NZ forestry heading for a major crash, warns political leader
FORESTRY IN New Zealand is heading for a major crash unless immediate steps are taken to restrain the excessive exporting of raw logs, says New Zealand First.
“The growth of unprocessed log exports, mainly to China, has gotten out of control and it is destroying any chance of growth to the value added sector here in New Zealand,” said New Zealand First Leader and Northland Member of Parliament Winston Peters.
“Today we have no control, no laws, and no careful and astute management of one of our greatest resources,” he told a regional meeting of the Wood Processors and Manufacturers’ Association.
“Instead our forests are being plundered. It’s boom and bust all over again. The way things are going in coming years, exotic forests planted by people of foresight through the 1980s and early 1990s will be gone,” he told the meeting.
Mr Peters said the National Government “treats this industry is if they are spud farmers producing an annual crop; they don’t seem to realize that it takes 27 years to grow a forest”.
He said New Zealand’s forestry crisis has too many raw logs going out, and too little planting going in. The amount of replanting on existing forest land has declined.
In the last 15 years the total area of new forest area planted has plummeted from 33,674 hectares down to 3051 hectares, an approximate 90% decrease.
The collapse in carbon prices from 2008 to 2012 saw very little land being converted to forestry with the reverse occurring as conversions to pasture were made – mainly for dairy production.
“New Zealand is now clear felling and harvesting too early. Forest owners, the foreign companies, in the carbon price slump, are resorting to quick profits,” he said, and added that eight of the top 10 forest companies in New Zealand were overseas controlled.
“Other private companies and iwi are also caught up in this short term profit frenzy. Private owners are selling early to the Chinese when it would be better that their trees are tagged for harvesting in five to 10 years.
“It is true log exports are needed for our economy, especially of our lower quality product, but not at the current excessive and unsustainable rates and to the detriment of processors and sawmills.
In 2000 the amount of raw logs exported was almost 6000 cubic meters – in 2011 it was well over 11,000 and last year it was over 16,000 cubic meters.
The Wood Resource Quarterly reports New Zealand continues to be the world’s leading exporter of softwood logs followed by Russia and the US.
New Zealand, Russia and the US accounted for almost 50% of globally traded logs last year in the main going to the Chinese market. “The Wood Resource Quarterly says we are exporting over 50 per cent of our total harvest in log form.
He warned that sawmills would have to wind back or close; jobs would be lost. Log truck companies would take a big hit as well.
Since 2000 the number of log sawmilling businesses in New Zealand has dropped from 507 with over 7500 employees to 327 businesses with about 4800 employees.
Statistics last year showed Northland had 460 employed in forestry and logging; 210 in forestry support services and 650 in sawmilling and timber dressing.
Mr Peters said many of these jobs would be at risk.
“And this massive fall-off in a timber industry in crisis will continue through to 2040 because critical decisions to maintain our planting didn’t happen; that’s why we must dramatically cut back this crazy sell-off of raw logs.”
Mr Peters said that while New Zealand’s forests were being cleaned out other nations were locking up their forests.
“In the next five years China, our biggest market for logs, will fully stop the commercial harvest in their government owned forests thereby locking up 70.5 million hectares because they have overharvested.
“They will stop the commercial harvest in their collective ownership and private ownership natural forests on a step-by-step basis.
“They will establish just over 33 million hectares of new plantations.
“They have set targets for their forest industry development by 2020 which include:
China’s forest coverage rate is expected to reach 23.0%;
Forestry national forest stock volume is expected to reach 16.5 billion cubic meters
China’s forest industry output value will reach $US1.3 trillion
“While China plans in this way, they tell their local wood users to continue buying cheap timber from overseas, from places like soft old New Zealand.
“And as China does this – we have a government that has no planning and is interested only in the next quick buck that comes through the door.
“And China is not alone in looking after its own forestry industry, Canada and Chile are doing the same.
“They are acting prudently. They have a total maximum quota of logs that can be exported.
“But not in New Zealand – it’s open slather.
“It must end – we must not delay any longer dealing with this crisis – we must act before the log supply from our forests dry up.
“Forestry owners must be encouraged to replant.
“Logs should not continue to be taken across our wharves and overseas until policies to protect the local industry, processors, saw millers and workers are first put in place.
“The local industry must be assured it can access the grades of logs they require,” Mr Peters said.
He said there must be a set New Zealand domestic log price, and, like Canada, quotas must be applied.
“Foreign buyers don’t pay GST on logs – which local sawmills must do.
“The Overseas Investment office must have much tighter scrutiny of foreign investors coming to New Zealand.
“Buyers of our forests must provide real evidence to show selling to them is for the long term benefit of New Zealand.
“There has to be investment in added value New Zealand wood products.
Mr Peters said there were opportunities in New Zealand that were not being pursued.
“Northland pine is rated the best in the country for structural purposes, and with the home building crisis in Auckland, the construction industry must be encouraged to use timber.
“Again this is looking after our local industry, but to help this happen the government must play its part as well. They must impose tariffs on imported building materials not made here.”
In the 2014 Budget the government again worked against the best interests of this country and dropped the tariffs."
New Zealand First and Member of Parliament Winston Peters