSC citing ongoing and significant issues with the way the FSC was being managed:

https://blackwoodgrowers.com.au/2018/03/30/greenpeace-leaves-the-forest-stewardship-council-fsc/

With Greenpeace gone it now seems that the FSC is moving towards becoming another forest industry rubber stamping organisation like the PEFC.

Buying FSC certified wood products does not save the world’s forests.

New Zealand

Imagine if this response on economic viability was given within a New Zealand context, where the forest industry is fully commercial and profitable?

“Yeah we just waste taxpayers money to grow trees and give them away! Who cares about farmers?”

New Zealand farmers would be marching on their Parliament House to bring down the Government!

Here in Tasmania? Not a whisper of protest!

Bunnings

Bunnings, Australia’s largest timber retailer, is threatening to stop selling public native forest products next year (2020) unless the products achieve FSC certification.

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

The marketplace is finally saying “enough is enough”!

For both Vicforests and STT this is crunch time!

Wind up

Four years ago former State politician Sue Smith called for the winding up of FT/STT. How she described the forest industry then is still the same today, but worse.

https://www.themercury.com.au/news/politics/former-mlc-sue-smith-urges-forestry-tasmania-windup/news-story/50272c2ae1798a9358999278b5563073?fbclid=IwAR2YxZMeGSksYF7eI5NxmEmnPxYe2BQ3a8vUdCmr38t1hclWC7tS3JqC-xc

How in anyone’s imagination can this agency achieve FSC certification?

Blackwood

Who is going to grow commercial blackwood when the Tasmania State government and STT waste taxpayers money giving away public native forest blackwood, supported by taxpayer subsidies and the Forest Stewardship Council?

Nothing has changed

Sustainable Timbers Tasmania does not have a business plan, nor does it have commercial objectives.

Neither does it apologise every year for its continuing waste of Tasmanian taxpayers money.

“This is the number of teachers and nurses you missed out on this year thanks to our activities. But don’t worry! We are sustainable!!”

Nothing has changed.

But from my perspective it is the failed economics of public native forestry that is the primary reason that Tasmania will never have a Tasmanian Blackwood Growers Cooperative.

If the FSC “Economic Viability” criteria are so easy to achieve, one must assume the other two criteria – “Environmentally Appropriate” and “Socially Beneficial” – are just a walk in the park!

As a forester I believe this is about the worst possible outcome for the forest industry. It is certainly the worst possible outcome for the Tasmanian community.

  1. And finally, who gets to pay for STT’s FSC assessment? That’s right! The long suffering Tasmanian taxpayer. Show me a private forest grower who has their FSC assessment paid for by the taxpayer. Answer! NONE!!

PPS. STT is just the forest manager. The State Government owns the forests! The same State Government that wants to log the Tasmanian Wilderness World Heritage Area. The same State Government that IS logging ancient rainforests in Conservation Reserves. For the FSC to certify STT would be an even bigger act of hypocrisy than that of the Tasmanian State Government. The Tasmanian Government determines Forest Policy NOT Sustainable Timbers Tasmania!!

When will Tasmania get a real forest industry based on profitable private tree growers?

Public Notification

To:          Interested Parties

From:    SCS Global Services

Date:     8 April 2019

Re:         Notification of Planned FSC Certification Evaluation of Sustainable Timber Tasmania

Summary:  As part of an upcoming Forest Stewardship Council™ (FSC®) certification evaluation, SCS is currently seeking stakeholder input regarding the forest management program and practices of Sustainable Timber Tasmania.  Please comment via email or contact our offices (contact information below).

In pursuit of Forest Stewardship Council (FSC) endorsed forest management certification, Sustainable Timber Tasmania will be undergoing an audit on the full weeks of 20 and 27 May 2019.  The audit will be conducted by SCS Global Services, a FSC-accredited certification body. The Forest Stewardship Council is a non-profit organization devoted to encouraging the responsible management of the world’s forests. FSC sets standards that ensure forestry is practiced in an environmentally responsible, socially beneficial, and economically viable way.

Sustainable Timber Tasmania (STT) is a Tasmanian Government Business Enterprise responsible for sustainably managing  public production forest (Permanent Timber Production Zone land) and undertaking forest operations for the production and sale of forest products from these forests.

The 812 000 ha PTPZ land is approximately 12% of the Tasmanian land area. PTPZ land includes 375,000 ha of native forest that is available for wood production. It also includes 120,000 ha that contributes to Tasmania’s Comprehensive, Adequate and Representative Reserve system and a further 200,000 ha of non-production forest. STT manages 28,000 ha of plantation, comprising both hardwood eucalypts and softwood.

STT is seeking FSC certification for approximately 713,000 ha, the remaining PTPZ land area is managed either by third parties or is not eligible for FSC Forest Management certification due to its plantation conversion history.

Scope and Certification Evaluation Process

SCS Global Services (SCS), a FSC-accredited certification body based in California, will conduct this FSC Main Evaluation.

Performance will be evaluated against the The FSC National Forest Stewardship Standard of Australia (v1-0; 2018).  A copy of the standard is attached to this message.

The evaluation process includes the following components:

  • Public notification: distribution of the standard and solicitation of comments on the certification applicant; Audit planning and document review;
  • Field assessment: A representative sample of field sites and operations within the defined forest area are inspected by a team of auditors;
  • Stakeholder consultation is carried out prior to and during the field assessment;
  • Synthesis of findings: conformity to the standard is ascertained and the certification decision is formulated;
  • Reporting: a draft report describing the evaluation process, findings, and certification decision is produced;
  • Peer review: the draft evaluation report is peer reviewed by 2 independent natural resource professionals;
  • Finalization of the report and conveyance to the SCS Certification Committee for the final certification decision;
  • Certification decision: the final report and certification decision is conveyed to the applicant; a public summary of the certification report is released if certification is awarded.

Call for Public Participation

SCS is seeking comments on the forest management of Sustainable Timber Tasmania or other topics pertinent to their seeking FSC certification, such as whether Sustainable Timber Tasmania complies with the legal, social, technical, and environmental requirements of the standard or identification of high conservation value forests[1] within its managed lands.  Comments can be submitted via email to FSCConsultation@scsglobalservices.com, standard mail, or facsimile. All comments and sources will be kept in strict confidence at the request of the commenter.  Also, please feel welcome to forward this message on to other stakeholders that you think may have an interest in sharing their perspective on this assessment.

Date of the Evaluation

The field evaluation is scheduled to start 20 May 2019.  When possible, SCS will make arrangements to meet with interested parties during the evaluation if appropriate, but it is preferred that comments are submitted before the field evaluation commences.

Dispute Resolution Procedure

As provided by the FSC Interim Dispute Resolution Protocol and the SCS Forest Conservation Program Quality Manual, dispute resolution procedures are in place and available to interested parties at http://www.scsglobalservices.com/your-feedback.

Additional Information

More information about FSC and SCS can be obtained from www.fsc.org and www.SCSglobalServices.com. Information about Sustainable Timber Tasmania can be found athttps://www.sttas.com.au/.

Please Contact Us
Robert Hrubes Brendan Grady
FSC Lead Auditor SCS Director of Forest Management
2000 Powell St, Suite 600; Emeryville CA 94608, USA
Tel +1 (510)452-8034, Fax +1 (510) 452-6882
FSCConsultation@scsglobalservices.com

.  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  

Evan Poirson | Program Associate, Forest Management Certification

Another blackwood timber price list

Here’s a blackwood timber price list for a timber retailer in Tasmania.

This sawmiller/retailer specialises in Tasmanian “specialty timbers”.

These timbers obviously come from Tasmanian public native forest, which as everyone should know by now, comes to market at great cost to Tasmanian taxpayers and the plundering of the last of our oldgrowth and rainforest.

https://www.theguardian.com/environment/2018/mar/29/tasmanian-forest-agreement-delivers-13bn-losses-in-giant-on-taxpayers

These prices are for individually priced boards, kiln dried and dressed, select grade (ie. Knot-free plain grain).

I’ve sorted these boards by the wood volume per metre, which seems to provide the best (but by no means perfect) explanation for the variation in price. The other curiosity besides the odd pricing structure is the diverse range of dimensions.

Note the variation in price for the boards of the same dimension eg. 310 x 32mm.

Given that timber is sold in Australia just on a price and NOT price per m or price per cubic metre, most customers would not spot this fraudulent behaviour.

Buyer beware!

ZXSJT

That this sawmiller is getting away with selling select grade blackwood for $8,000 per cubic metre should get some tongues wagging (I hope!).

The fact that getting this timber to market costs Tasmanian taxpayers is the criminal aspect of all this. Welcome to the Tasmanian forest industry!

Tasmanian Regional Forest Agreement (RFA) delivers $1.3bn losses in ‘giant fraud’ on taxpayers

logging2

This is an excellent rewrite of John Lawrence’s article from last December now published in The Guardian.

https://www.theguardian.com/environment/2018/mar/29/tasmanian-forest-agreement-delivers-13bn-losses-in-giant-on-taxpayers

Giant Fraud is an understatement!

Tasmanian’s have been completely swindled!!

That’s a $billion dollars that should have gone to our struggling schools and hospitals, not the forest industry.

So now the RFA has been renewed and Tasmanian’s will be swindled for another 20 years.

Veteran journalist Gregg Borschmann has been writing a veritable broadside of scathing articles about public native forestry in Australia. They are all worth reading:

https://www.theguardian.com/profile/gregg-borschmann

Death Certificate

Logging

Anyone reading these two recent articles by finance commentator John Lawrence would wonder if there is anyone in Tasmanian politics or public forest administration with any intelligence or integrity.

What an extraordinary tale of corruption, incompetence and waste.

Forestry Tasmania’s demise in detail

And

Forestry Tasmania’s final report

“total government (cash) assistance to the (Tasmanian) forestry industry (including Forestry Tasmania) is $1.4 billion over the past 20 years”!!!

Let me type that again:

$1.4 billion over the past 20 years!!!!

That is an average $70 million per year in cash subsidies for 20 years to the Tasmanian forest industry.

WHAT AN INCREDIBLE WASTE!

John Lawrence has been analysing and reporting on the economics of public forest administration in Tasmania since 2009. He knows the details better than anyone.

http://tasfintalk.blogspot.com.au/search/label/Forestry%20Tasmania

Anyone who has a business dependent on Tasmanian timbers from public forests is on short notice.

Your days are numbered!

These two documents should be the Death Certificate of the public native forest industry in Tasmania.

As a forester I find it very difficult.

Special Timbers Welfare State

TSSMP

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.

IST Tender Results 2016-17

ist

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/

IST2017pricechart

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.

IST Blackwood Log Tender Results 2016-17

1617logs

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 2016-17 financial year.

http://www.islandspecialtytimbers.com.au

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

During the year 20 blackood lots, totalling 20.4 cubic metres, were put to tender over 5 of the 8 tenders held by IST. That equates to 1 single truck load of blackwood material! Of the 20 lots put to tender only 6 were sold, totalling 7.2 cubic metres!

It’s been a quiet year for the local blackwood market.

Last year (2015-16) Forestry Tasmania sold 9,580 cubic metres of blackwood logs and craftwood, with the vast bulk of this volume sold on private long term sales contracts. The tiny volume sold through public tender by IST represents just 0.07% of the blackwood harvested from the Tasmania’s public native forest.

http://www.forestrytas.com.au/about-us/publications

For the August and September 2016 tenders IST put to tender 7 lots comprising pairs of blackwood logs. In the August tender the pairs were logs cut from single trees, whilst in the September tender the pairs were from different trees. All were plain grain logs. Only 2 of the pairs from the August tender sold.

None of the 11 blackwood lots from the September and November 2016 tenders sold!

Then came the March 2017 tender where 2 large blackwood logs from the same tree featuring tear drop grain were put to tender. Total volume for these two logs was 2.59 cubic metres. The larger butt log went for $1575 per cubic metre whilst the smaller head log sold for $1625. Total value for this single blackwood tree totalled $4130!! These logs provided the highlight in an otherwise quiet year.

Actually despite the low volumes sold plain grain blackwood logs didn’t do so bad. The 4 plain grain lots that sold averaged $418 per cubic metre for some reasonable quality logs, with prices up to $550 per cubic metre. I regard that as a good price.

The table below summarises the IST blackwood tender results for the 2016-17 financial year:

IST 2017 BWD summary table

The 20.4 cubic metres of blackwood put to tender compares with the total of 166 cubic metres of specialty timbers that IST put to tender in 2016-17, or only 12% of the total volume. This is despite the fact that blackwood is by far the dominant specialty timber harvested in Tasmania.

The chart below shows the average blackwood tender prices and total volumes for the past 4 years.

IST BWD pricevolume trend

Unfortunately the volume of IST blackwood tender material is too small and the quality too variable to allow meaningful market/price comparisons between years. Also IST generally only caters to the local southern Tasmanian craftwood market.

Large volumes of large, good quality logs from blackwood plantations should generally command better prices than shown by the IST result.

The blackwood market desperately needs more tradability, more transparency and more commercial credibility.

The only basis for a successful forest industry is profitable tree growers within a competitive, transparent marketplace.

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 $86! No private blackwood grower received any taxpayer subsidy.
  3. 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).
  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. 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. One of the authors of this report was none other than the Director of Forestry Tasmania!

For previous years IST tender reviews see:

https://blackwoodgrowers.com.au/2016/06/23/ist-blackwood-log-tender-results-2015-16/

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/