Victoria's Native Forests Sold for Cents
1/27/99
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Title: Victoria's Native Forests Sold for Cents
Source: David Syme & Co 1999
Status: Copyrighted, contact source to reprint
Date: 1/27/99
Byline: Claire Miller
The Kennett Government has been selling off woodchipping rights to
Victoria's native forests for royalties of as little as nine cents a
tonne.
The revelation, contained in a document obtained by The Age, will add
fuel to claims that the Government has been propping up the logging
industry at the expense of alternatives such as plantations and
recycling.
In an indication of the value placed on forests by the State Government,
a confidential letter to the Newmerella Logging Company in East
Gippsland - one of the largest mills in the state - sets
royalty rates ranging from nine cents a cubic metre to a high of $1.38.
A cubic metre of wood weighs roughly one tonne.
By comparison, the National Association of Forest Industries estimates
the price for equivalent low-grade plantation logs at between $8 and $10
a cubic metre.
Critics claim low royalties on native forest logging amounts to a
subsidy, which is pricing environment-friendly alternatives such as
plantation timber and recycled paper out of the pulp market.
The letter from the Department of Natural Resources and Environment sets
the company's royalties for 1997. Newmerella's director, Mr Trevor
Andrews, said yesterday that royalty rates had risen by about three or
four per cent since then.
Ms Serena Williams, a spokeswoman for the Conservation Minister, Mrs
Marie Tehan, said last night that timber prices were audited by the
Auditor-General, whose reports were publicly available.
But the Newmerella revelation is likely to harden the opposition of
conservationists to the Regional Forests Agreement process. Community
and green groups argue that the agreements, which lift export limits on
woodchips, are propping up the industry and have resulted in
unsustainable logging. Sustainable yield limits are set on sawlog
volumes, but not the ``residual'' logs that are chipped for paper
products.
The sawlog industry, under pressure from plantations which now supply
the bulk of the construction market, is trying to build up niche markets
such as feature floorboards and furniture.
But most wood from native forests is still being chipped, or pulped.
While in most logging areas of East Gippsland about half the wood ends
up in paper products, the proportion from some areas is up to 90 per
cent, according to the executive director of the Victorian Association
of Forest Industries, Mr Graeme Gooding. In the Otways, where a forest
agreement is yet to signed, about 87 per cent of timber is pulped,
according to department figures.
Mr Andrews said that due to a worldwide pulp glut, the Newmerella mill
had stopped woodchipping last year. Residual logs are being processed by
a Cann River mill and the Japanese pulp giant Harris Daishowa, based in
Eden. ``They can't even sell what they've got,'' Mr Andrews said.
Mr Gooding said the Newmerella royalty would apply to low-quality logs.
He estimated that high-grade pulp logs from the Central Highlands were
worth about $10 a tonne to the Government, including road charges which
vary from $4 to $6. The road charge, which covers construction and
maintenance of forestry roads, was set at a flat $3.73 for Newmerella.
Environment Victoria's forest campaign co-ordinator, Mr Rod Anderson,
said the forest agreements, far from protecting forests, had led to a
massive increase in woodchipping, while there was already ample
plantation timber to meet all Australian needs.
``We know that in just about all native forests, the industry is
woodchip-driven but we don't often get it documented,'' said Mr
Anderson. ``Without woodchips, the industry in native sawmills wouldn't
survive. Sawmilling is a byproduct of woodchips.''
He could not understand why the Government was selling timber so
cheaply. Part of the answer may be political - protecting jobs
in Nationall Party electorates - and ``it partly relates to the collapse
in Asia and the woodchippers being very choosy'', he
said. ``But this price isn't new, so that isn't the complete answer.''