ASH's Heyfield Mill closure brought forward
Burnie likely choice for new operational site
AUSTRALIAN SUSTAINABLE Hardwood's Heyfield mill will close earlier than expected. In fact, the close-down could start as soon as August.
Then, it's only a matter of time before the next phase in the major timber processor's journey takes shape in the northern Tasmanian port city of Burnie.
The Hermal Group, owners of ASH, said the "forced closure of the mill will begin sooner than initially announced due to VicForests expected short supply of logs to the mill again this year".
"While there are business and commercial issues around this failure by VicForests, the owners do note that VicForests has suffered losses of significant numbers of harvesting areas this year due to continued application of Leadbeater’s Possum exclusion zones. VicForests will have now failed to meet its contractual timber supply arrangements for 4 out of the last 5 years," the official statement said.
The Heyfield mill is one of the world innovators in product development and waste recovery.
The mill owners had been working with the CSIRO on wood waste fuel paste development with the intention of initially building a highly efficient 5 megawatt scalable carbon neutral electricity generator at the site, as a National Demonstrator Operational Facility.
The owners said they had looked at all options to keep the mill open including less commercial options such as giving the Government more time to work through its internal issues by accepting the 80,000 cubes offer in the first seven months of the 2017-18 year, however, this was rejected by the Victorian Government.
Distressed about the Andrews Government forced closured of the mill and especially about the 250 staff who will no longer have jobs.
– company statement
The owners have also looked at importing sustainable plantation logs from Tasmania and Ash species from Chile but, sadly, none were able to be progressed.
The company said it was distressed about the Andrews Government forced closured of the mill and especially about their 250 staff who will no longer have jobs, and the thousands of Victorian families, who will be adversely affected by the closure of this profitable and well managed business.
They commend the CFMEU for their significant efforts to have Mr Andrews and his Government see basic common sense and keep people in work.
The company said that since January this year they had seen many public comments by members of the Andrews Government including the Premier himself. "With the breach of the Agreement by the Government to allow the owners of the mill to advise their staff in March this year of the mill’s forced closure ahead of public comment, together with a media announced offer to buy the business, the owners have lost trust in the Andrews Government.
"No fair commercial offer has been forthcoming from the Andrews Government and any suggestions that there has been any form of intense discussions or negotiations of any form with the Government are simply wrong," the company claimed.
"Despite Daniel Andrews’ statements to the media earlier this year, it is now clear that his Government were neither serious about making a genuine offer for the mill nor were they ever serious about addressing either the supply level and contract tenure needed to operate this profitable high class facility. These political games by the Andrews Government has done nothing but make staff at the mill even more anxious. "
Closure of the mill will now begin in August.
The Victorian Government maintains it has done all it can to keep the mill operating and claimed that the job losses were both unnecessary and avoidable.
"The Andrews Labor Government has provided a fair and reasonable offer to the Hermal Group, which would keep the Mill open and secure local jobs. This offer remains on the table," according Government spokesperson.
"We call upon the Hermal Group to continue engaging with the Government so we can secure the future of the mill and protect its jobs," said the spokesperson.
According to sources, the Government's offer of more than $20 million was based on multiple independent assessments of the business and standard commercial valuation benchmarks.
However, the company said the offer fell well short of its true value.
James Lantry, spokesperson for the Hermal Group, acknowledged that there had been negotiations with the Tasmanian Government and that Burnie was the most logical site to re-establish. "Logistically, supply, workforce and port availability, it's the most logical site," he said.
Mr Lantry said initial discussions had ticked the boxes when it came to the availability and usability of plantation nitens in Tasmania.
He said there was still "an enormous amount to be worked through" before the final investment decision is made.
"We certainly wouldn't have a plant operating within 12 months from the time of an investment decision. However, you would want to be in production -- for commercial reasons with the wind-down of our Ash facility -- you would want to be in production after a final investment decision within an 18 month period.
"Two years investment and investigation into making nitens work should give some indication of our level of motivation," he said.
Despite talk of a Tasmanian move, the CFMEU maintains there is still hope for the Heyfield Mill.
According to Jane Calvert (National President of the CFMEU Forestry, Furnishing, Building Products and Manufacturing Division) the union will leave no stone unturned to make sure this mill stays open for the workers and the community.
"The union understands that discussions between the Government and the company have not reached a conclusion, and we believe the company’s statement to be premature.
"We will continue to meet with the Government and the company to try and secure a future for Heyfield," she said.
The union understands that discussions between the Government and the company have not reached a conclusion, and we believe the company’s statement to be premature. – CFMEU
From the country to the city .... workers took their grievances directly to the seat of government in Melbourne.