Cutting into the looming
New Zealand’s forestry industry is bracing itself for an onslaught of wood. Catherine Harris explores what must be done to make the most of the opportunity.
heyday returns.
Wellington-based Hamish Levack, an executive member of the Farm Forestry Owners Association, believes small players should form co-operatives, along the lines of those in Scandinavia and southern France, possibly with a view to further processing.
He says it is crucial the industry comes to some arrangement. ‘‘If forest owners all cut their trees down at 28, the cut of the small-scale forest owners would go from 4 million cum to 40 million and then drop back to 4 to 5 million a year after about six years.
‘‘I don’t think anyone thinks that would really happen, for various reasons, but even if something like it happened, it would be bad news because there would be congestion in the ports, the market would be swamped and so revenues would go down. Costs would go up because there wouldn’t be enough gangs. If the infrastructure did gear up to cope with it, then it would crash and there would be a lot of tears before bedtime for people who had invested in new machinery and stuff.
‘‘So we look at that and we say, What could be done? Well, that spike could be converted to a sustainable yield if two things were done.’’
Levack’s solution is, first, for New Zealand to aim for a sustainable yield, which means planting 20,000 hectares of trees a year between now and 2022.
This would ensure the industry would not go into a bust after the initial wall of wood has gone. Second, he says foresters must find a way to organise the cut, and to investigate more value-added ways of processing it.
‘‘The big problem is there’s half a million hectares owned by an estimated 15,000 small-scale owners and, for the most part, they don’t know who they are and there’s no co-ordination whatsoever yet. They need to be identified and engaged with and explained what their mutual advantage is.’’
Farm Forestry Owners Association president John Dermer says co-operatives are an interesting idea, but he has some reservations.
‘‘As a farmer I think we’re far too independent to go with that idea.’’
He agrees wood co-operatives in Europe have done an ‘‘incredible’’ job in handling wood flow in their countries.
‘‘But, of course, you’re asking a farmer to sit on his hands while the price is high because it’s not his turn in the queue to harvest. And that’s a pretty big ask, I think.’’
Levack disagrees, pointing to Fonterra as an example of farmer collaboration.
Stulen says the forestry industry has ‘‘the exact opposite problem of [pipfruit exporter]