WoodWeek 8 April 2020
Being proactive, forest owners and contractors are developing guidelines for safe work practices so logging and processing can begin where and when it is required. Harvesting and sawmilling has been halted since the Covid-19 lockdown began on March 26. Stocks are being run down as essential manufacturers like packaging makers and pallet producers work through inventories. It’s been confusing to see Australian and Canadian lockdown rules deeming forestry and wood products to be essential industries, while that’s not the case in New Zealand.
On to more positive news – be sure to get your new FIEA Forest Products Map before they sell out. We’ve just released the newest biennial map resource detailing Australasia’s wood processing and manufacturing industries. Since the 2018 edition there have been over 50 major updates to mill locations, ownership and sawn production. Details on how you can order yours contained in the story below.
While this work hiatus brings its own trials and tribulations for all of us, there is a light at the end of this tunnel now that we are halfway through the lockdown. We look forward to seeing you all again soon and that a return to life closer to normal will bring a reasonably quick return in demand for logs and wood products.
This week we have for you:
Tuesday 14 April 10am - Industry UpdateEditorial - Hello again after the Easter long weekend, lockdown-style.
We are providing daily updates, mainly for our readers in New Zealand: This is the latest from Te Uru Rakau this morning:
As you are no doubt aware Te Uru Rakau have been working through the all of Government approval process to start parts of the forestry and wood products sector in order to continue supply of essential services under Alert Level 4.
Over the Easter long weekend significant progress was made but we are waiting on final confirmation and approval to be issued. At this stage we expect that to be later today and Te Uru Rakau would like to brief the sector as soon as approvals come through.
Foresters, processors readying for restartForesters, processors readying for restart - Forest owners and contractors are developing guidelines for safe work practices so logging and processing can begin where and when it is required.
Harvesting and saw milling has been halted since the covid-19 lockdown began on March 26 and stocks are being run down as essential manufacturers like packaging makers and pallet producers work through inventories.
Jon Tanner, chief executive of the Wood Processors and Manufacturers Association, said pallet makers in some parts of the country started the lockdown with seven to nine days’ supply of timber.
Pulp makers – producing for packaging and newsprint – will probably be getting through their log supplies by the third week of April, he said.
“We are going to have to start up parts of the industry pretty soon,” Tanner told BusinessDesk.
Processors and contractors have been working on safe work practices so they are ready “for any kind of amber or green light” the government provides, he said.
He said people need to understand the lead-times involved in re-stocking the industry supply chain, especially given recent calls for a fast resumption of construction work as well. That would require a deeper ramp-up of activity.
“The longer we leave it, the more of a shortage there is going to be,” he said.
The country’s sawmills and most of its pulp mills were shut last week in order to minimise the number of people working during the lockdown.
Norske Skog Tasman, initially told to shut by Saturday night, has an extension to keep making paper until April 12. Oji Fibre Solutions is concentrating pulp production at its Kinleith plant in order to supply packaging for the country’s food producers and exporters.
But as ports clear the last of the logs awaiting export, many of the country’s forest owners are anticipating a sharp increase in demand from their customers in China – this country’s biggest log market – as stockpiles there dwindle.
Forestry Minister Shane Jones told Newshub at the weekend that some form of local prioritisation may be needed to ensure local mills get access to wood.
The Ministry for Primary Industries has been coordinating efforts to keep the country’s key export businesses operating during the lockdown.
Julie Collins, who leads Te Uru Rakau – the ministry’s Forestry New Zealand arm, wouldn’t be drawn on a potential timetable for resuming limited harvesting.
She said the priority remained on producing shipping pallets, packing cases and other packaging for food, beverage and pharmaceutical supply.
“We are aware that some packaging companies have more than enough stock to cover their needs for months while others will need to be resupplied during the lockdown period,” she said on Friday.
“We are working closely with the pulp mills that are still operating and receiving regular updates on their stockholdings of logs and woodchip for paper and cardboard packaging production. At this stage indications are they have sufficient to cover needs during the lockdown.”
Tanner endorsed Jones’ comments on the need to ensure log supplies are managed as the country comes out of lockdown.
Demand in China is “just going through the roof” and some sort of export quota on logs may be needed to ensure local demand is met first, Tanner said.
The New Zealand forest industry is planning how to get back to work when restrictions on non-essential work are lifted for the industry - Organisations representing forest growers, transport, processing and contractors have set up a working group to develop risk assessment protocols in readiness for start-up of the industry sector.
The National Safety Director of the Forest Industry Safety Council, Fiona Ewing says the aim is to assure government that the sector will be able to comply with the epidemic management conditions of COVID-19.
“The priority and starting point is health and wellbeing.
“There is the complex technical side of start-ups that will be a ‘whole of industry’ scan of the value chain. That starts in the forest and moves through transport, processing and export through to the work at the ports. The group will be working with our stakeholders to get the start-up protocol proposal right.”
Fiona Ewing says the forest industry had accepted the government decision two weeks ago that forestry was a non-essential service provider.
“However, we now have clear guidelines on MPI approved safe practices from other parts of the primary sector that we are working to adapt.”
These protocols will provide the guidelines and will still require companies and individuals to adopt safe practices specific to their sector groups says Fiona Ewing.
“Our intention is to take the start-up protocol proposal directly to decision makers in MPI and Forestry Minister Shane Jones, so that the government is fully aware of the industry led recovery plan to re-activate the industry.”
Already there is also a fast growing call from New Zealand’s international customers to provide wood-based products that are deemed essential in their own countries.
“We need to act on this now. Even though the industry shut down in two days when lock down was announced, it will take much longer to get the forestry supply chain organised and moving again and advance planning will ensure a safe and successful restart.”
Source: BusinessDesk & Scoop
Thurs 9 April update - Forest industry pushing for restartAnother forester urges focus on restart, jobs - Forestry stands to be a major export earner in coming months and the country needs to focus on maximising those gains as the lockdown is lifted and harvesting resumes, IFSGrowth chief executive James Treadwell said.
Harvesting could have continued safely during the past two weeks and he said there is no reason for it not to resume on a regional basis where infection rates are low, suggesting the East Coast, Far North and central North Island as possible early contenders.
Pent-up demand for logs is strong in China, this country’s biggest market, but he said people need to remember that its economy is also likely to slow during the rest of 2020 as its major markets in Europe and the US struggle through the wake of covid-19.
Supplies of wood from Europe, where spruce beetle infestations are killing forests, will also start flowing into China again in the next six to 18 months, and that will also weigh on prices as they did late last year.
“There is no doubt about it that, come start-up, the export demand for logs will be high and the prices will be high – particularly from where they were,” Treadwell told BusinessDesk.
“But that export demand is definitely going to come down.”
Foresters and processors are pushing for a resumption of harvesting and production of all grades of timber to get sites working again and to meet expected domestic and overseas demand for logs, timber and packaging.
But Forestry Minister Shane Jones this week called for new measures, ranging from levies to a licensing regime, to ensure processors have access to affordable log supplies - ahead of exports – in order to help them survive during the expected tough year ahead.
IFSGrowth manages forests around the country and advises on forestry development. Its roughly 300 contractors aren’t working and the firm can continue paying them for only about two months, said Treadwell, who has also taken a 70 percent cut in salary.
Getting people working is key for the economy and it's important government measures don’t inadvertently restrict harvesting and slow the sector’s recovery, he said.
Supply for mills is important and many of the larger sites have long-term contracts to ensure wood flows.
But he said his company would struggle to advise small woodlot owners coming to harvest to accept a discount – potentially of $20 to $50 a tonne - to supply local mills rather than sending logs to export.
Expanding forestry and the country’s wood processing were key planks of the New Zealand First election campaign. Jones has overseen the government’s one billion trees planting programme, and wood processing has been a beneficiary of the government’s Provincial Growth Fund aimed at boosting jobs and capability within the regions.
This week he told BusinessDesk that expansion of processing has become more important to create new jobs and he is keen to help make that happen.
Private investors have plans to upgrade and expand some processing sites, but are being held back by the cost and risk of uncertain resource consenting processes, he said. He wants to see those barriers removed and is also open to co-investment by the Crown if that helps push projects ahead.
Wood processors tend to buy just under half the country’s annual harvest. But in recent years some have complained of not being able to get wood when international prices have been high. Some smaller, older mills have shut.
Treadwell said forest owners value the domestic market and are keen to see more processing developed. But he said the immediate priority needs to be getting as much of the sector working as soon as it safely can.
Covid-19 clusters in Bluff and Matamata meant that was unlikely to be in Southland or Waikato respectively any time soon, he said, but other regions should be able to resume work.
“We could have actually carried on harvesting and sending logs to the sawmills and the ports with all the social distancing that is required,” he said.
“Basically now, most people harvesting are working in a machine and they drive to work in their own cars and they tend to work in their own little bubble.”
Log Export UpdateThanks to the team at Champion Freight we have the latest log export update for you.
See today's graph for the latest statistics on our biggest wood market -- logs to China.
STOP PRESS - Shane Jones on log export banShane Jones considering ban on log exports so NZ has priority access to wood - Infrastructure Minister Shane Jones told Heather du Plessis-Allan he wants to help kiwis first.
The AWUNZ union has called for help to introduce forestry quotas and regulation to prevent "foreign-driven forest obliteration" after the lockdown.
The infrastructure minister may ban log exports so the wood can be used as a priority in New Zealand.
"How are we going to generate jobs in the Bay of Plenty and the East Coast and Northland if we don't have guaranteed access to raw material and a certain supply of logs."
To listen click here >>
STOP PRESS - Update on log export considerationsGovernment to consider levy on log exports to ensure home supply - Forest owners may face restrictions on log export volumes under a package of measures to be considered by senior government ministers next week.
Forestry Minister Shane Jones said the options include a levy on log exports to help fund the re-setting of the local industry; regulations requiring exporters to demonstrate that the needs of domestic processors have been met; and a licensing regime for major exporters, a key element of which would be a legal obligation to satisfy domestic demand first.
Jones said the measures are necessary to ensure that local processors can survive an expected spike in international log prices as demand in China and other major markets rebounds.
With the potential for unemployment here to reach 300,000, Jones said the government had to act to protect the existing domestic players so that there is a viable sector that can be expanded and more jobs created.
“Historic thinking is not going to cut the mustard in navigating our way through these turbulent economic waters,” he told BusinessDesk. “For two and half years, I have naively waited for the incumbent exporters and the domestic processors to come up with a solution themselves. They have been incapable of doing that, so next week we’re going to do that for them.”
Wood processors and forest owners have been readying themselves for a gradual ramp-up of activity as timber and wood pulp stocks are drawn down as a result of the national Covid-19 lockdown.
Exporters have also been keen to resume shipments of timber, logs and pulp, subject to new safe working practices, in order to meet pent-up demand from overseas customers.
Marty Verry, group chief executive of Red Stag Timber, said the rebound in international demand is a great opportunity for log producers and processors to benefit from. But he said the expected spike in log prices – coupled with a potential slackening in domestic demand later this year - could “crush” many sawmills.
“There’s a really good opportunity for New Zealand to get up and running and get a bit of a head start on the rest of the world,” he told BusinessDesk. “What’s important is that, with the fragile recovery, that the viability of the wood processors isn’t jeopardised by the huge spike in log prices that is coming. And that could last six months to a year or more.”
Less than half of the country’s annual forestry harvest is processed domestically, yet sawmillers have complained at times of not being able to get affordable stock when international prices have been high, as in recent years.
While some forest owners commit volumes to larger mills, others have complained that smaller mills haven’t been prepared to enter into term contracts.
The Red Stag mill at Waipa is the largest in the southern hemisphere and can process about 600,000 cubic metres of wood annually. Only about 20 of its 390 staff and contractors are on site currently.
Verry said there will be a jump in local demand as construction resumes post- lockdown in the June quarter, but he said the second-wave effects of the expected recession could see that drop off sharply in the second half of 2020 and into next year.
In that environment, processors would need “reasonable and relatively stable” log prices to keep operating to fill domestic and international orders.
He said some sort of domestic quota made sense, but the government and councils would also need to bring forward as much construction work as possible to fill the “big hole” likely in construction demand later this year as firms close and projects are halted.
The government should also prioritise its policy commitment to use more wooden construction in state-owned projects.
Verry said government intervention on log supply was appropriate given the pandemic has the potential to deliver “super-normal” profits to log exporters, but impose huge costs on domestic processors.
“A lot of the spike is driven by the pandemic, which is dropping shipping rates and dropping the currency, which means that New Zealand foresters are going to make pandemic-driven super-normal profits.”
He’s happy they can do that, after sufficient supply is set aside for mills.
“They can fill their boots - above and beyond what New Zealand needs.”
Forest Owners Association president Phil Taylor said Jones’s proposal can’t work as log supply for domestic and export markets is inextricably linked.
“We just can’t go in and cut down some parts of a tree to cater to one market without harvesting the whole tree for other markets too. That was clearly shown up when forest companies were unable to export earlier in the year and how difficult it physically was to keep our local mills supplied.”
Taylor said the industry needs both a healthy domestic market and a healthy export market, and the proposed restrictions could hurt sector incomes just when they are needed most.
Jones said he and the other four ministers of the forestry reference group – James Shaw, Eugenie Sage, David Parker and Damien O’Connor – will consider the proposals next week. Subject to their approval, a Cabinet paper could be ready by the end of next week.
About 70 percent of the country’s forests are owned by major international funds and private investors, with the balance largely in Maori and farm forestry ownership.
Jones said a threshold would probably be needed in the regulations to avoid capturing smaller woodlot owners.
And he said the risk the restrictions may damage New Zealand’s reputation with international investors was less of a concern than keeping the domestic economy working. If forest owners had concerns, they should spend their Easter break coming up with a better solution, he said.
STOP PRESS - Won't work say forest ownersForesters are saying that log supply to domestic and export markets is inextricably linked and can’t be separated, as Forests Minister Shane Jones now seems to be advocating.
Forest Owners Association President Phil Taylor says a harvest of just about any forest will produce higher grade logs for domestic construction, some logs for export and some lower value wood which is only suitable for domestic chipping.
“We just can’t go in and cut down some parts of a tree to cater to one market without harvesting the whole tree for other markets too. That was clearly shown up when forest companies were unable to export earlier in the year and how difficult it physically was to keep our local mills supplied,” Phil Taylor says.
“It’s not true either that we send all our logs overseas. In most years, the majority of the export value of our forest products comes from added value categories, such as sawn timber and pulp and paper.”
“About 15 million tonnes of logs a year are consumed by our domestic processors and this represents just under half of the total annual harvest from New Zealand’s forests. That has been remarkably consistent and a welcome market for us over the past twenty years.”
“Of course, at the moment most of the industry is closed down in support of the government aim of ending the COVID-19 infection crisis. We have supported this measure,” Phil Taylor says.
“But the shut-down has meant we are getting increasing reports of tens of thousands of tonnes of logs left deteriorating on harvest sites and in yards around the country, which urgently need to be exported or processed before they are worth nothing.”
“When we do get back to business, we’d welcome new infrastructure projects the government says it intends to generate to get the economy going. It would be tremendous if wood construction was a major part of that,” Phil Taylor says.
“It would also be great if some of these wood dependent projects could be in the regions. That would help those communities which grow, supply and process these logs. The forests are often in regions where other employment opportunities are generally scarce.
“We are concerned for the forestry workforce in our rural communities. They have felt the market effects of Covid-19 right back to the beginning of this year, well before the shutdown began.”
“Any restriction on exports has the potential to severely impact their well-being and that of their families.”
“Shane Jones is talking about creating new jobs. We’d love to see those, but not if we fail to protect current ones.”
“We need a sustainable domestic market for our logs in New Zealand, just as we need a healthy export market.”
The Chief Executive of the Forest Industry Contractors Association Prue Younger says contractors as an industry sector will want to get back to work as quickly as possible, whether it be export logs or domestic processing.
“Both offer opportunity to return our contractors to financial viability.”
“Ultimate stability with the right product balance needs to be the medium term vision where retention of a skilled workforce are seen pivotal in the supply chain. Otherwise once again they hold the greatest risk as has become apparent through recent episodes of low log prices and the COVID19 crisis,” Prue Younger says.
Phil Taylor says if the export market was restricted it would most likely mean that less timber would be available locally.
The Farm Forestry Association shares Phil Taylor’s concerns.
President, Hamish Levack says he doesn’t know what Shane Jones is actually proposing.
“If the government introduced compulsory acquisition at low prices for instance, then I suspect most farm foresters, because they are not going to harvest at a loss, would shut up their woodlots and wait for a change of government. Our sector represents 40 percent of the currently harvestable trees.”
Phil Taylor says he doesn’t think some iwi would be very pleased either.
“That is something of course that they might wish to speak for themselves about. Land owned by iwi which is growing commercial forests on it represents another 40 percent of the New Zealand forest estate, and Māori outside of the iwi estates own forests in their own right too.”
Phil Taylor says the industry has also been pushing for the Labour led government to fulfil its election promise of a wood preference policy in construction.
“Ever since the government was elected, we have been trying to get Labour to prioritise New Zealand wood use over high carbon emission materials, such as mostly imported from overseas steel and concrete. It hasn’t happened unfortunately.”
“We would hardly be pushing for this policy if we wanted to keep logs for export.”
“If the policy had come in during 2017, when it should have, we’d be well on the way of using a New Zealand grown resource being available for New Zealand workers to construct with when the COVID-19 lockdown ends,” Phil Taylor says.
‘As it is, it’ll will take years to grow New Zealand timber processing, while our immediate need will be many jobs to be available when the lockdown ends.”
“Right now, we cannot afford to take an everyone for themselves approach. It is even more important than ever for all parts of our supply chain work together which can deliver solutions that are the best for all.”
Source: NZ Forest Owners Association via Scoop
Kawerau tissue maker confident of supplyTissue maker confident of fibre supply amid forestry lockdown - Asaleo Care said it has put on additional production shifts to ensure ongoing supplies of toilet paper and other products as the national lockdown halts forestry harvesting.
The company’s brands include Purex, Libra, Handee and Treasures. Its mill at Kawerau is the country’s only producer of tissue, which is made with both local and imported wood pulp.
David Griss, the firm’s corporate services executive general manager, said the business has no concerns about supply arrangements for the short to medium term.
Kawerau is operating 24 hours a day, seven days a week, he said, while the firm’s Te Rapa plant is also operating to meet an increase in demand for the firm’s Treasures products.
“We are doing all we can to respond to the increase in demand including adding additional production shifts to maximise use of our available manufacturing capacity,” Melbourne-based Griss said in an email.
Log harvesting and timber processing has been halted as part of the lockdown to contain the spread of covid-19. Oji Fibre Solution’s Kinleith plant is the only pulp plant still operating and remaining pulp stocks are being directed into essential products, including food packaging and newsprint.
Magazine publisher Bauer Media Group, not classed as essential media for the duration of the lockdown, today shut its doors and sought buyers for its titles.
Paper maker Norske Skog is trying to get an extension to keep operating its plant, also at Kawerau, beyond the April 4 shutdown currently scheduled. It wants to avoid shutting the plant completely if it can, instead slowing production until April 12 when it expects to have used up existing stocks.
The country’s wood processors are working with the Ministry for Primary Industries to manage remaining wood stocks and determine how and when harvesting may resume. Supplying cardboard for export fruit packaging and domestic foodstuffs, and timber for pallets and fruit bins, remains the priority.
Pan Pac Forest Products operates a sawmill and export pulp operation at Whirinaki, north of Napier, most of it supplied from its own forests. Chief executive Tony Clifford said the firm is focused on the welfare of its staff and isn’t pushing for a resumption of harvesting.
Pan Pac probably has about a month of wood on site available for pallets and bins for its key customers, and the level of inventories nationally should be clear by the end of next week, he said. But he said restarting sawmills to produce only one or two products would be challenging.
Wood chip could go to Kinleith, but it would be hard for Pan Pac to produce affordable packaging-grade timber without the higher-value grades that the firm makes for mouldings and other building components. Bridging that price differential would not be easy and some other form of “economic intervention” may be required, he said.
Logger enjoying family time and sleeping inWhanganui logger Harley Pomeroy is enjoying his forced holiday according to this story from TVNZ late last week - The lockdown has seen logging company owner Harley Pomeroy trade his 3am wake-up and trudge into the dark forest for a 'sleep in' and cuddles with his three young daughters.
"I have been in the bush for 23 years and I work between 70-90 hours a week and to actually wake-up at half past five in the morning and having my kids in bed with me - you can't beat it," he said.
Source: RNZ and TVNZ
New mill map now availableThis story was so popular last week, we've decided to run it again.
Every two years we highlight who's who in Australasia’s wood processing and manufacturing industry on our popular FIEA Forest Products Industry Map. Our 2020 map has just been printed.
This is our fourth edition of the full colour 980mm x 680mm map. It features 171 wood processing operations including over 65 sawmills cutting in excess of 25,000m3 sawn lumber per annum (with sawn production levels), all fibreboard, particleboard, plywood, pulp & paper, veneer/LVL/CLT, paperboard and chip export operations along with major wood manufacturing operations.
Since the last edition produced in early 2018 there have been over 50 major updates to mill locations, ownership and production. Changes in the last two years have indeed been significant. Our new map is now the most up-to-date industry reference providing an essential mapping resource for New Zealand and Australian forest products companies.
A folded copy of the map will be inserted into FIEA's industry partner magazine issues in April/May. But they often disappear from the magazines quickly, so you can purchase your own folded or flat laminated copies of the new map now before we sell out.
So, you can place your own orders now on the FIEA website (www.fiea.org.nz) or by clicking here.
Note: Orders are being taken now and the maps will be posted as soon as we can.
Scion: Transparent wood film recognisedA new development by wood researchers at Scion received acclaim at this year’s virtual Timber Design Awards - A transparent wood film, made by a Scion team, was highly commended in the Wood and Fibre Products Technology and Innovation category in the 2020 Resene Timber Design Awards.
The novel wood is ultra-strong, flexible and 80% transparent. The process is simple – a chemical treatment removes lignin/hemicellulose from thin layers of wood that are compressed and dried.
The material becomes 20 times thinner and 25 times stronger than the original wood and mechanically stronger than most materials (strength-to-weight) such as steels, alloys and plastics.
Directly derived from wood, it can be produced sustainably and is easily recyclable or biodegradable. The functionality of the material’s surface can be modified by printing or coating, with organic nanoparticles or hydrophobic molecules, for example.
Qiliang Fu, who is a wood and fibre scientist, says preserving the original orientation of the cellulose fibres gives the translucent wood strength and allows it to be flexible.
“Wood is made up of strong and flexible cellulose chains glued together with lignin and hemicelluloses. We wondered if we could remove lignin and hemicellulose but leave the cellulose structures intact – similar to the papermaking process. And could it be made using traditional paper making infrastructure, like a continuous roll-to-roll process, for example.
“We have actually made a wood-based electronic circuit from the translucent wood and conductive containing carbon fibres derived from lignin as part of a collaboration with my Scion colleague, Dr. Yi Chen,” says Qilang.
“This shows the potential for using wood-based flexible electronics in other areas such as wearable devices, smart packaging and sensors.”
“Transparent, flexible wood film could replace petroleum-based plastics and reduce our reliance on non-degradable polymers in our daily life.”
The first samples were made with balsa wood. The team is now working on exploring the use of New Zealand-grown wood such as pine and eucalyptus, as well as alternative chemical treatments (e.g. wood bleaching and traditional pulping approaches) to make new transparent wood films.
The New Zealand Wood Resene Timber Design Awards showcases the innovative, structural and aesthetic use of timber by New Zealand architects and engineers. The event allows engineers, architects, architectural designers and builders to showcase innovation using timber.
The Wood and Fibre Products Technology and Innovation category is open to novel wood, wood fibre and derived products or for novel technology and process development, or original application of existing technology and processes.
Photo: From top to bottom: original balsa wood; treated wood; transparent wood film.
Union: Hoping for a miracleUnion leader Maurice Davis was quoted in the media on Friday saying: “Shane Jones says he is the regional saviour. He must urgently introduce forestry export quotas and regulation to prevent a foreign driven forest obliteration.”
“He needs to inform log exporters that Kiwi processing firms outrank their overseas appetites. NZ forest sector is too reliant on China. We need to look after Kiwi jobs and timber firms before we fuel the Shanghai Express.”
“I fear an avalanche of logs for short-term profit will disappear overseas to the detriment of Kiwi manufacturing and construction jobs. The old free market model of beggar thy neighbour is discredited.”
“The absolute priority must be looking after Kiwis bank balances before foreign forest owners. Kiwi jobs and regional families will be Shane Jones voters; if he does not stop the foreign forest felling the voters will cut him down.”
Canada to tag trucks electronicallyElectronic logging devices expected to become mandatory next year in Canada
FPInnovations announced that a new federal mandate is expected to come into effect next year making electronic logging devices (ELDs) mandatory for federally-regulated motor carriers and their drivers.
With few exceptions, anyone who currently uses paper logs to keep track of their hours behind the wheel will need to use ELDs beginning in June 2021.
Some East Coast farmers in carbon bubbleThe following story appeared this week in the NZHerald. From the reporter's naive reporting it appears some farmers in the region have only just discovered the existence of carbon credits, and the news has them fuming because their farming bubble might just burst.
Local Focus: Wairoa forestry 'scaring the hell out of this community' - It wasn't far from anyone's lips at the recent East Coast Farming Expo - big money being paid for farms, with Wairoa District getting more than its fair share of forestry because its land is suitable and at the right price.
The trend, from pasture to plantation, is accelerating thanks to trees being eligible for carbon credits. The credits can be sold in advance for good money, offsetting pollution through the Emissions Trading Scheme (ETS).
Wairoa Mayor Craig Little said farming no longer outpaced forestry in Wairoa.
"Probably eight or nine years ago I thought we had got over this forestry speed hump and farmers were outbidding foresters," he said. "The Billion Trees [programme] has come along but it's not the issue - it is these carbon credit farms that are going in.
"They are not going through the Billion Trees because you have to give some of your carbon away. So they are planting these forests, never to be harvested."
Forests planted without provisions for harvesting leaves land that may never be worth the effort of replanting or re-pasturing because of the cost of removing the low-value wood and loss of farming infrastructure.
Little said more than 7 per cent of Wairoa farmland has been sold into forestry over the past six months. If much more goes the same way, he said, it would mean fewer jobs, fewer communities and fewer farmers spending their money in town.
Sweden: Who owns the forest?The forest area of Sweden is 23,5 million hectares or 58 % of the total land area, as we wrote in the first article in this series, Swedish Forestry #1. But who owns it? Well, let´s try to sort that out.
The owners in figures
In 2017 there were 319 649 forest owners (persons) of which 38 % were female, 60 % were male and 2 % were of unknown gender. 7 290 of those forest owners were non-Swedish. The number of units was 224 888 the same year. Of those 67 % were owned by persons who lived on their estate, 26 % lived somewhere else and 7 % lived on one estate, and in the meantime owned other estates.
The distribution of the forest land in 2017 was as follows:
48 % individual owners
24 % private owned limited liability companies
13 % state-owned limited liability companies
6 % other private owners
7 % state owned forest
2 % other public owners (churches etc.)
Forest owners’ associations
There are three forest owners´ associations in Sweden today (until recently there were four, but the two northern ones incorporated and became Norra Skog “North Forest” in March 2020).
It all started in 1906, in Dalarna, in the middle of Sweden. “The idea is to be stronger together without personal responsibility.” The small forest owners had suffered under long term contracts that had been dictated by the forest industries. According to the contracts, the forest owner had no, or very few, rights to their forest land during the 50 years of the contract that was common. In the contracts, there were as good as never any obligations to reforest the land after the forest had been cut.
The purpose of the associations was to make sure that forest owner´s rights were taken into consideration and to make sure that the members got the right value for their forests, meaning that the forest land should be profitable for its owners. Together, the possibility to affect the prices for wood was better than it was for single forest owners.
A large number of small forest owners´ associations were founded all over Sweden during the upcoming decades after 1906. Today there are three major associations:
Södra 52 000 members (in the south of Sweden)
Mellanskog 26 000 members (in the south and mid-Sweden)
Norra Skog 28 000 members, (in the north. Until recently this was two associations; Norra Skogsägarna and Norrskog))
Who buys the wood?
In total there are quite a few wood buyers in Sweden. Small private-owned sawmills, large industry groups and the forest owner associations who have their own industries. As a matter of fact, in south Sweden Södra is the largest forest industry group with a number of both saw- and pulp mills.
Stora Enso, Holmen, SCA, Sveaskog, Billerud Korsnäs, Derome and Vida are some of the larger forest industries apart from the forest owners’ associations and all the private sawmills. This diversity of buyers, especially in south Sweden, makes the wood market the sellers, the forest owners, market which also shines thru on both woodland- and wood prices. Forest land is, however, seen as a very good investment, despite the high purchase prices.
The typical forest owner
I´m not sure if there is a “typical forest owner”. A forest owner in Sweden today could be anyone: A farmer, an investor, a lawyer, an accountant, a banker, a hunter or a factory worker. It could be someone who inherited some forest land, someone who bought it because they like the countryside, someone who likes horses, someone who wants to live in the forest or someone that lives in a city. There are lots of reasons to own a forest. Here below we will present three forest owners with slightly different goals with their ownerships.
Treemetrics - the passing of timeThis was me 14 years ago with Treemetrics Ltd first 3D (Lidar) laser scanner. The scanner was a 15kg lump of metal and it cost a whopping €65,000.
2 weeks ago in the midst of the upheaval Apple announced that the latest iPad Pro had a built in Lidar (3D) laser scanner. The new sensor works to a limited range of 5M but but from initial assessment it collects high quality 3D data in an outdoor environment.
We are convinced that this will revolutionize #Forest measurement and log pile volume assessment. @Treemetrics will be working hard over the coming months to re-purpose our original processing software to enable this new world. Stay tuned for updates and connect with me if you are interested in partnering or supporting in any way.
- Enda Keane, CEO, Treemetrics
Buy and Sell
The hills may be closed to us, but this remake of a classic is here to brighten your screens!
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