Prime sawmill deal eases Gisborne woes
A LIFELINE IS BEING THROWN TO SOME OF THE 100 WORKERS who may lose their jobs at the Juken NZ mill in Gisborne.
Up to 60 new jobs are to be created at the Prime Wood Processing Centre of Excellence following the sale of the Prime Sawmill by Activate Tairawhiti and Eastland Community Trust to New Zealandowned Far East Sawmills
And Far East Sawmills says it is already in direct discussions with Juken over staff recruitment for its new venture.
Juken is looking to make changes at the mill in Matawhero, just outside Gisborne, so that it can shift from producing plywood and structural LVL building products for the shrinking Japanese market to make higher value clearwood products from pruned logs that will be used for high-end residential and commercial interior cabinetry, furniture, solid doors and feature walls. Such a move would mean halving the 200-strong workforce.
While the announcement jolted the forestry community on the East Coast, the news about the Prime deal softened the expected blow
Eastland Community Trust Chairman, Michael Muir, says the sale signals a new era for the Prime site, which it took over in 2015, following a decision by Winstone Pulp International to close the mill in 2010.
Mr Muir says: “We are delighted to welcome Far East Sawmills to Tairawhiti. We’re thrilled to have such a respected operator on-site and that we can go some way to saving local jobs.
“This is a massive win for our community. And it must be said – there is no way we could have done this without the foresight of the community in establishing the Eastland Community Trust with a mandate to focus on the region’s economic growth.”
Eastland Community Trust CEO, Gavin Murphy, agreed stating: “The region should be proud it has the resources to deliver these sorts of results.”
Far East Sawmills is a subsidiary of Spectrum and is a fully integrated forest products business. The company owns the Tregoweth Sawmill in Te Kuiti, forests in Northland, a forestry harvesting company and a transport fleet. Managing Director, Wade Glass, considers the investment in Prime and the Tairawhiti region a strategic one, citing log supply, skilled labour and a proactive business network as contributing to their decision.
He says: “We’re excited to enter a region with such a supportive and well-resourced economic development capability. We’re optimistic that our proposed improvements to the mill will result in a sustainable business and employment for locals.”
The company intends to produce around 60,000 m3 of timber per annum and will likely invest a further $9 million in the sawmill, initially upgrading ageing technology to improve efficiencies. Ultimately, Mr Glass says it is the company’s goal to run multiple shifts, which could see up to 100 staff employed, although it will initially need between 50 and 60 people.
Far East Sawmills will be replicating the product mix from its existing mill in Te Kuiti, targeting high-value appearance grade lumber for export to European and USA markets. It will also partner with secondary processors who intend to incorporate their processing into, or adjacent to, the mill site in Gisborne.
Though the sawmill itself is sold, Eastland Community Trust still retains ownership of all the land (22 hectares) and can now move forward with its phased masterplan, unlocking further jobs on site and improving the value of the region’s forestry stocks.
Activate Tairawhiti Chairman, John Rae, confirmed that it is in advanced discussions with a second wood processor interested in establishing its business at Prime. He says securing an operator for the sawmill will now fast-track those conversations and, he expects, others.
This is the second investment at the Prime site, with the Wood Engineering business currently employing 15 staff and working to prove its technology.
“Until ECT and Activate Tairawhiti got involved, Prime lay dormant,” says Mr Rae. “But, thanks to the hard work of our team and the contractors on site over the past 18 months, we are continuing to realise the potential of the wood processing centre of excellence as a strategic community asset.”