Category Archives: Markets

An invitation to join the Forest Stewardship Council (FSC)

HI Gordon,

I’ve been reading your newsletter. Have you thought about joining your group up to FSC?

I’m in the environment chamber and on the board. Happy to talk about it if you are interested.

Cheers

I recently received this invitation to join the Australian branch of the FSC.

I’m making my reply to this invitation public because I believe the public and the marketplace need to better understand what is happening within the forest industry.

Hi XXXX

Thanks for the invitation for the Tasmanian Blackwood Growers Cooperative to join the FSC.

Twenty years ago I had hopes that the advent of the FSC would see major reform within the Australian forest industry.

Today I have no such illusions!

The fact that Bunnings/Officeworks will help shut down public native welfare forestry next year is indirectly due to the FSC, but otherwise the industry and the wood marketplace are utterly moribund.

Harsh words I know, but after a 40 year career that is the only conclusion I can come too.

The FSCs standards for “economically viable” are a joke. No they are worse than a joke! They are completely offensive and destructive to the future of the industry:.  

https://blackwoodgrowers.com.au/2019/05/13/fsc-supports-illegal-forestry-in-australia/

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

Because of this “Standard”, private forest growers have no hope. Because of this “Standard” my Group has no future. How can it when annual taxpayer subsidies to public native welfare forestry are fully supported by the FSC and PEFC? Private growers don’t get FSC/PEFC approved annual taxpayer subsidies!!

Growing trees for wood production is a commercial activity. It is not welfare!

Should I join the FSC to help drive change within the FSC?

If Greenpeace resigned because it could not achieve meaningful change within the FSC what chance would I have of doing so?

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

Greenpeace is right! Third party certification without transparency is a waste of time. It becomes a form-filling, label-sticking exercise of little value.

So why would I join an organisation like the FSC that deliberately seeks to undermine private forest growers?

Taxpayer subsidised welfare forestry and profit-driven commercial forestry cannot coexist in the same marketplace.

It’s that simple!

The FSC supports welfare forestry and therefore undermines commercial forestry.

It’s that simple!

If the FSC wants to support and encourage farm forestry in Australia then it needs to change its assessment standards.

It’s that simple!

Yours sincerely,

Gordon Bradbury

Timber processor alarmed over ‘massive amount’ of softwood exported to China

A large truck carrying neatly piled wood logs enters a large yard with thousands of large wooden logs.

https://www.abc.net.au/news/2020-09-02/softwood-resource-exported-to-china-amid-log-supply-insecurity/12617994

Here we are. Sawmillers who have spent generations being on the Government payroll are now complaining about having to exist in a global competitive market.

With the sale of Government pine plantations, the new plantation owners are free to sell their logs to whoever they like, including customers who are prepared to pay more than domestic customers/sawmillers.

Imagine that! Competition and free trade in the forest industry. Who would have guessed?

This is a classic forest industry sob story, about poor hard-done-by sawmillers who can’t compete in a global marketplace.

The softwood industry is no longer part of the Welfare Forestry System in Australia, except in Western Australia and New South Wales, where Governments have yet to privatise their plantation estates.

I just love the pity-me language:

Our forefathers planted the trees — they were planted with a plan to create jobs into the future. It wasn’t about growing wood for Asia.”

A classic example of Trees-as-Welfare, not Trees-as-Commerce. The idea of growing trees to make a profit is anathema to these poor folk.

These sawmillers are demanding welfare not trees!

They are unwittingly demanding the destruction of their very own businesses and industry.

Clearly the Green Triangle Forest Industry Hub (GTFIH) is not the cohesive single-minded group that their website wants us to believe:

http://gtfih.com.au/

Tensions between growers and processors are running high!

The GTFIH has a plan to plant 50,000 ha of new plantation over the next 10 years. That definitely won’t happen with stories like this in the media.

Who would want to plant trees knowing you cannot trade in an open competitive market? Nobody that’s who!!

Unfortunately the article does not talk about prices and markets, or any idea of the growers side of the story.

And as for an industry Code of Conduct, that would be the final nail in the coffin for the already struggling forest industry in Australia.

What other primary producers in Australia face a more hostile political environment than tree growers? I can’t think of any! Happy to have your comments!

Anyone growing trees for wood production in Australia, whether plantation or native forest, should be very worried right now. Your investment is about to be destroyed by your politicians.

What a total mess the industry is!!

A proposal to develop New Zealand’s alternative, specialty timbers industry

cropped-p26-nicholas-presentation-blackwood-2011m.jpg

https://fgr.nz/2020/07/14/survey-a-proposed-industry-association-for-alternative-specialty-timbers-and-small-scale-sawmillers/

This sounds exciting!

As usual the New Zealand forest industry is generations ahead of anything happening here in Australia.

This new proposal to establish a NZ Specialty Timbers Association is just brilliant.

Unlike specialty timbers in Tasmania, the industry in NZ has nothing to do with plundering public native forests, or endless, repetitive political games.

New Zealand’s specialty timbers are farm-grown, and include plantations and managed native forest.

A discussion paper about the proposal is available from the above website. It is only 5 pages and well worth reading.

One of the interesting aspects of the proposal is the key role which portable sawmillers will play in the Association; providing the vital link between the marketplace and the thousands of specialty timbers growers in New Zealand.

The current focus of the discussion paper is on the NZ domestic markets which is fine. There are plenty of opportunities locally. But there are a few specialty species (incl. Blackwood) for which available volumes are already in excess of domestic demand, so that export markets must be developed immediately.

Two aspects that I believe are vital for the new Association to consider:

  1. An Industry Plan is needed, with objective, measurable goals and regular reviews. Having thousands of farmers randomly planting thousands of different timber species with no vision or coordination, will not build a viable future. The marketplace needs to develop a select list of preferred species, so that viable marketable quantities of quality wood from these species are available to the market.
  2. Lots of marketplace support and feedback, from builders, architects, craftspeople, etc., needs to be generated so that farmers can have a sense of what they are doing and why. Currently the marketplace completely avoids thinking 10, 20, 30 years into the future when it comes to timber supply. This must change!!

I will follow this story as it develops over the coming months and years.

Congratulations New Zealand!

You have done it again!!

A Change of Policy

BunningsBlockade

Having spent decades/generations complaining about protesting and blockading “greenies” in the public forests, and demanding legal and political protection from such activity, it seems the forest industry in Australia now openly supports a citizen’s right to protest and blockade.

https://www.abc.net.au/news/2020-07-22/bunnings-logging-protest-after-ditching-victorian-timber/12479914?fbclid=IwAR1HFW46QenXcPH6egLqbAWwTMZZN3EAuVmatbi8wao16Q1ANP9d2fQGOPg

Who would have guessed that such a dramatic change in industry policy was possible?

https://www.theguardian.com/australia-news/2020/feb/21/tasmanian-anti-logging-protesters-banned-from-forests-over-unsafe-behaviour

Even politicians who have been champions of “lock up the protestors”, have changed their spots and are preparing to chain themselves to the nearest Bunnings charity barbeque.

Will that be white or wholemeal bread with your sausage Maam? Onions? Sauce or mustard? I hope your chains are comfortable Maam! Can I get you a seat?

https://www.theadvocate.com.au/story/6846846/will-braddon-mp-hit-a-bunnings-jail-snag/?cs=12&fbclid=IwAR3yr7tdPMtrABF2Xz02fMTJODND20qQU8gf87ZpGo5buZuXeUQUcYfDK80

It’s not a good look for the forest industry. Bunnings Hardware is stepping out courageously and developing a social conscience, and the forest industry is demanding that they stop!!

I’m not going to mention the “H” word because people get offended by that kind of language. Instead I’m giving these people the benefit of the doubt and assume the forest industry is now a champion of freedom and democracy. The right to protest is a fundamental cornerstone of democracy….even when you are on the receiving end of the protest!

From now on the forest industry will welcome protestors to the public forests with open arms, divided by values but brothers and sisters in freedom and democracy!

And we will hear no more rubbish about Anti-Protest Laws in Australia from either the forest industry or politicians, otherwise I will be forced to use the “H” word!!

It’s a New Age!!

More industry-destroying salvage timber

Whilst wandering around the internet I came across some more Australian salvage timber prices that are completely outrageous!

Once again this is farm salvage macrocarpa cypress.

But these prices are beyond ridiculous.

These prices are total destructive of farm forestry and the greater forest industry.

“Structural” grade macrocarpa timber for $800 per cubic metre???

Even the seriously large sizes are the same cheap price.

These prices are for lengths up to 4.2 metres. Pay 20% extra for lengths of 4.2-4.9m, 30% extra for lengths of 5-5.9m, 40% extra for lengths of 6-6.5m.

Madd

This sawmiller’s motto is “quality timber at affordable prices”!!

More like “premium timber at give-away prices” buy now before it’s all gone!!

This sawmiller obviously believes he’s doing a good job helping farmers get rid of unwanted trees and turning them into something useful.

Instead they are guaranteeing that no one will have premium timber in the future!

When I made this chart up, I had to go back and check my figures to make sure I was doing it right. I could not believe what I was seeing.

No farmer is going to bother growing cypress (or any tree) for wood production when its “sold” on the market at these prices.

If the forest industry wants a future; if the marketplace wants to have premium wood in 20, 30 years time, then this nonsense must stop!!

This kind of pricing destroys your future!

https://blackwoodgrowers.com.au/2020/06/13/salvage-timber-markets-and-their-destructive-impact-on-the-forest-industry/

IST Tender Results 2019-20

IST 1219 log35b

Well I’m sure we can all agree. It definitely hasn’t been your average year!

Island Specialty Timbers (IST), the only source of open, competitive, transparent market blackwood log prices, managed to conduct 6 log tenders during the year. A normal year would see 8-9 log tenders.

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

IST is a business enterprise of Sustainable Timber Tasmania (STT) which sources and retails raw material of Tasmanian specialty timbers from harvest or salvage operations conducted on State owned Permanent Timber Production Zone land (PTPZl).

You can read my previous annual tender summaries here:

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

 

Blackwood Results

Despite the fact that blackwood is by far the most common specialty wood in Tasmania, IST insists on restricting tender sales of blackwood. Only 3 blackwood logs were put to tender this year in 2 of the 6 tenders; 3 logs out of a total of 194 logs put to tender!

That’s pretty pathetic!!

Tasmanian blackwood is the only specialty timber species that can be grown in commercial plantations. Having a plentiful supply of market information might actually stimulate investment in tree growing in Tasmania, but IST/STT and the Tasmanian Government are determined to prevent any useful market information being available.

IST/STT and the Tasmanian Government continue to support Welfare Forestry in Tasmania, instead of promoting a profitable commercial forest industry.

All 3 blackwood logs put to tender sold, 1 log had figured grain, the other 2 logs were plain grain.

All 3 logs were of good size and reasonable quality.

The figured grain blackwood log sold for $825/m3, total price $982.

The 2 plain grain blackwood logs sold for $400-$450/m3, total prices $468-$774.

The following chart shows the volume and price data for the last 6+ years for plain grain blackwood logs. Having enjoyed 4 years of steadily improving prices this year showed a subdued market.

These logs are sold into the small local Tasmanian market which restricts prices somewhat.

These prices are effectively mill door delivered, not stumpage prices.

IST 2020 blackwood prices

The following chart shows the range in size of the sold plain grain blackwood logs.

A target plantation grown blackwood log has a volume of 1.5 cubic metres and a small end diameter (SED) of approx. 50 cm.

IST 2020 blackwood vol SED

General Results

Overall IST put 112 cubic metres of specialty timbers to tender in 2019-20 of which 97 cubic metres sold for total revenue of $94,200.

Last year Sustainable Timbers Tasmania sold 9,747 cubic metres of specialty timbers, so these competitive tender sales represent a mere 1% of specialty timber sales from public forests in Tasmania.

The following chart shows the volume and price summary for all tenders back to 2015.

 

IST 2020 alltender volumes

The tiny volumes and wide variability in species and quality of logs that IST put to tender makes assessing trends over time difficult.

The next chart shows the average volume of the sold logs. Here there is a clear trend of diminishing log size. If it wasn’t for the occasional large eucalypt log IST throws into the tender mix, this trend of diminishing log size would be even more evident.

IST 2020 alltender logvol

The following 2 charts show the above data summarised by year:

IST 2020 annual volumes

What remains apparent is that the market continues to pay high prices for quality timber.

IST 2020 annual logvol

The main focus of IST tenders is black heart sassafras (Atherosperma moschatum) which can command very high prices for good logs.

https://en.wikipedia.org/wiki/Atherosperma

However the tree is slow growing (500+ years to reach commercial size) and is restricted to rainforest and old growth eucalypt forest, so supplies of this species are dwindling.

Surprisingly the marketplace continues to support the plundering of Tasmania’s last ancient forests!

For 2019-20 black heart sassafras made up 37% of sold volume and 52% of tender revenue, whilst eucalypt feature grain logs made up 22% of sold volume and 9% of tender revenue.

6.7 cubic metres of celery top pine logs (Phyllocladus aspleniifolius) were sold at an average price of $1,050 per cubic metre.

Overall highlights for the year were $4,975 per cubic metre paid for a small musk (Olearia argophylla) log; whilst a total price of $2,933 was paid for a medium sized black heart sassafras log.

Bunnings stops selling timber logged by VicForests after court ruling

Bunnings

https://www.theguardian.com/environment/2020/jul/01/bunnings-stops-selling-timber-logged-vicforests-court-ruling

HOORAY!!

Bunnings, Australia’s largest hardware chain and retailer of public native forest products, has brought forward its decision to end the sale of Vicforest products by 6 months.

Back in May the Federal Court ruled that Vicforests was in breach of Australia’s environmental laws. It’s not the first time Vicforests has been in court, so Bunnings has decided enough is enough!

https://www.theguardian.com/environment/2020/may/27/vicforests-breached-forestry-agreement-with-central-highlands-logging-court-rules

The first domino in the marketplace has fallen. The pressure will now mount in the marketplace for other businesses to follow Bunnings example.

The end of WELFARE FORESTRY in Australia is in sight.

Wesfarmers/Bunnings/Officeworks policy is to only sell FSC certified timber products come the 1st January 2021:

https://sustainability.wesfarmers.com.au/our-principles/sourcing/suppliers/

Now Vicforests, then Sustainable Timbers Tasmania will no longer enjoy Bunnings support come December.

Bunnings are to be congratulated on having a social conscience and sticking to it!

Made my day!!

Salvage Timber Markets and their Destructive Impact on the Forest Industry

If we had a real forest industry in Australia and properly functioning timber markets then salvage timber would be just another option in the marketplace. But neither of these conditions applies.

Australia does NOT have a real forest industry NOR does it have proper functioning timber markets.

So when I go to buy macrocarpa cypress timber for a project and pay a price that is ridiculously cheap I realise that, as a consumer, I am helping to destroy the forest industry that I am so passionate about.

The chart below shows the price list for green macrocarpa from the retailer I went to.

The chart shows that regardless what size timber you buy, you are paying the same very low price by volume.

This is salvage macrocarpa from old farm trees around Tasmania. The quality of the salvage timber is variable. But good quality macrocarpa is a premium timber.

Macrocarpa

Cypress is also an ideal farm forestry tree as New Zealand farmers are well aware. It is quick growing, easy to grow on a wide range of sites, and produces a premium timber.

https://www.nzffa.org.nz/farm-forestry-model/species/cypress/

But I know of only 4 farmers in Tasmania who are growing macrocarpa in small plantations.

This is despite the fact that the timber is in high demand.

So when sawmillers and log traders buy old farm trees and pay next-to-nothing for them, and timber retailers sell the timber for bargain prices, who gets the message that demand and prices are high? What farmers are going to invest in growing this premium timber when the marketplace fails as it clearly is?

If I had to pay the real (replacement) cost of growing this wood, plus a premium for the fact that I am buying a premium product, I would expect to pay MUCH MORE than $2,780 per cubic metre.

Never mind that the price list shows no price premium for large sizes as there should be.

If it was Tasmanian oak I’d be paying over $10,000 per cubic metre for my pieces of timber!!

This is a typical salvage timber price list.

The price list is designed to reflect the fact that no one is deliberately growing this wood in Tasmania.

In other words the price list is designed to prevent investment in tree growing.

Tasmania could have a thriving, valuable macrocarpa industry, but it chooses not too; as if Tasmania has a super abundance of commercial opportunities from which to choose.

Sawmillers and timber merchants traditionally take no responsibility for their own future. It is someone else’s job to encourage and support tree growers.

Would any of my New Zealand readers like to share their local price of macrocarpa/cypress timber?

Within Australia I would include public native forestry within this same “salvage” category since the market price for public native forest timbers does not reflect the cost of growing the wood.

It is the responsibility of the marketplace to support and encourage tree growing otherwise there will be no timber in the future.

How do we fix timber markets in Australia so they support commercial tree growing?

How do we stop the salvage timber market from undermining the forest industry?

When will Australia get a real forest industry?

Market failure & responsibility

thelmalouise

One of the major realisations I have made over the past 10 years is the complete failure of forestry and timber markets to take any responsibility for their own future.

Here is just one recent example:

Good Day Dr. Gordon Bradbury,

Hope you can introduce some seller or loggers milling Tasmania Blackwood Logs or lumber etc,

Sir we are Hong Kong based company and looking for looking for Tasmanian Blackwood logs 40cm plus in diameter to import if possible,  1-2×40′ containers, CIF Incheon, South Korea.

Will appreciate if you could send us your complete offer with certificate (FSC/PEFC),, provide some photos for checking the quality and shape on logs, lumbers and veneers, MOq, terms of payment, terms of inspection, estimated delivery time, yard location etc.

Thank you so very much for your kind help

Kind Regards

I get regular emails and SMS messages from people wanting to get their hands on cheap blackwood.

When I try to engage these people in my quest, which is to get the market to take responsibility and support, encourage and reward Tasmanian farmers to grow quality wood for the future, I get excuses of why they cannot help!

Here is one of my standard questions I ask these people:

Q: Do you care about the future of YOUR industry/business?

A: Moan, complain, apologise, blame others, too busy, etc., etc., etc…

Is the forestry/timber market so short-sighted, corrupt and stupid that it is willing to destroy its own future?

It would appear so!!

Log traders, furniture makers, craftspeople, luthiers, cabinet makers, architects, builders, retailers, festival organisers,etc.

Every one of these professions/trades seems to have no interest in their own future.

I don’t know of any other primary industry in Australia that has such a fatalistic attitude. Every other primary industry, beef, sheep, poultry, dairy, vegetables, fruit, grain, etc. all keep their growers uptodate, supported and informed with all the relevant information they need to keep these industries running smoothly and efficiently.

Not the forestry/timber market!

Yes forestry has long investment periods and some other unique characteristics, but this means that the market has to work that much harder to ensure its future.

Having plundered the worlds forests the forestry/timber market seems determined to do a “Thelma and Louise” and accelerate over the cliff to extinction.

And for those log merchants wanting cheap blackwood, all the existing resource in Tasmania is committed. Most of it comes for public native forest for the domestic welfare forestry sector. A small amount is salvaged from private property.

Here’s another way of looking at the issue. How many companies are there in Australia and around the world that use Tasmanian blackwood timber or would like too? Dozens? Hundreds? How many of these companies actively support and encourage the growing of Tasmanian blackwood? My guess! None!! Ziltch!!

I’m happy to be proven wrong.

Very few Tasmanians are planting blackwood for the future and the major reason is the careless attitude of the marketplace. The marketplace has a death wish!!

People I speak to who are interested in planting blackwood I tell them the truth – no one wants you to grow quality blackwood timber for the future. Nobody! No one will support or encourage you. In fact many people are actively working against you!

Why commit to a 30+ year investment growing quality timber when the marketplace couldn’t care less?

ACCC suing Government Business Enterprise (GBE) over alleged anti-competitive conduct

ACCC

At long last the Australian Competition and Consumer Commission (ACCC) is taking action against anti-competitive State Government businesses.

Hooray for that!!

https://www.abc.net.au/news/2019-12-09/accc-suing-tasports-over-alleged-misuse-of-market-power/11781852

And it is in Tasmania!!

Now who would EVER imagine anti-competitive GBE behaviour in Tasmania?

https://www.accc.gov.au/

I’ve written about this issue previously as it relates to the forest industry in Tasmania, particularly public native forestry:

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

and

https://blackwoodgrowers.com.au/2019/05/13/fsc-supports-illegal-forestry-in-australia/

ACCC Chairman Mr Rod Sims said the case against Tasports was the first of its kind under the amended misuse of market power provision, an “important law reform designed to protect the competitive process and help us address the harm that anti-competitive conduct does to consumers and the Australian economy“.

Does handing out $100 millions of taxpayer dollars over decades to a failed State-owned forest enterprise, which is in direct competition with private forest growers, amount to anti-competitive behaviour?

It sure does!

Does selling 99% of your forest produce “off-market” in long-term secret sales contracts, with absolutely no competition or price transparency, amount to anti-competitive behaviour?

It sure does?

Now is the ACCC prepared to take on any more anti-competitive Government Buisness Enterprises?

I sure hope so!

Wouldn’t it be a laugh for Sustainable Timbers Tasmania to gain FSC Certification, only to then be prosecuted by the ACCC for anti-competitive behaviour?

Only in Tasmania!

Tasmania will never have a proper commercial forest industry until anti-competitive welfare forestry is stopped.