Friday Offcuts 24 February 2012
For the Tasmanian forestry industry, Premier Lara Giddings has again this week called for moderation and calm from all parties involved. The call’s gone out to the fringe environmental groups; cease the campaigns being waged in local and international markets so the current process is given time and space. The pressure also went up a notch this week for when the Gillard government said that they won't be intervening to impose a peace deal if agreement can’t be reached between the forestry industry and green groups.
Certainly, the approach and tactics being taken by some of the opponents to the forests deals has raised the ire of many of our readers this week – see Letters to the Editor. Several of the links to videos supplied by readers in fact weren’t posted because of the language being used. The links to Youtube videos of “recent meetings with activists in Tasmanian forests” can be found in the Tasmanian IGA & Peace in Our Time story. Although tough on the ears, they do clearly highlight the considerable pressure that those working in the Tasmanian forests at the moment are under.
This week we also run a story on the size of the global market for wood preservatives and the growth – and opportunities that are open to traditional wood treatment companies with wood plastic composites. These and a range of new alternate wood treatments are being covered in this year’s Wood Preservation 2012 series running in mid-May. Event flyers for the series are being posted out next week. A modified wood structure, an eye opening sunken bridge in the Netherlands is also shown which is constructed of chemically modified wood.
Finally, remember for those industry leaders interested in the two-yearly financial update, Future Forestry Finance 2012, the series starts in New Zealand in just 12 days – and then one week later, in Sydney, for Australian forestry and financial companies. Further details and registrations can be made on www.forestryfinanceevents.com
This week we have for you:
Australian landholders interest in carbon forestsLandholders spiralling interest in carbon forests has resulted in CO2 Australia investing an estimated AU$23.3 million in rural economies during 2011. CO2 Australia land acquisition manager Mark Ritchie told The Fifth Estate that the organisation had secured revenue of AU$35 million for the 2011 financial year and manages a contract portfolio exceeding AU$160 million.
It expects a significant increase in interest by companies looking to manage their carbon liability. The number of landholders investigating carbon sink opportunities with CO2 Australia had increased by 681 per cent since the introduction of the government’s carbon farming initiative in August 2011.
“It is early days for the CFI and difficult to judge the size of the market however the potential is substantial given the new carbon tax,“ he said. More companies will be looking at ways to hedge against the future cost of carbon emission permits. Carbon forests are a low-cost alternative for companies to offset their emissions, rather than pay a more expensive carbon tax.”
CO2 Australia has carbon sink sites in NSW, Victoria and Western Australia, and is also investigating opportunities in Queensland and the company has more than 22,000 hectares of carbon sink plantings under its management. Source: The Fifth Estate
Moderation needed in Tasmanian forestry debateTasmanian Premier Lara Giddings has called for moderation and calm from all parties involved in the forest debate. She said compromise and goodwill were needed to allow for a resolution that ensures the industry can remain on a sustainable footing while delivering improved environmental outcomes.
“The divisions over our forests have hurt the Tasmanian community for far too long. The debate is highly emotive, particularly when it comes to people’s jobs, but I call on everyone involved to act responsibly and with moderation. I understand that people are passionate but it is concerning that in recent days we have seen a series of angry confrontations, threats and acts of sabotage. That sort of behaviour has no place in our community" says Ms Giddings.
Giddings also released and endorsed a resolution presented to her last Thursday by Ta Ann workers which reads: "We, the workers at Ta Ann Tasmania, urge the Government and both houses of Parliament to do whatever is in your individual and collective powers to reach an agreement that resolves the on-going disputes about our industry in Tasmania. We need to secure Tasmania's jobs and the livelihoods that they provide for our families and communities."
“I have great sympathy for the plight of forest workers and their families whose livelihoods are threatened by the changes that are currently taking place in the industry. The Ta Ann workers have my full support and I can assure them my Government will continue to do all it can to secure a sustainable future for them, their families and the communities in which they live.”
WPC’s offer wood treatment industry opportunity
As well as a pretty positive picture being painted on the expected growth of traditional treated wood products, alternate products are increasingly making themselves known in the marketplace. Wood Plastic Composites (WPC’s) are making significant inroads into traditional treated wood products.
“They’re now a commercial reality but offer wood treatment operations the ability to diversify their manufacturing operations. WPC’s are low capital, flexible and highly automated manufacturing operations that can complement other traditional wood treatment and processing operations” says Brent Apthorp, FIEA Director.
The WPC industry was valued at US$2.1 billion industry in 2010. Furthermore, growth has been around 15% compounded each year over the past five years. North America dominates WPC production at the moment – but this is quickly changing. It currently accounts for around two-thirds of world-wide production. Decking and fencing markets typify the recent growth of WPC’s. The US decking market, valued at US$6.2 billion is expected to rise 2.7% per year through to 2014. Wood decking over this time is expected to rise less than 1 % annually while alternative decking materials, such as WPC and plastic or vinyl lumber, are expected to show double-digit demand gains.
The US$6 billion fencing market is a similar story. 2010 figures show vinyl and WPC’s already hold a 25% share of the US fencing and railing market. Traditional wood markets such as concrete formwork, container floors and facing panels are also reportedly losing to these alternate products.
China, as expected, is the other major producer of wood composite products. From just 80,000 tonnes produced in 2006, over 300,000 tonnes of WPC’s were produced in 2010 and growth of over 30% per year from this point is projected. Over 100 WPC production lines are operating, more than 500 patents have been awarded and more than 20 Universities in China are currently doing WPC research.
Australian and New Zealand WPC sales are still small by comparison but expected to double in the next two years. In a recent article on wood substitutes, it was estimated that 8% of all local authorities across Australia are using WPC’s. One source estimated that demand could increase at 50% annually.
One of Australasia’s largest recyclers of plastic into plastic wood (22 tonnes every week), Adelaide based Advanced Plastic Recycling, will be presenting at Wood Preservation 2012. They will outline opportunities that exist for production of plastic wood for outdoor products such as park tables, benches, decking and fences.
Wood Preservation 2012 will be the sixth in this series of technology updates. It runs in Rotorua on 16-17 May and again in Melbourne on 23-24 May. Full details including the programmes for this latest technology series can be downloaded from the event website, www.woodpreservationevents.com
Alternative plan to Tasmanian forests peace dealThe Australian reported this week that a secret alternative Tasmanian forest plan is being hatched as the Gillard government's AU$276 million peace deal faces collapse. The alternative comes ahead of expected findings that the peace deal cannot deliver promised conservation gains.
"Plan B" is reportedly being drawn up by Bob Gordon, managing director of the state-owned Forestry Tasmania, and has been discussed with state and federal ministers. It would deliver almost the same size of reserve area sought by green groups as their minimum ask - 430,000ha - but is more fragmented and includes some different forest areas.
Green groups accused Mr Gordon of seeking to undermine the IGA. The Labor government, which shares power with the Greens, defended Mr Gordon. "The fact that Forestry Tasmania has gone to the trouble of exploring options demonstrates its willingness to play a constructive role," a spokesman said.
Tell the world about wood - a call to armsWe've added this story as it links in directly to some of the wide ranging discussions readers had earlier this year on the need to improve our communications game. It's an editorial taken from last week's "The Working Forest Newspaper" - a weekly e-newsletter written for Canadian forestry sector.
"At the B.C. Truck Loggers Convention in January, Dr Patrick Moore described what the resource extraction sector, not just the forest industry, is facing. Well organized, well-funded and inextricably but opaquely linked web of environmental activists are working hard to undermine Canada's strengths.
In this issue researcher and blogger Vivian Krause describes the flood of U.S. charitable funds that pour into Canadian environmental group coffers to undermine Canadian natural resource policy. New Zealander Brent Apthorp of the Forest Industry Engineering Association and publisher of e-newsletter - fridayoffcuts.com - told The Working Forest that the Australasian forest sector needs to fight back against the deluge of misinformation that threatens to turn society against a viable, sustainable and economically essential sector.
At the TLA there was disagreement as to who should be responsible for delivering the message. Government owns the land - let them do it, some say. But aren't governments a large part of the problem? Over 20 years ago, the Canadian industry was beset by the so-called 'War of the Woods'. The Carmanah and Walbran Valley in B.C., Temagami in Ontario and countless other skirmishs with protesters across the country.
There was a response at that time by the forest industry which was effective. The industry started, as Dr Moore often calls for, to 'think retail'. That is, large marketing and promotional campaigns that make the people using the product feel good about what they do. What started in B.C. spread across the country and culminated in a national ad campaign by the then CPPA (now FPAC). It was successful. It started to move the needle of public opinion. It annoyed the enviros. The program was beginning to work.
But something changed. The ad programs were reduced, the money dried up and apparently the War of the Woods was over. It was time for negotiation. If we could speak directly to the people organising the propaganda then we could make deals and convince them to be on our side said the experts.
Since then, we have had countless consultations with people who are only interested in one goal. The latest, the Boreal Forest Accord, which is a shambles, has achieved nothing. It has wasted thousands of dollars of industry money. It has diverted the industry from pursuing the real course: to tell people it's OK to use forest products.
In the late 80s and early 90s, many companies offered tours, set up speakers' bureaus, visited schools, allocated resources - human and financial, and advertised. This should have been the 'business as usual' approach from that time. Direct our messages at the consumer not the special interest. This time we have a whole new social media system to work with.
In 1990, the late E.B. Eddy Forest Products CEO Ted Boswell said "If we can't figure this out - we don't deserve to be successful." Too right, Ted!"
US navy inspects Australian biofuel plantUS navy warships could one day be running on biofuel technology developed by Queensland researchers. Queensland University of Technology (QUT) biofuel researchers have given US navy officials a tour of their pilot plant in Mackay where biomass is converted into transport fuels.
QUT's Professor Sagadevan Mundree said the US navy's director for operational energy, Chris Tindal, has flown to Queensland to learn more about the technology's progress. "QUT is the only institution in Australia with the capability of demonstrating a diverse range of waste to biofuel technologies at the pilot scale," Prof Mundree said.
He said the US navy wants a "Great Green Fleet" of warships running on biofuels by 2016, and by 2020 it plans to run half of its entire fleet on alternative fuels. It would require 80,000 barrels of biofuel by 2016, Prof Mundree said.
He said the pilot plant has been operating for more than 14 months and researchers there are already working with a number of Australian and international industry partners to develop and demonstrate technologies that turn agricultural waste, such as bagasse from sugarcane, into biofuels. Source: 9 News
A bridge like none you've ever seen
Designed by RO & AD Architects, the Moses Bridge literally parts the waters that surround the fort, allowing pedestrians to pass through. The bridge is made from sustainable Accsys Technologies Accoya wood, which is both FSC and PEFC certified.
From afar, the Moses Bridge is invisible to the eye. As visitors approach the fort, the bridge appears as a break in the water with its sloping walls containing it. First lying flush with the earth, the bridge then descends deeper into the ground.
Lined with wood sheet piling for walls, the deck and stairs sit between. The bridge and its components have been made from sustainable softwood that is Cradle to Cradle Gold certified. The Accoya wood is also treated with a nontoxic coating, protecting it from fungal decay and increasing its durability — an ideal material for a sunken bridge.
For further details and images click here
EU action gives carbon prices a boostCarbon News has reported that carbon prices are rising on the back of European moves to limit supply. The European Parliament is considering changing the rules governing the European Emissions Trading Scheme to allow the flow of units into the scheme to be limited from 2013 as a way of bolstering prices.
Carbon fell 80 per cent last year amid an oversupply in Europe and concern over the financial stability of the region. In New Zealand, that meant that spot CERs fell from the $17 range in July to a low of $5.59 on January 19. The European tumble also affected New Zealand’s domestic carbon units, NZUs, which fell from a range of $18 to $21 in the first part of last year to a low of $6.90 this year.
But CER prices were up on news that the European Parliament is likely to accept the so-called set-aside provision. Source: 2012 Carbon News
Impacts of reduced log export tariffs in Russia
Log exports from Russia have plummeted the past five years mainly because of the country’s implementation of a log export tariff of 25% in 2008, as reported in the WRQ. Despite having suffered a sharp decline in global market share, Russia is still the largest exporter of softwood logs in the world.
When Russia was accepted into the World Trade Organisation (WTO) in December of 2011, one of the requirements for the entry into the organization was that the country had to reduce export and import tariffs on forest products. According to persons close to the negotiation process, the not yet official proposal for the amendment of the Russian log export tariff system will lower the tariffs on softwood logs from 25% to 15% for pine logs, and to 13% for spruce logs.
The new proposed tariff for birch will actually be higher than the current tariffs for small diameter logs. In addition to the lowering of the tariffs, the proposal also includes a volume quota for softwood logs. Below the quota limit, the new tariffs will apply, and for volumes above the quota, current tariffs will continue to be in effect.
The proposed quotas will almost certainly have no impact on trade with the EU, since they are set substantially higher than the volumes shipped in 2011, and are close to the record high levels of 2006. The quota level for countries outside the EU is proposed to be 13 million m3, of which pine species account for 95%. China is the major destination for Russian pine logs, and in 2011, shipments were well below the proposed quota volume.
Over the past ten years, there have been three occasions when the annual shipments of pine logs have been higher than the quota volume. Even with a reduction in export taxes of 12%, it is not likely that foreign log buyers will rush back to Russia to purchase higher log volumes in the coming years since the business climate in the country continues to be challenging in terms of political uncertainty, continued corruption, increasing domestic log costs and infrastructure problems.
This uncertainty makes many forest companies wary about investing or trading with Russia, so they will likely try to diversify their timber sourcing further to include other regions. China, which is the largest importer of Russian softwood logs is increasingly choosing to import lumber rather than logs from its northern neighbour. Source: Wood Resources International LLC, www.woodprices.com
Lid taken off misleading carbon advertisingFor those who missed Wednesday’s Fair Go programme that aired on New Zealand television this week, you might like to check out the footage on tvnz.co.nz/fair-go The reporters were hot on the trail of rural real estate agents that were building in the benefits of the value of carbon credits to a property sale - without any understanding of the scheme or the value – or liabilities – to prospective purchasers.
New Zealand Log Prices - February 2012In-market log prices have gained a little this past month, the fourth consecutive lift since a massive drop in November. Although the lift was only $2 and $1 dollar for KS and KI logs respectively. A grade logs are now at US$130/JASm³ CFR in-market. Wharf gate prices for logs in NZ are down slightly on last month, one or two dollars. This could possibly be explained by the jump in the NZD/USD exchange rate that has gone up over 0.83 cents and remained there for some time.
Inventories in China have built up over the Chinese New Year period; it was expected several months ago that this would happen. Although inventories are expected to reach over 4 million cubic metres by March, the level that tipped the market into a sharp downward fall last November. It is a different situation this time. China is coming out of winter, after the holiday break. Consumption should be lifting so this will help move logs off wharfs and get stocks down to more balanced levels.
The Agrifax Log Price Indicator has softened this month with a slight decrease across the board for most log grades and in all regions. Most price drops were of only a few dollars, but combined this has seen a slight easing. Price drops were mostly associated with the high New Zealand dollar, and some over supply issues in markets. With the decrease in off take from stocks in China due the Chinese New Year holiday this has meant that stocks were able to build to a very high level and price reductions may be needed to clear this in time before any down grade in log quality occurs.
The Agrifax log price data is a weighted average of prices collected each month from a range of New Zealand log buyers and sellers. Log prices shown in the table will vary regionally and by supplier and should only be used to provide a broad trend of log price movements.
Welcome function to raise funds for local kidsThe official AUSTimber Welcome function will be held on Thursday 29th March 2012 at the prestigious Barn Steak House in Mount Gambier and hold a charity auction to raise funds for local disadvantaged children.
This premier industry networking event will welcome all international, national and local visitors to the AUSTimber 2012 Conference and Expo, with a special key note speaker, celebrity auctioneer and quality dinner. It is the prime opportunity to network with colleagues across this broad industry.
The AUSTimber Welcome function will not only be the place to network but will also show the industry’s support to the community by raising funds via its charity auction for local children. Organisers have put the call out to generous businesses and individuals to donate goods that can be auctioned. Names will be promoted on the night as a generous donor. Please contact Libby@austimber2012.com.au to donate auction items or to book for the dinner.
2012 Australian Timber Design Awards now open
Entry is open to architects, builders, designers, engineers, interior designers and landscape architects. Categories cover all major applications, small budget projects, sustainability, a People's Choice Award and a Rising Star Award. This year's entries will automatically be considered for the 2013 International Timber Design Awards.
It's well worth a look to check out the amazing designs from previous winners at www.timberawards.com.au. Entries close 29 June. Winners will be announced in September at the Awards Presentation Night in Sydney.
Get started by reading through the entry categories: we're certain you'll find one to suit your project. When you're ready to begin your online entry submission (you may modify or add to it at any time up until the close of entries), sign up for the 2012 Awards!
Exit packages for Tasmanian forestry contractorsThe Tasmanian Forest Contractors Association has welcomed the announcement by Federal Minister Senator Joe Ludwig of the completion of the assessment and approval of 61 successful applicants under the IGA Contractor Exit Assistance Program. Successful applicants can expect to be made offers over the next few days.
"The exit assistance will be the saviour of many contracting families in this state, and a big help to the communities in which they live" TFCA chief executive officer Ed Vincent said. "This is a step in a long process. It provides certainty to those contractors that the industry re-structure, currently in full swing, provides a level of assistance to help their staff and families."
The Federal Coalition has given the thumbs up to the long-awaited announcement that support for Tasmanian forest contractors would finally commence.
Buy and Sell
...one to end the week on...Paddy's fingers
Paddy was working at the fish plant in Cork when he accidentally cut off all 10 of his fingers.
And on that note, have a great weekend. Cheers.
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