WoodWeek 6 June 2018
Another aspect of climate change doesn't appear in today’s news, but it will be occupying considerable time and resources for many forest management staff on the East Coast. This time the climate change effect has come in the form of extreme rainfall following harvests. The property damage and potential for loss of life has drawn a focus on affected rural residents’ blame laid at forestry's door for the rainfall-induced logjams. There is a mismatch with the demand for immediate answers by a forceful media in contrast with the reality of the need for a thorough and methodical investigation by forest managers. More on that in coming weeks.
Now to news of a solution that shows what can be done when willing parties communicate well. China Forestry Group NZ and Waipapa Pine entered into a long-term supply agreement last week that will see jobs for Kiwis protected and economic development promoted in Northland. The agreement was signed at the Waipapa Pine sawmill in the presence of the Forestry Minister, Hon. Shane Jones.
Looking to conferences for our industry, we remind you of the upcoming Woodflow Logistics Conference series later this month. See www.woodflow.events. There are still seats left so register now so you don't miss out. In August, the Forest Safety and Technology Conference series (www.forestsafety.events) has been well- supported with people registering at Earlybird rates. This event sold out in Rotorua last time it ran – so get in early to make sure your people can register. Both conference series run in Rotorua and Melbourne.
Outside of Innovatek’s forestry focus we are also running an agriculture industry conference on the rapid rise of alternate proteins at our conferenced titled ProteinTECH. See www.proteintech.events for details.
Staying with progress and more good work on breakthroughs from our Minister of Spadework, Shane Jones, we have details of the first joint venture for Te Uru Rakau, signing with the Ngati Hine Forestry Trust to plant and manage about 3,600 hectares of pine trees in the far North.
This week we have for you:
Forest-sawmill contract secures jobsUnprecedented agreement between forest owner and local sawmill secures Northland jobs - In an unprecedented move, representatives from China Forestry Group NZ and Waipapa Pine late last week entered into a long-term supply agreement that will see jobs for Kiwis protected and economic development promoted in Northland. The agreement was signed at the Waipapa Pine sawmill in the presence of the Forestry Minister, the Hon Shane Jones.
The new agreement gives Waipapa Pine Ltd the assurance that China Forestry Group NZ will support the sawmill with stable log supply and pricing throughout 2018.
Today’s contract with Waipapa Pine Ltd is in line with China Forestry Group’s global drive to stabilise the forestry supply chain. Traditionally, sudden price fluctuations are potentially devastating to contractors at every step of the process. With more predictability in the supply chain, China Forestry Group NZ believes that the balance between supply and demand can be managed, benefiting all participants along the way.
Blueprint for future cooperation - The agreement between China Forestry Group NZ and Waipapa Pine closely ties into the New Zealand Forestry Minister’s stated strategy of wanting forest owners and domestic processors to work together on projects that add value in New Zealand and export markets.
“This Government is keen to attract high quality overseas investment that brings genuine benefits to New Zealand. I’m pleased to see the agreement that has been made between these two parties, which will ensure security of supply for Waipapa Pine and jobs for local workers.” said Mr Jones.
Waipapa Pine director Shane Horan said the stewardship being shown by China Forestry Group NZ is symbolic of the step-change many foreign investors are hoping to make in New Zealand.
“I trust this agreement will help change the perception some people have about a lack of commitment from foreign investors to adding value to production in New Zealand,” said Mr Horan. “For forestry in New Zealand to prosper, we need foreign investment, so it is vital to forge strategic relationships with the right kind of investors.”
New agreement ensures ongoing supply - The agreement between China Forestry Group NZ and Waipapa Pine secures ongoing employment for the more than 100 people who work at the company's two sites in Northland – the sawmill in Kerikeri and the timber processing plant in Whangarei.
Waipapa Pine director Shane Horan said the assurance of long-term supply benefits the sawmill, its staff and customers. “It’s also good for forestry contractors, as more sustainable harvesting provides regular employment,” said Mr Horan.
China Forestry Group NZ’s chief operating officer, Steve Walker, said his company is committed to sustaining and growing local employment in and around Northland.
“The supply agreement we have put in place today is proof of our long-term commitment to this community and this region. Hopefully, this is the start of lasting relationship between China Forestry Group NZ and Waipapa Pine.”
Te Uru Rakau/Ngati Hine joint ventureTe Uru Rakau and Ngati Hine Forestry Trust have signed a joint venture to plant and manage about 3,600 hectares of pine trees in the far North, Forestry Minister Shane Jones announced late last week.
“This marks the first joint venture negotiated under the One Billion Trees programme with Ngati Hine Forestry Trust and Te Uru Rakau (Forestry New Zealand) committed to working together on this commercial venture,” Shane Jones said.
“This will be a boost to the local economy and will provide employment opportunities and better social outcomes for the whole region. We’ll plant 500,000 pine trees this year, with a further 2 million planted over the next three years.
“In addition, up to 465 hectares of Manuka will be planted on Ngati Hine Forestry Trust land. At the end of two years a substantial commercial Manuka plantation will be in place with an apiculture business developed to help the Trust diversify its land use.
“This will provide essential work experience for young people, helping them to build a strong foundation for a forestry career. Over two years, up to forty people will participate in the training programme, developing the skills and qualifications they need to succeed.
“We’ll invest $1.9 million in the Manuka planting initiative, with the potential that the training programme developed could also be used in other regions nationwide.
“This initiative supports the Trust’s plans to establish and grow future opportunities for higher skilled and better paid jobs in Northland. It will help create economic resilience in the region and improve the quality of their land for future generations.
“The One Billion Trees programme is more than an investment in trees. It’s about providing an important investment in our people, our regional communities, and our environment,” Shane Jones said.
“It’s great news that Te Uru Rakau, and Ngati Rehia are committed to work towards a commercial forestry rights agreement following the signing of a Memorandum of Understanding between the parties,” said Shane Jones.
“Through the Provincial Growth Fund, we’ll also invest $288,000 to explore the establishment of a kauri sanctuary – free from kauri dieback – on about 45 hectares of sheltered Ngati Rehia land.
“This is another example of this Government pursuing genuine partnerships to support Maori economic development."
CSIRO: New climate change tool for forestersPredict forestry climate change with the click of a mouse with new tool - Forest managers will be able to gauge the likely effect of climate change on growing conditions in their specific areas with a new interactive online tool developed by the CSIRO with funding from Forest & Wood Products Australia.
The free Forest Climate Risk Tool provides information on factors such as the likely periods of drought, rainfall, number of heatwave days, temperatures and fire risk in detail down to a 5km x 5km grid of almost all forested and plantation areas of Australia.
The best available scientific models for climate change have been used in developing the tool, which enables users to see both the “most likely” result and a range of other possible results for 2030, 2050 and 2070, as opposed to the current situation.
CSIRO Research Scientist, Dr Patrick Mitchell, said the tool was intended to increase the industry’s awareness of climate change and, ultimately, to manage risk and improve productivity.
“We’ve tried to make the tool really easy to use, without compromising its scientific integrity. There are also user videos on the site as well as a written user guide,” he said.
“Climate change is particularly crucial for forestry because there’s such a long lag between planting and harvesting. We’re hoping this tool will mean that forest managers can make more informed decisions.”
In addition to probing results for particular locations or areas, the Forest Climate Risk Tool enables forest managers to explore climate change by questions and by themes.
The themes are: temperature; rainfall and drought; and heatwaves and fire danger. The questions relate to changes in the planting window; water and heat stress over the rotation; climate drivers related to pests; and fire danger.
General Manager of Forest Resources at HVP Plantations, Tony O’Hara, said the firm had an increasing focus on the threat that climate change could pose to 170,000 hectares they have under plantation in Victoria.
“The risks in terms of fire, pests, diseases, planting timing and even care of staff in the field could all change with the climate, making it valuable to have information on predicted variations in climate and the likelihood of extreme events. The next step is to work on what we can do to accommodate that future situation.
“This complements other work we’re doing, for example increasing the resilience of trees and working with land owners outside our plantations to reduce fire risk.
“Using this new tool, we have established some level of comfort that we are going to be able to grow trees in future in most of our current areas.
“The next step in using the tool would be to input data from it into other systems such as CABALA (which models tree growth) and the Phoenix Rapid Fire bushfire modelling tool.”
The steering committee for the project included representatives of HQPlantations, Forico, NewForests, HVP Plantations and the Forestry Corporation of NSW.
You can request access to the tool here.
Case study – Mount Gambier, SA, in 2050 (most likely scenario) compared to the previous 30 years.
Two degrees increase in annual temperature – 16 degrees in 2050 vs 14 degrees now. Five per cent reduction in annual rain – 763mm in 2050 vs 803mm now Four more high fire danger days per year – 31 in 2050 vs 27 a year now. Five more days over 35 degrees per year – 12 in 2050 vs 7 a year now.
Using this information, further modelling outside the Forest Climate Risk Tool suggests there is likely to be a reduction of between five and 15 per cent in total volume at harvest in 2050, compared with that which would occur if the current climate continued unchanged.
Biosecurity not working for forestryBiosecurity works for NZ agriculture but not forestry - The recent arrival of myrtle rust in New Zealand has led many to question whether our biosecurity system is really world-class, particularly in keeping plant diseases out of the country.
New evidence from the Bio-Protection Research Centre, and published in PLoS Biology, has for the first time assessed just how well our biosecurity system stacks up.
New Zealand is in a unique position, having kept records of plant diseases since the late 1800s. “This allows us, for the first time anywhere in the world, to piece together the long-term trend in plant disease arrivals and whether biosecurity measures have had an impact,” says Prof Philip Hulme, of the Bio-Protection Research Centre, based at Lincoln University.
Despite increasing numbers of international tourists and growing global trade, the number of new plant diseases appearing on our crops each year has been declining since New Zealand began improving border biosecurity in the 1980s.
“The Government and industry invest millions of dollars in keeping plant diseases out of the country, but this is the first evidence to suggest there is a tangible return on this investment,” says Prof Hulme. “Our results suggest that without effective biosecurity the number of plant diseases found in New Zealand each year would have increased in step with the level of trade imports. The fact this isn’t the case is a significant outcome.”
But the findings are not good news for all industries, as agriculture rather than forestry reaps the greatest benefits.
“The combination of government investment in agricultural quarantine and an industry-based seed certification scheme could explain the decline in the arrival of plant diseases in the cereal and pasture sectors,” says Prof Hulme. “In contrast, forestry biosecurity has come late to the game, especially with imports of untreated wood being permitted until relatively recently, and so diseases of forest trees are still increasing at a similar rate to our level of trade imports.”
Prof Hulme said it was important to realise that even when they were effective, biosecurity measures only slowed down the rate of pests getting into New Zealand, rather than stopping them altogether.
“We are still getting diseases coming in, but at a much slower rate than we would have, given the huge growth in international trade,” he says. “Thus while targeted investment in biosecurity may be effective in reducing plant diseases arriving through trade, there is still scope for improving border biosecurity and expanding disease surveillance.”
Champion Freight ReportsThanks to the great team at Champion Freight we've got the latest export market activity update for you in a series of really self-explanatory charts. They have some easy-to- read labels on the charts so they are readily identifiable even when printed in black & white.
To download the full report, click here.
Source: Champion Freight
Rubicon gains on Arborgen maturingRubicon says FY earnings beat guidance as ArborGen moves out of R&D phase – NZX- listed forestry investor Rubicon says it beat its target of doubling annual earnings as its ArborGen unit shifts into full commercialisation, posting a muddle of numbers including a new balance date and pared back business units.
Auckland-based Rubicon aligned its balance date with its fully-owned subsidiary ArborGen, which sells and develops advanced genetic seedlings to improve forest productivity and is its only asset, to 30 Sept from 30 June and this week released first- half accounts. The firm annualised those earnings to give a like-for-like comparison rather than rely on the statutory six-month versus 15-month periods on different balance dates in its accounts.
Rubicon said its US-GAAP earnings before interest, taxes, depreciation and amortisation was US$4.3 million for the year to March 31 on gross profit of US$18 million. That's the measure ArborGen would report in a US listing situation and involves the full expensing of all US$5.6 million research and development activities as US GAAP does not allow the capitalisation of these costs.
The company had previously said it expected annual ebitda to more than double to US$3.4 million and chair Stephen Kasnet today said "these numbers are ahead of our previously announced earnings targets, in what turned out to be a very difficult operating environment". An extremely tough hurricane season during the year hit seedling sales by some 20 million units.
Looking ahead, Rubicon is targeting earnings "approaching" US$7 million for the March 2019 year, dependent on weather and demand conditions.
“It should be clear now that ArborGen’s heavy product development phase and the related past ebitda losses which peaked at US$18 million, are now well behind us,” Kasnet said.
He added that ArborGen is now firmly ebitda positive and its forecasts are for it to be net earnings and operating cash-positive from now as the firm ramps up sales of its advanced genetics products in the US and develops its position in Brazil.
Australian Foresters Awards openNominations open for the Prince of Wales Award for Sustainable Forestry - The Institute of Foresters of Australia is calling for nominations for His Royal Highness The Prince of Wales Sustainable Forestry Award for 2018.
"It is about forests and foresters," said Mr Rob de Fégely, Vice-President of the Institute of Foresters of Australia and Director responsible for international relations.
"His Royal Highness has a well-known passion for forests and natural production systems. In recent years, he has provided support to the professional forestry institutes in Australia and New Zealand and prior to that in Canada and United Kingdom.
"His Royal Highness wants to encourage greater awareness of the importance of sustainably managing the world’s forests and training and creating a network of young foresters who will manage them professionally.
"Forestry is about long term thinking and planning and the stability of his leadership should inspire many younger members of our profession to join his quest to sustainably managing the worlds’ forests.
"We are fortunate to have such a prominent person as the Prince of Wales encouraging our profession and taking such a keen interest in forest management."
Awardees must be committed to public outreach and knowledge exchange, focusing on the wise use and conservation of forests and the ecosystems that they encompass.
Eligible recipients must either be a student or recent graduate and up to 30 years of age from a forestry, natural resources or environmental science university or college program, who have made outstanding contributions to their school and program, and to forest professionalism in general, within their community.
Recipients must be members in good standing of their respective Institutes, thus demonstrating their personal commitment to lifelong continuing education and professional development, and their support of forest professionalism.
Nominations close 30 June 2018 at www.forestry.org.au
Photo: The Australian and New Zealand winners of the Prince of Wales awards in 2017, Jesse Mahoney and Alfred Duval met with His Royal Highness at the IFA roundtable
China: Super capacitors from woodChinese researchers make sustainable supercapacitors from wood - Supercapacitors are touted by many as the wave of the future when it comes to battery storage for everything from cell phones to electric cars. Unlike batteries, supercapacitors can charge and discharge much more rapidly — a boon for impatient drivers who want to be able to charge their electric cars quickly.
The key to supercap performance is electrodes with a large surface area and high conductivity that are inexpensive to manufacture, according to Science Daily. Carbon aerogels satisfy the first two requirements but have significant drawbacks. Some are made from phenolic precursors which are inexpensive but not environmentally friendly. Others are made from graphene and carbon nanotube precursors but are costly to manufacture.
At the University of Science and Technology of China researchers have discovered a new process that is low cost and sustainable using nanocellulose, the primary component of wood pulp that gives strength to the cell walls of trees. Once extracted in the lab, it forms a stable, highly porous network which when oxidized forms a micro- porous hydrogel of highly oriented cellulose nano-fibrils of uniform width and length.
Like most scientific research, there was not a straight line between the initial discovery and the final process. A lot of tweaking went on in the lab to get things to work just right. Eventually, it was found that heating the hydrogel in the presence of para- toluenesulfonic acid, an organic acid catalyst, lowered the decomposition temperature and yielded a “mechanically stable and porous three dimensional nano-fibrous network” featuring a “large specific surface area and high electrical conductivity,” the researchers say in a report published by the journal Angewandte Chemie International.
The chemists have been able to create a low cost, environmentally friendly wood- based carbon aerogel that works well as a binder-free electrode for supercapacitor applications with electro-chemical properties comparable to commercial electrodes currently in use. Now the hard work of transitioning this discovery from the laboratory to commercial viability will begin.
Holidays Act set for reviewWorkplace Relations and Safety Minister Iain Lees-Galloway has announced a new taskforce to recommend changes to the Holidays Act 2003 in a bid to unravel the legislation's complexity to cope with a fast-changing labour market.
Lees-Galloway said the taskforce will bring together government, business and workers to recommend changes to the act by mid-2019. Business has long lobbied for changes, arguing its complexity costs time and money, in particular with the rising number of part-time and casual workers. Law firm Simpson Grierson has previously said the legislation was originally drafted in 1981 "when most businesses closed on weekends and a 9-to-5 Monday-to-Friday work week was the norm".
"There’s been enormous change in our labour market over the past 15 years and it’s clear we need to look at the Holidays Act with a fresh pair of eyes and ensure it is fit for modern workplaces and new working arrangements," said Lees-Galloway. “With an increasing variety of work patterns and pay arrangements, the legislative requirements of the act are proving difficult and costly for employers to apply and employees are not receiving their full entitlements."
As a result, the legislation "needs to be straightforward and simple to implement," he said.
Data from the Ministry of Business, Innovation and Employment indicates between July 2012 and March 2018, 51 employers have paid arrears to 18,100 workers totalling $6.14 million due to noncompliance with the act. The data doesn't include data from the New Zealand Police. According to MBIE, the police have made six arrears payments totalling $39 million, and have more payments to come as they await the implementation of their new compliant payroll system.
The working group will be chaired by Gordon Anderson, a law professor at Victoria University with extensive experience in employment law, both as an academic and as a barrister.
John Deere: Results and forecast positiveEquipment net sales for second quarter climb 34% on strength in key markets - Conditions for agricultural and construction equipment show broad-based improvement. Worldwide net sales and revenues increased 29 percent for the quarter and and rose 27 percent for six months. Company equipment sales are projected to increase by about 30 percent for fiscal 2018 and by about 35 percent for the third quarter compared with the same periods of 2017.
Construction and forestry sales increased 84 percent for the quarter and 73 percent for six months, with the newly acquired Wirtgen adding 60 percent and 44 percent for the respective periods. Also helping sales for both periods were higher shipment volumes and the favorable effects of currency translation.
Deere's worldwide sales of construction and forestry equipment are anticipated to be up about 83 percent for 2018, including a positive currency-translation effect of about 1 percent. Wirtgen is expected to add about 56 percent to the division's sales for the year.
The outlook reflects continued improvement in demand driven by higher housing starts in the US, increased activity in the oil and gas sector, and economic growth worldwide. In forestry, global industry sales are expected to be up about 10 percent mainly as a result of improved demand throughout the world, led by North America.
... almost finally ... a wood product for the massesAlcoholic beverages with flavours reminiscent of whisky aged in wooden barrels have been produced by fermenting cedar, white birch and cherry trees.
Four kilograms of wood yielded 3.8 litres of liquid, with an alcohol content of about 15 per cent – similar to sake.
“We are looking forward to commercialising this ‘wood sake,’ so that the usage of wood will be expanded,” an official at the Institute of Forestry and Forest Products Research Institute said.
Alcoholic fermentation of wood is not a new concept, having long formed a crucial part of the process involved with the production of biofuels.
However, the major difference between this pre-existing method and the new method developed by the Institute is the elimination of the need for wood materials to be processed either with sulphuric acid or exposed to high temperatures to dissolve the plant fibres from which the alcohol is produced. This not only eliminates the distinctive woody flavour, but also renders the resultant alcohol unsuitable for human consumption, due to the presence of harmful substances.
The Institute’s method differs in that it has developed technology capable of crushing wood into microscopic chips, through churning wood in water along with a large number of tiny metal balls. Yeast and enzymes are therefore able to dissolve the plant fibres without the need for sulphuric acid or exposure to high temperatures, making it safe to drink and maintaining the aroma of the wood.
According to the Institute, this method is a world first.
Once safety and a number of other details have been confirmed, the Institute hopes to commercialise the world’s first wood-based alcoholic drinks within the next three years.
Buy and Sell
... and finally ... mid-week humour for you
"Would you like a new mink coat?" he asks.
"Has your son decided what he wants to be when he grows up?" I asked my friend.
"He wants to be a garbage man," he replied.
"That's an unusual ambition to have at such a young age."
"Not really. He thinks that garbage men work only on Tuesdays."
His nurse, his wife, his daughter and 2 sons, are with him.
He asks for 2 witnesses to be present and a camcorder be in place to record his last wishes, and when all is ready he begins to speak:
"My son, Bernie, I want you to take the Mayfair houses."
"My daughter, Sybil, you take the apartments over in the east end."
"My son, Jamie, I want you to take the offices over in the city centre."
"Sarah, my dear wife, please take all the residential buildings on the banks of the river."
The nurse and witnesses are blown away as they did not realise his extensive holdings, and as Doug slips away, the nurse says, "Mrs. Smith, your husband must have been such a hard-working man to have accumulated all this property".
Sarah replies, "Property ? ..... He had a paper round!"
Thanks for keeping up with the latest wood news with us!
We welcome comments and contributions on WoodWeek. For details on advertising for positions within the forest products industry or for products and services, either within the weekly newsletter or on this web page, please contact us.
Copyright 2004-2018 © Innovatek Ltd. All rights reserved