WoodWeek 25 March 2020
With now only a few hours from Alert Level 4 coming into effect in New Zealand, forestry, wood processing and manufacturing have not been classified as an essential business. Everyone in this industry should therefore assume that you will be required to shut down by the deadline unless you have had a conversation or confirmation from Te Uru Rakau that you are an exception as you provide critical input to some of the sectors classified as essential services.
Now to today's industry news - The Forest Owners Association (FOA) says it’s working closely with government in making sure that relief packages for forestry workers will both look after the workers and also speed up economic recovery when the almost inevitable New Zealand COVID-19 epidemic is over. Incoming FOA President, Phil Taylor, says forestry will be a crucial export tool in leading New Zealand’s recovery.
In our newest fortnightly SnapSTAT feature, we highlight the forecast for New Zealand’s forestry and wood products exports from this month’s MPI ‘State of Primary Industries’ quarterly update. Click on the image to go to the source chart in the MPI report online.
Looking back on the 2019 year for China's wood products industry, log imports in 2019 totalled 60.57 million cubic metres. China’s log imports from the Czech Republic and Germany in 2019 soared to 4.24 million cubic metres and 2.30 million cubic metres respectively. New Zealand was the main log supplier to China in 2019 accounting for 29% of total log imports. Imports from New Zealand totalled 17.74 million cubic metres in 2019, a year on year increase of 2%.
The Government has allocated $100 million to help redeploy workers affected by the economic impact of COVID-19, with the hard-hit region of Gisborne-Tairawhiti to be the first helped. Alternative work identified for Tairawhiti forestry workers includes local roading work, including road maintenance, hazardous tree removal, fast-tracked One Billion Trees projects, conservation activities, retraining and educational opportunities.
This week we have for you:
Status for forestry and wood products for Level 4With now only a few hours from Alert Level 4 coming into effect in New Zealand, forestry, wood processing and manufacturing have not been classified as an essential business. The industry should therefore assume that you will be required to shut down by the deadline unless you have had a conversation or confirmation from Te Uru Rakau that you are an exception as you provide critical input to some of the sectors classified as essential services.
At a broad level what this is likely to mean is that forestry harvesting and silviculture operations and primary sawmills will need to shut down. Pulp and paper manufacturing will need to shut down non-essential elements in a way that allows for production to recommence easily while maintaining essential production. You should have spoken to Te Uru Rakau (Julie Collins or Jason Wilson) about what that might mean for you. Please find attached a link to the government announcement that sets this out at a high level.
Other forms of primary process should be shutting down in safe and appropriate way and allows for production to recommence easily. If that is not possible by the deadline for Alert Level 4 you need to let Te Uru Rakau know if you have not already.
Secondary processing of pallets and packaging material that supplies critical inputs to the pharmaceutical and food and beverage supply chain is likely to be classified as an essential part of the supply chain and will need to register on the attached site and meet the requirements set out for ensuring a safe environment for workers and prevent the further spread of COVID-19.
Plant nurseries will be able to maintain minimum activities to keep their capital stock and plants alive. They will need to register on the above site if they employ more than 5 people and meet the requirements set out for ensuring a safe environment for workers and prevent the further spread of COVID-19.
For those that have materials on site that supply critical inputs such as chip or pellets for energy production for hospitals, meat plants, dairy plants or other essential services, and those with existing stock required by secondary processors that supply pallets and packaging material to essential services, Te Uru Rakau is working to ensure you will still be able to supply from site even though production has shut down. Once again if you have not been in touch with Te Uru Rakau on this you should do this today.
There are a range of other issues that have been raised with us which we are addressing as a matter of priority around export shipments beyond those that are already loading, RMA requirements, in forest and site security and extensions of time for safely shutting down manufacturing. We have had to focus on the most urgent issues.
Thank you for your leadership at what I know is an extremely challenging time for you, your employees and your business and business owners. The government continues to see the forestry, wood processing and manufacturing sector as an important part of the economy and it will be an important part of the recovery. However, as with other parts of the economy, we are having to make hard decisions to prevent the further spread of COVID-19 and to save lives.
Source: Te Uru Rakau
$100 million to redeploy workersThe Government has allocated $100 million to help redeploy workers affected by the economic impact of COVID-19, with the hard-hit region of Gisborne-Tairawhiti to be the first helped, Economic Development Minister Phil Twyford, Forestry and Regional Economic Development Minister Shane Jones and Employment Minister Willie Jackson announced today.
Phil Twyford says COVID-19 is having a significant impact on workers throughout New Zealand. “Nowhere more than on forestry workers in Tairawhiti.
“Our Government is moving quickly to help people stay in work through a $100 million package which will see workers redeployed into local alternative employment for the next three to six months. Of this funding, $28 million will go to Tairawhiti to help redeploy almost 300 workers.
“Forestry was one of the first industries to be seriously impacted by COVID-19 but by keeping the infrastructure and workforce of the sector intact, we hope it will be one of the first to recover,” Phil Twyford said.
Alternative work identified for Tairawhiti forestry workers includes:
• local roading work, including road maintenance
• hazardous tree removal
• fast-tracked One Billion Trees projects
• conservation activities
• retraining and educational opportunities.
The Tairawhiti package will be administered through the Provincial Development Unit in partnership with the Mayors’ Forum and Gisborne District Council. Affected workers will be referred via the Ministry of Social Development’s Rapid Response Team and affected businesses.
“A significant portion of the Tairawhiti economy is linked to forestry, which accounts for 6.7 per cent of regional GDP,” Shane Jones says.
“The sector was just recovering from a slow-down over last winter. Many small firms used their cash reserves to get them through that and some companies are now struggling to survive.
“However, the future for the forestry sector is extremely bright and we want to ensure it is in a position to recover from the economic impacts of COVID-19 as quickly as possible. By redeploying workers to short-term projects, we can help ensure they are available to go back to the forestry sector once it returns to normal,” Shane Jones says.
“I want to thank the forestry sector for working with the Government to find solutions to support workers.”
Willie Jackson says the package for Tairawhiti includes training, transport, administration, assurance and other project-related services.
“Our Government will be constantly reviewing all its measures to soften the impact of COVID-19 on workers and businesses. We want to make sure the help we are providing is getting to those people and businesses who need it the most,” Willie Jackson says.
No Events? Need an alternative?Now that most trade shows and conferences are being cancelled or postponed due to the coronavirus outbreak, industry professionals are looking for other ways to keep one another informed. Perhaps you’re launching a new laser scanner or indoor mapping solution, or you want to share knowledge about innovative methods that achieve real efficiency gains… but which platforms can you use instead of physical events?
It’s probably counter intuitive to what most do when times get tough, but brand building should be an integral part of your business thinking right now as we head into a global slowdown. An excellent article on the importance of maintaining brand awareness in conditions like these can be read here. Innovatek and the Forest Industry Engineering Association offers several possibilities to fill the gaps in your communication strategy.
You can showcase your project or product through two of the industry’s most widely recognised and read newsletters, www.fridayoffcuts.com and www.woodweek.com. Have you recently completed a challenging customer project? Or have you developed a new state-of-the-art software solution for collection of data out in the forest? Both weekly newsletters are the ideal place to share more details, so why not contribute an article?
In addition to these two weekly newsletters, communities of like-minded individuals are communicating much more regularly through three monthly tech newsletters set up for those typically attending the region’s most widely attended technology events. www.foresttech.news, www.harvesttech.news and www.woodtech.news are being sent out to specific and targeted groupings within the forestry and wood products sector.
It’s a great place to announce your latest company news and product launches, particularly in the current environment when you’re looking to target a specific reader profile, industry segment or geographical region. All of these communications platforms will provide you with an effective solution to keep your brand in front of your target audience in the current environment.
This is just a brief summary of how we could help you to keep your business going in these unprecedented times. Interested in a tailor-made proposal? Feel free to contact our Sales & Marketing Manager, Gordon Thomson on Tel: (+64) 7 921 1384, (+64) 27 275 8022 or firstname.lastname@example.org
Foresters working with government officialsThe Forest Owners Association says it’s working closely with government in making sure that relief packages for forestry workers will both look after the workers and also speed economic recovery when the almost inevitable New Zealand COVID-19 epidemic is over.
The incoming FOA President, Phil Taylor says forestry will be a crucial export tool in leading New Zealand’s recovery.
“In common with the rest of the primary sector, we will be ready to do our part to pull our economy through the extraordinary times which are ahead of us.”
“After rock lobsters, forestry was been the second longest New Zealand industry to be impacted by measures in China to try to contain COVID-19. This has created some urgency to help people who have now been out of work for weeks.”
The Forestry Minister, Shane Jones, has announced a $28m relief package for forest workers in the Gisborne region, which will provide work for 300 forest workers in jobs such as road maintenance of removal of trees which are in danger of falling onto roads or powerlines.
Phil Taylor says it’s great that these workers can be given employment that is useful to the local economy, doesn’t take the workers away from their home region and keeps the workforce intact.
“The worldwide appetite for timber is undiminished. In fact, it’s likely to increase for New Zealand timber as climate change has an impact on forests in other countries, such as Canada, Australia and through Europe.”
The Forest Growers Levy Trust (FGLT), met last week in Wellington and endorsed the government’s move in the Gisborne region. The trust collects a levy on the national log harvest for industry good projects. Its Chair, Geoff Thompson, says it appreciates the severity of the economic situation and will continue to back its forest work programme, despite the hit on its income from a reduced harvest.
“These are incredibly difficult and stressful times. That means we must look after our workforce and work with the government on the best ways we can do this.”
New players weighed in with logs to ChinaSlight increase in log imports in 2019 - Looking back on the 2019 year for China's wood products industry, log imports in 2019 totalled 60.57 million cubic metres valued at US$9.434 billion (CIF), a year on year increase of just 1% in volume but there was a decline in the value of imports by 14%. The average price for imported logs was US$156 (CIF) per cubic metre.
Of total log imports, 2019 softwood log imports rose 9% to 45.26 million cubic metres, accounting for 75% of the national total, 5% up on 2018. The average price for imported softwood logs was US$125 (CIF) per cubic metre, down 10% on levels in 2018.
Log imports from Czech Republic and Germany soar - China’s log imports from the Czech Republic and Germany in 2019 soared to 4.24 million cubic metres and 2.30 million cubic metres respectively. New Zealand was the main log supplier to China in 2019 accounting for 29% of total log imports. Imports from New Zealand totalled 17.74 million cubic metres in 2019, a year on year increase of 2%.
The second ranked supplier of logs was Russia at 7.75 million cubic metres, a year on year decline 28%, accounting for about 12% of the national total, down 6% over 2018.
Average CIF prices for imported logs from New Zealand fell 9% to US$128 per cubic metre and from Russia CIF prices fell 3% to US$120 per cubic metre in 2019.
Source: ITTO TTM Report: 24:5
East Coast forestry gets $40m government injectionThe East Coast is to get a $40 million injection to employ out-of-work forestry crews and sustain development of new wood processing capacity.
The Gisborne-Tairawhiti region has been allocated $28 million by the government to deliver local, alternative work for forestry crews, some of whom haven’t worked since January. It is the first allocation from $100 million set aside for industries hardest hit by the covid-19 outbreak.
The Tairawhiti work package will be administered through the Provincial Development Unit in partnership with the Mayors’ Forum and Gisborne District Council. Affected workers will be referred by the Ministry of Social Development and affected firms.
Potential work and redeployment includes local roading work, hazardous tree removal, accelerated planting under the one billion trees programme, conservation projects and retraining.
“Forestry was one of the first industries to be seriously impacted by covid-19 but by keeping the infrastructure and workforce of the sector intact, we hope it will be one of the first to recover,” Economic Development Minister Phil Twyford said in a statement.
The programme is intended to help redeploy almost 300 workers in the region for the next three to six months.
Forestry accounts for close to 7 percent of the East Coast economy. Eastland Port this week said its log flows to China had stabilised but were still about 30 percent below budget.
Unlike many of the country’s other forestry regions, Tairawhiti has relatively little processing capacity to absorb excess harvest flows.
Forestry Minister Shane Jones said the sector’s future in the region is “extremely bright” but it needs to be sustained while markets return to normal.
“The sector was just recovering from a slowdown over last winter. Many small firms used their cash reserves to get them through that and some companies are now struggling to survive,” he said in a statement.
Separately, Jones today announced $13 million in loans for a redevelopment of the Prime Wood processing facility south-west of Gisborne.
The bulk of the money, from the Provincial Growth Fund, will accelerate laminated processing at the site.
Jones said a $12.1 million loan will enable construction to begin on the processing line, which will increase the site’s capacity from 3.5 days a week to seven-day operation. Up to 74 new jobs may be created at the site in coming months, he said.
Another $980,000 has been lent to project developer WET Gisborne – a venture between Trust Tairawhiti and Wood Energy Technology – for a heat plant planned at the site.
Jones said the fabrication work for both the processing line and the heat plant would help ensure job continuity for local engineering firms.
Trust Tairawhiti - formerly Eastland Community Trust - bought the closed Prime sawmill site at Manutuke in 2015. In 2018 it sold the main mill to Far East Sawmills but retained the 22- hectare site as part of a plan to develop a processing cluster there.
Far East received $500,000 from the Provincial Growth Fund toward the recommissioning of the mill. Last July, the fund agreed to a staged investment of up to $19.5 million to help develop the wood cluster.
Tigercat 6050 Carbonator: Eco-FriendlyThe 6050 carbonator is the first product offering from Tigercat’s new material processing equipment line-up.
Unique, cost-effective and eco-friendly, the 6050 carbonator reduces wood debris volume onsite through an environmentally friendly carbon sequestration process with no material pre-processing required.
Logs, limbs, brush, stumps, yard waste, pallets, clean lumber and other clean wood-based debris can be reduced by 90-95%. The remaining carbon-based output – often referred to as biochar – sequesters the captured carbon. Because there is no resulting organic decay, along with the associated release of greenhouse gasses, Tigercat believes that this carbonization process represents the lowest carbon footprint of any competing material reduction method.
The 6050 efficiently processes wood debris at high throughput rates. Under air and over- air fans create optimal conditions to maximize carbon content in the output.
The 6050 is equipped with replaceable thermo-ceramic panels rated to 1 650°C (3,000°F). A quenching system cools the end product to near ambient temperatures for handling, while further improving the quality of the carbon-based output. An optional conveyor system is available for output collection.
“It is a single step sequestration process done onsite,” states vice president, material processing products, Anders Ragnarsson. “A cost-effective and environmentally friendly solution that reduces debris transportation and disposal costs.”
The 6050 carbonator is extremely operator friendly with full remote control for all functions including machine travel. A live stream video monitoring system provides full visibility for easy feeding.
The Tigercat 6050 carbonator can be used for a variety of different applications including forestry and land clearing, construction and demolition, agriculture, and primary and secondary mill residue.
More Support For Wood ProcessingThe Provincial Growth Fund (PGF) is ramping up support for Tairawhiti’s wood processing sector to bolster the region’s economy at a time of heightened uncertainty, Regional Economic Development Minister Shane Jones announced today.
Following earlier announcements today of a regional support package for Tairawhiti, Minister Jones has also announced a $12.1 million loan from the PGF for WET Gisborne Ltd.
The funding will accelerate the development of WET Gisborne’s wood processing production line, which will produce a laminated structural wood product at the Wood Cluster Centre of Excellence located in Gisborne.
“I’m pleased we’ve been able to work alongside the region on projects that will help diversify the forestry sector, which is overly reliant on log exports to China,” Shane Jones said.
“This investment is another way the Government is supporting Gisborne and the wider region as the forestry industry experiences the effects of Covid-19. The PGF support will allow construction to begin on the production line and is part of a wider focus on wood processing that is expected to create 74 new jobs in coming months.
“Work is about to begin on the first phase of the production line that will increase capacity from 3.5 days per week to a 24hr/7days-a-week operation. The second phase, which will establish New Zealand’s first fully commercial scale line, will start next summer,” Shane Jones said.
In addition to the loan, Regional Economic Development Ministers have also approved a $980,000 loan towards the Wood Cluster Heat Plant, which is integral to the overall success of the region’s wood processing aspirations.
“Wood processing is one of the biggest economic growth opportunities in Tairawhiti. This production line will lead to higher-value forestry products being produced locally and develop new economic growth in the forestry industry.
“The engineering work required to build the processing line and heat plant will ensure job continuity for local engineering firms.
“This latest investment builds on a commitment of $19.5 million investment into the Wood Cluster Centre of Excellence announced in July last year. The centre will process and produce higher-value forestry products and see more money going back into the community via bigger pay packets for local workers.
“While New Zealand and the world is experiencing an economic shock, PGF projects are primed to help place the country on an excellent footing post–virus,” Shane Jones said.
Recovery: Foresters urged to manage harvestForest owners need to work closely with the rest of the sector to restore production in a way that is sustainable for contracting crews and the markets logs are destined for, the Forest Industry Contractors Association says.
Ports around the country have reported more stable log volumes heading to China in recent weeks and several are hoping to see further improvements during the next two months. Fonterra, Briscoe Group and Mainfreight this week also reported improving capacity and demand in China.
Forestry Industry Contractors Association chief executive Prue Younger said two large forest owners had indicated they could be back to full production in about a month. While that was an encouraging signal, she said it would also be a challenge, given the number of workers already lost from the country’s forestry crews and the potential to “inadvertently flood the market again.”
“That would be incredibly disappointing,” she told BusinessDesk.
Forestry, tourism and aviation have been the sectors hit hardest by the coronavirus pandemic. China’s economy, the largest user of New Zealand logs, virtually shutdown in January as the government restricted travel to contain the virus.
The economy there is picking up again, but only slowly, and may struggle to get back to pre-virus levels given the global markets it supplies are also now slowing as they contend with the pandemic.
Northport, one of the country’s largest forestry terminals, last week said its log cargoes were down about 40 percent on budget. Earlier this week, Eastland said its log volumes were down about 30 percent and that it was hoping to see a pick-up during the next two months.
Younger said contractors have no control of harvest decisions and forest owners are competing with one another. But she said the parties need to work together to lift volumes in a manageable way.
“We’ve got to learn some lessons out of this.” Younger said her industry was five to six weeks ahead of the rest of the economy in terms of the hit it had taken from coronavirus. About 30 percent of its workers are not working and many have left the industry and taken their skills elsewhere.
Others, who could have benefited from the “amazing” recruitment drive currently underway in horticulture, have instead waited for a pick-up in harvesting. She said about 20 percent of her members have indicated they may take-up the wage subsidy scheme offered by the government this week; those not working will need to lean on the tax- breaks being offered.
Younger said some contractors currently have no income but are carrying high debt on heavy equipment they have invested in. Banks had been “exceptionally good” in shifting loans to interest-only – and in some cases no interest – but that is becoming more of an issue as the downturn continues.
“The financial institutions can’t say `no payments’ for ever.”
Don Carson, communications manager for the Forest Owners Association, said there are signs that China’s economy is recovering and that competing flows of salvaged European spruce into China may have also slowed. But he said log inventories in China are high and it would take all of the country’s industrial systems to come together to draw them down.
While it might be possible to restore production to previous levels, he said that would take time, given the need to book contractors, trucking and vessels. Even then, prices are unlikely to be back to where they had been, he said.
“While that inventory draws down, you wouldn’t be expecting the prices that you were getting before.”
Forestry: Councils commit to working togetherThe Hawke’s Bay Regional Council and Wairoa District Council have committed to working together on managing the growth in the planting and harvest of forestry in the Wairoa District.
The two councils met recently to discuss the sustainable development of forestry in the district, along with concerns raised by the community around increased forestry and the national regulations now in place for plantation forestry.
Wairoa District Mayor Craig Little says both councils understand the community’s concerns about forestry and are committed to ensuring there is the best possible mix of land use in the district.
“I believe by working together we can ensure we have trees planted in the right place for the right purpose and ensure we continue to have a great mix of land use across our district,” says Mr Little.
He says there has been an increasing volume of forestry harvest and new plantings in the district.
At the joint meeting the Wairoa District and Hawke’s Bay Regional Councils committed to ensuring the effects of forestry harvest are strictly managed under the National Environmental Standards to ensure the protection of local waterways from sediment and forestry slash.
Hawke’s Bay Regional Council Chair Rex Graham says no one wants any newly established forests in the district to create problems for future generations or displace highly productive pastoral land.
“Our regulation and catchment teams will be working closely with the forestry industry and landowners to get the best possible mix of land use for the Wairoa District,” says Mr Graham.
“We accept there are some challenging legacy issues with forestry to deal with, but new national regulations mean forestry management will improve over time.”
Read this: It may save your lifeWhat's Your Chance Of Surviving A Cardiac Arrest? - St John releases Out of Hospital Cardiac Arrest Annual Report 2019.
Research undertaken by St John shows there is a 13% chance of survival from a cardiac arrest outside of hospital.
Each year St John publishes its "Out of Hospital Cardiac Arrest Report." This year’s study reveals that while survival rates remain constant, there is much more we can do to save lives.
Each day in New Zealand St John treats approximately five people for an out-of- hospital cardiac arrest, and in 76% of cases a bystander starts CPR, but an AED (automated external defibrillator) is only used 4% of the time.
St John Medical Director Dr Tony Smith says these statistics show that while New Zealanders are becoming aware of the importance of CPR, not only are more AEDs needed in local communities, but the public needs to be comfortable using them.
“Anyone can use an AED; all you need to do is turn it on and follow the simple instructions. Know where the AEDs are in your area, for example via the AED locations website, and have the confidence to use one. For every minute that goes by without CPR or using an AED the chance of survival drops by 10-15%.”
“More AEDs are needed in remote and deprived areas as these are the people more likely to have a cardiac arrest but less likely to survive.”
The report shows community defibrillation can improve cardiac arrest survival by over 35% and St John is working with community partners, such as ASB, to get AEDs into remote communities, including marae, to help address this inequity.
Dr Smith explains that there are many factors that go into cardiac arrest survival.
“The chain of survival starts from the bystander recognising someone is in cardiac arrest, calling an ambulance, starting CPR and using an AED, and continues with treatment on scene by skilled ambulance officers, through to arrival at hospital and ongoing treatment by hospital clinicians.”
Dr Smith says more work and resourcing is needed in order for St John to improve cardiac arrest survival statistics to a similar level of comparable ambulance services internationally.
“St John’s clinical processes continue to be of a high standard but without greater funding and resources we are unable to make the same improvements as other services. We want to establish more complex clinical training and auditing of each cardiac arrest, improve technology and equipment and, significantly, implement the Global Resuscitation Alliance 10 steps to improving outcomes for New Zealand.”
“Nonetheless the message is clear, if someone is in cardiac arrest, call an ambulance (111), start CPR and use an AED.”
Buy and Sell
... and finally .... some mid-week humour
Like a lot of husbands throughout history, Webster would sit
down and try to talk to his wife. But as soon as he would start
to say something, his wife would say, "... And what's that
supposed to mean?"
"For those who may not know this: When the preacher says, 'You may now kiss the bride,' he's only speaking to the groom." - David Gunter
Here is your first question, the foreman said. "Without using numbers, represent the number 9."
"Without numbers?" The Irishman says? "Dat is easy." And proceeds to draw three trees.
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 2004-2020 © Innovatek Ltd. All rights reserved