WoodWeek – 4 May 2022

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Welcome to your good wood news source. Consultation is now closed on the Government’s proposal that exotic trees in permanent forests would not be eligible to earn and sell carbon units. The proposal followed rural community protests against farm-to-pine conversions and Climate Change Commission recommendations favouring native forestry over exotics in the long term.

If the proposal holds, only native permanent forests and exotic harvested forests will be eligible to earn carbon units under the Emissions Trading Scheme (ETS).

Moving to decisions affecting log exports, we begin with a quick recap. In August 2021 a decision on the Reassessment of methyl bromide for fumigation of logs was released by the EPA. This was followed more recently by the release of the decision approving the use of EDN in mid-April 2022.

Both processes had taken considerable time and resource, methyl bromide almost 2.5 years and EDN almost 5 years. To maintain trade of logs with some countries, fumigation treatments are required. Over 71% of all logs exported from NZ are now treated with in-transit, in-hold fumigation using phosphine. China is the only market that accepts phosphine as a treatment with over 14 million tonnes being treated this way last year. The ability to increase the phosphine treated volume is close to maximised unless there are significant changes to ship types or a reduction in top stow logs carried as phosphine is restricted to underdeck treatment as it requires 240 hours to complete the fumigation.

China also accepts debarked logs and methyl bromide treated logs. In 2020, debarking was applied to about 9% of logs exported and the balance was treated with methyl bromide.

New Zealand has never been more exposed to China as a market for our goods, but we may have more of a buffer against the impacts of a trade disruption than many appreciate. That's according to a report from the New Zealand China Council released last week. The log export trade is rated in the report as one of the most-exposed of our New Zealand commodity exports.

In more positive news, a farm forestry road show rolling out across the central North Island in late May will be an opportunity for hill country farmers to find out how they can integrate trees into their farming systems. The New Zealand Farm Forestry Association (NZFFA), supported by Te Uru Rākau – New Zealand Forest Service, is holding a series of workshops in Taranaki, Rangitikei, and Wairarapa.

Subjects covered in the workshops will include species choice, how and where to grow trees, and the benefits of trees to a farming business. Each workshop will be followed by a half-day visit to a working example of farm forestry.

Almost finally and “ya woodn't read about it wood ya?” Pallet wars: Wooden pallet prices soar in Europe while stock dwindles - The war in Ukraine has claimed a new collateral victim in Europe: the market for wooden pallets – crucial in the packaging, handling and storage of goods. According to the European Pallet Association. (EPAL), more than 600 million of its pallets and 20m of its box pallets are in circulation.

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Maori: Opportunity lost if no pine for carbon

Moves to limit pine would force landowners, Māori to forego ETS cash -The once-unpopular pine tree has received fresh support – particularly from Māori landowners – after the Government moved to limit planting.

In a public consultation, the Government proposed that exotic trees in permanent forests would not be eligible to earn and sell carbon units. This followed rural community protests against farm-to-pine conversions and Climate Change Commission recommendations favouring native forestry over exotics in the long term.

If the proposal holds, only native permanent forests and exotic harvested forests will be eligible to earn carbon units under the Emissions Trading Scheme (ETS).

Yet farm-to-pine opponents appear to have been comparatively silent during the consultation, while exotic forest proponents including Māori leaders have expressed their strong disapproval of the idea, which would affect the amount of money that landowners could earn on marginal land.

The consultation document highlighted concerns that widespread, lower-cost carbon units from forestry could keep carbon pollution higher. “The resulting increase in the supply of [carbon units] to the NZ ETS from these forests is likely to dampen medium-term carbon prices… This risks curtailing investment and uptake of low-carbon technologies to reduce emissions.”

The proposal will significantly affect the Māori economy. Ngā Pou a Tāne, the National Māori Forestry Association estimates the cost is $7 billion – yet the Government has failed to properly consult its Treaty partner, said Ngā Pou a Tāne chair Te Kapunga Dewes​.

“[The Government] hasn’t talked to us about it. It’s given us five weeks to round everybody up who’s affected by this… And this permanent category was only agreed last year, and now we’re doing it again.”

By sharing the concerns about exotic forests, could ministers have partnered with iwi to find a solution that was workable for everyone?

“Had the Government – and dare I say it’s their obligation – facilitated a conversation in that space then Māori would have absolutely participated. But when the government consults, the most they do is put out a few webinars, without compensation, without resource.”

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Source: Stuff news





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STIMBR: Background to EDN decisions

Decisions on Methyl Bromide and EDN - In August 2021 a decision on the Reassessment of methyl bromide for fumigation of logs was released by the EPA. This was followed more recently by the release of the decision approving the use of EDN in mid-April 2022.

Both processes had taken considerable time and resource, methyl bromide almost 2.5 years and EDN almost 5 years. To maintain trade of logs with some countries, fumigation treatments are required. Over 71% of all logs exported from NZ are now treated with in-transit, in-hold fumigation using phosphine. China is the only market that accepts phosphine as a treatment with over 14 million tonnes being treated this way last year. The ability to increase the phosphine treated volume is close to maximised unless there are significant changes to ship types or a reduction in top stow logs carried as phosphine is restricted to underdeck treatment as it requires 240 hours to complete the fumigation.

China also accepts debarked logs and methyl bromide treated logs. In 2020, debarking was applied to about 9% of logs exported and the balance was treated with methyl bromide.

Debarking volumes continue to grow, and methyl bromide volumes continue to decline as shown below when measured in percentage terms, but when considered in volume terms, the decline of methyl bromide is not as pronounced due to rising export log volumes.

Even with these decisions now announced, it is probable that fumigation using methyl bromide or EDN will only be permitted at Tauranga and Northport, unless off-port facilities are established elsewhere.

Methyl Bromide - The key operational points from the Reassessment Decision were around increased buffer zones when fumigating and increasing requirement to recapture methyl bromide after completion of the fumigation.

Of particular importance was the need for extensive buffers (900 metres) around any ship hold fumigation with methyl bromide. As this is impossible to achieve (given this extends both outside the Port boundaries on the landward side and into the marine environment on the seaward side), all fumigation of ships holds effectively ended shortly after the decision last year.

This has far-reaching effects and has resulted in an almost complete cessation of log export to India from New Zealand as methyl bromide is the only treatment accepted by Indian Authorities. This also means over 90% reliance on China as a market for our logs.

Recapture of gas remaining after fumigation under tarpaulins is being further developed by Genera and is likely to allow ongoing use of methyl bromide for the next few years at least, but with increasingly tighter requirements and the need to adequately destroy, recycle or reuse the methyl bromide recaptured.

Globally, efforts to reduce methyl bromide use have been ongoing for decades due to the adverse impact of the gas on the ozone layer. While use is restricted to phytosanitary activities some jurisdictions have also moved to ban its use completely.

STIMBR has shown that considerably lower rates of methyl bromide will achieve the same phytosanitary results, but to date, importing countries have yet to accept these results and change their requirements. Acceptance of these lower application rates would increase the ability to recapture the remaining gas and to reduce the environmental impact if its use.

EDN - On 12 April 2022 the EPA released the long-awaited decision on the registration of EDN as a fumigation chemical for export logs. STIMBR and the Applicant, Draslovka have invested heavily in the process over the past 5 years but are pleased that the decision is reasonable, workable and logical.

The decision allows EDN to be used at up to 120 grams/m3 for under tarpaulin and shipping container fumigation operations without recapture of any gas remaining at the end of the fumigation process. Commercial scale testing has shown that rates lower than 120 grams will achieve the control required of the treatment so actual application rates may be lower in practice.

The decision also provides details of records to be maintained, buffer zones, weather conditions and a range of controls for the use of EDN. Importantly, these controls and requirements are similar to current requirements for methyl bromide fumigations and are considered both reasonable and workable.

The decision did not allow fumigation of ship holds nor, interestingly, despite a request from MPI, did it allow EDN fumigation for imports. Applications seeking reassessments to permit these activities are being considered.

EDN has the potential to replace methyl bromide for export log fumigation where it is approved by importing countries for inclusion in their treatment schedules. MPI is responsible for negotiating these approvals and has talks underway with both India and China.

Methyl bromide has been used successfully in this role for decades and is widely accepted as an effective fumigant. Any replacement needed evidence to demonstrate its effectiveness to achieve the desired outcomes.

EDN is proven against the pest species of concern on export logs, does not require recapture and is used in a manner that is like methyl bromide.

While EDN is now registered for use in NZ on exports, there remain some hurdles to overcome, the most significant being the need to gain importing country approval of EDN as a phytosanitary treatment and internally in NZ, ensuring there are fumigators to use the product with required Resource Consents specific to each port. Work with trading partners (India and China) has been ongoing for some time, The release of this decision adds new impetus to these negotiations.

STIMBR is extremely pleased to have a proven alternative to methyl bromide that is environmentally more friendly and is not difficult or more costly to use, so that the trade in export logs can continue. The need for additional phytosanitary tools has become even more apparent with the removal of the trade with India and the limited capacity to debark all the volume that would have been previously treated with methyl bromide.

Source: STIMBR





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China trade: Over-exposed or cashing in?

(BusinessDesk) New Zealand has never been more exposed to China as a market for our goods, but we may have more of a buffer against the impacts of a trade disruption than many appreciate. That's according to a report from the New Zealand China Council released last week.

The log export trade is rated in the report as one of the most-exposed of our New Zealand commodity exports (see graphic).

In the event of trade disruption with China, those goods on which China relies on NZ for supply would likely still flow, while other goods which are more easily replaced by China or less essential could be redirected to other export markets, the council said.

Therefore, opening up new export markets through trade negotiation was the most prudent way of "supporting optionality for exporters".

Additionally, China offers NZ a large and growing market for primary goods that is not easily replaced, the report said. NZ China Council chair John McKinnon said China would continue to be a key market for NZ exporters, despite the possibility of a covid lockdown creating an economic downturn.

"The Chinese economy is going to have its ups and downs, but it is going to be a significant economy in the world and there are going to be people there who are going to want to buy the things that we produce," he said.

Big but not unprecedented - China accounted for 33% of all NZ's goods exports in 2021, up from 25% in 2018 and 13% in 2011. The increased concentration is a result of a 20% growth in goods exports to China combined with declines in other markets such as the UK and Australia.

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Source: BusinessDesk
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Minister: Change could stop communities destruction

Farmers fearing for the “destruction” of rural communities by carbon credit pine forests want to see a plan from the Government to improve things in areas where farming jobs have disappeared.

With many New Zealand farms having been converted to forestry due to rising carbon prices in recent years, feedback last week closed on a proposal to change settings in the Emissions Trading Scheme, where permanent plantings of exotic forests, like pine forests, would be excluded from the scheme from next year.

Damien O’Connor, the minister for trade and agriculture, fronted up to a packed Pongaroa Hotel in rural Tararua on Tuesday night about the changes. He said they would move to stop permanent forests being pine trees, that should instead be native trees.

The passionate crowd aired their concerns about what forestry has done to the sheep-and-beef farming area, as recently many farms have been converted to carbon credit pine forests, leading to a loss of farming jobs.

For more information on this research, click here

Photo: Trees planted near stockyards west of Pongaroa


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Tigercat develops purpose-built forestry dozer

Tigercat Industries has developed a forestry dozer. The new TCi 920 will be making the rounds at several US forestry industry tradeshows this spring.

The dozer will be branded under the new TCi badge, as Tigercat Industries continues to design machines for applications beyond forest harvesting systems. All products falling under the TCi brand are, and will continue to be designed, manufactured, and supported by Tigercat Industries.

Seeking to overcome shortcomings that harvesting professionals have experienced when applying standard-build, mass production dozers to forestry operations, the new 920 is designed specifically for use in logging applications.

The 920 is powered by the Tigercat FPT N45 Tier 4f engine rated at 101 kw (135 hp). It is equipped with a 190 mm (7.5 in) pitch heavy duty undercarriage, a responsive and efficient closed loop track drive system, strong, impact-resistant belly pans, and durable structural components throughout. The 920 provides the power, durability and versatility for deck clearing, road building and clean-up activities on logging sites.

The carefully designed forestry cab offers the operator clear sightlines augmented by the sloped front hood and rear-mounted exhaust. The cab is quiet and comfortable with a heated and cooled air ride seat, ergonomic armrest mounted joysticks, and a large touchscreen machine control system interface.

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Source: Tigercat



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Farm forestry experts offer free workshops

A farm forestry road show rolling out across the central North Island in late May will be an opportunity for hill country farmers to find out how they can integrate trees into their farming systems. The New Zealand Farm Forestry Association (NZFFA), supported by Te Uru Rākau – New Zealand Forest Service, is holding a series of workshops in Taranaki, Rangitikei, and Wairarapa.

Subjects covered in the workshops will include species choice, how and where to grow trees, and the benefits of trees to a farming business. Each workshop will be followed by a half-day visit to a working example of farm forestry.

NZFFA president Graham West says the workshops will help farmers to make informed decisions on whether woodlots are a good fit for their farming business.

"Trees are not an alternative to farming, but a complementary land use that can help strengthen a farm's long-term growth and prosperity," Graham West says.

"Planting trees protects against erosion and increases biodiversity by providing shelter and habitat. The Emissions Trading Scheme offers additional revenue to farmers wanting to plant woodlots within parts of their farm."

"Beef and Lamb have acknowledged the importance of integrating tree planting and it's important to continue the good work," says Alex Wilson, director forest development, grants and partnerships at Te Uru Rākau – New Zealand Forest Service.

"Te Uru Rākau – New Zealand Forest Service are working with local communities and stakeholders to integrate trees into existing land-use and look at the potential for planting trees on unproductive, or erosion prone land," Alex Wilson says. "Planting trees is also an important part of the Government's climate response – trees sequester carbon and are an effective means of helping meet our emissions reduction targets."

"The Farm Forestry Association are experts in combining farming and forestry, and it is great to be able to partner with them to promote these workshops," Alex Wilson says.

Workshop dates and venues:
The workshops consist of a morning (8.30am to noon) and afternoon (1pm to 4.30pm) session, with a half day field trip the following morning. The workshops are free of charge and lunch is provided. Participants can choose to come to one or more of these sessions:

Hawera, TSB Hub – Tuesday 24 May
Bulls, Community Centre – Thursday 26 May
Copthorne Solway Park Hotel, Masterton – Monday 30 May.

RSVP to trees@nzffa.org.nz
Spaces are limited so register today.


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Ponsse takes big hit from conflict

As with many aspects of trade and commerce, it takes a disruption to remind most of us how interconnected everything is. Here is another example of how the Russia-Ukraine war has affected international forest machine manufacturer Ponsse.

Due to war in Ukraine, Ponsse removes orders from Russia for Euro 109 million from order book Russia has been the world’s largest market for CTL machines, accounting for 20% of Ponsse’s net sales in 2021. Its Russian subsidiary OOO Ponsse has been the largest business branch of the Ponsse Group.

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Russia to start own certification scheme

FSC office in Russia terminates relations to FSC International to start Russian certification scheme - As stated in the statement of the employees of the FSC office in Russia, the new certification system "Forest Etalon" will allow preserving all the best that has been accumulated over the years of FSC's work in Russia. If FSC International activates the Russian FSC FM/CoC and CoC certificates again, the temporary scheme will cease to operate.

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Source: Lesprom
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Stora Enso exits Russian operations

Stora Enso said it is divesting its two sawmills and forest operations in Russia to local management. Finnish paper and forestry company Stora Enso has entered an agreement to divest its two sawmills and forest operations in Russia to local management, the company said recently.

As a result of the uncertainties of the Russian market, “local ownership and operation can provide a more sustainable long-term solution for these business operations and the employees working there,” Stora Enso said.

The two sawmills, located in Novgorod and Karelia, in the western and northwestern parts of Russia respectively, together employ a about 332 workers, according to the company. Both sawmills produce a range of timber and pellets. Stora Enso’s forest operations employ about 170 workers, through which it supplies wood to the sawmills, the company said.

Stora Enso’s deal is expected to conclude in the second quarter of this year and won't have a material impact on its annual sales, the company said.

The company had already halted all production and sales in Russia on March 2, about a week after Russia invaded Ukraine on Feb. 24. Stora Enso said it is in the process of finding “a sustainable solution” for the future of three packaging plants in Russia.

Souce: The Wall Street Journal



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... and finally ... this is no joke, supply chain problems

MEMO from our Jokes Department: We apologise, but due to supply chain disruptions, we are out-of-stock just now, check back soon!

Just kidding, here's a few we dusted off from the back of the funnies warehouse:

If you replace the W with a T in what where and when, you get the answer to all of them.

When I was young, I was extremely poor; however, after many years of hard work, I am no longer young.

I used to be in a band called The Hinges. We supported The Doors in the 60s.

I bought a new laptop; all it did was play a song where this lady kept singing about "Someone Like You".
I phoned tech support; they reminded me I'd bought a Dell.(say it out loud)

David Hasselhoff walked into a bar and ordered a beer.
The bartender said: “It’s a pleasure to serve you Mr. Hasselhoff.”
“Just call me Hoff,” said the actor.
“Sure,” said the bartender. “No hassle.”

A very philosophical friend asked me "What is Earth without art?"
I just looked at him and said "Eh?"

Spotted on Twitter last week:



That's all for this week's wood news.

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John Stulen
Editor
Innovatek Limited
PO Box 1230
Rotorua, New Zealand
Mob: +64 27 275 8011
Web: www.woodweek.com

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