Friday Offcuts – 19 October 2018

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Announcements continue to come thick and fast on new investments being made in wood processing and manufacturing operations across the region. Hyne Timber have just announced another. This time, it’s a AU$20 million expansion of their glue laminated timber manufacturing operation in Maryborough, Queensland. Construction of the new plant is expected to commence within a matter of weeks.

This follows announcements made just over a month ago by Timberlink with a AU$100 million upgrade programme planned for their Tarpeena, South Australia and Bell Bay, Tasmania sawmills and AU$19.4 million being invested by OneFortyOne Plantations to upgrade their Mt Gambier Jubilee Highway sawmill. As well as benefitting the companies involved, their employees, their contractors and their local communities, the investments over the last couple of months continue to provide a glowing endorsement of the industry, it’s outlook and its potential for growth.

In forestry this week, we’ve provided an insight into new changes that come into force next week to New Zealand's overseas investment regime. Forestry rights will now come under the new overseas investment regime from 22 October 2018. A look at the new rules as they will now apply to overseas buyers of residential land and forestry investors has been supplied with a link through to the original article compiled by Buddle Findlay, a leading New Zealand commercial and public law firm.

Finally, thanks for your feedback and contributions on “people and training” as a result of last week’s issue. An ex-engineer from the NZ army commented; “If you’re looking for school leavers, get hold of their careers guidance counsellors and give them a hands-on experience. Let them feel what it’s like to be part of a professional team. Let them talk to the workers. Let them feel the pride that goes with the job. As a result, you’ll have people in the schools selling your industry from the heart. Essentially, they’ll be working for you for free. Without winning their hearts you’ll just have people giving out pamphlets like they’ve always done”.

For a couple of positive news stories to end the week on, we cover the six award winners announced at the Forest Growers Research gathering in New Zealand this week and we also feature a story from a new training enterprise in the lower South Island of New Zealand. It’s a story of two brothers, both which have followed in their Dad’s footsteps. Both have continued in harvesting (different crews though) and together have signed up for apprenticeship training with support coming from a local forestry company. Keep these stories coming. That’s it for this week. Enjoy this week’s issue.

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Hyne Timber announces significant expansion

Hyne Timber has announced a significant expansion to its Glue Laminated Timber (GLT) manufacturing capability in Maryborough, Queensland.

Already a significant manufacturer of GLT in addition to softwood timber products, this expansion investment with the support of a Queensland Government Jobs and Regional Growth Fund will launch the company into a globally competitive product offer.

The new state-of-the-art manufacturing plant will accompany the existing plant in Maryborough’s Industrial Estate which is now in its 40th year of production. This announcement comes as engineered timber manufactured from plantation softwood is increasingly preferred for larger scale commercial and residential construction projects due to its superior sustainability and environmental credentials.

During Friday’s announcement with local MP, Bruce Saunders, Hyne Timber’s CEO, Jon Kleinschmidt said investment to increase manufacturing capability has never been more timely, “Increased GLT manufacturing capability has been on our horizon for a number of years and a Queensland Government grant has accelerated this investment”.

“We have been experiencing an increase in demand for GLT products so this new capability can increase volumes, improve speed of delivery while broadening our product capability to capitalise on new growth opportunities for the timber industry. GLT is the talk of the design and construction industry, but a lack of competitive Australian supply options has prevented many projects from using it”.

“Increased capability here in Australia will be a game changer for the construction sector and a very positive area of growth for Maryborough.” Mr Kleinschmidt said. Construction of the new plant is expected to commence within a matter of weeks.

This is one of the most significant milestones in the history of Hyne Timber, which itself dates back to 1882. Recruitment of a range of specialist roles will commence well ahead of plant commissioning, with more operational and specialist jobs created as production scales up. Hyne Timber will be releasing progress updates throughout the next few months as the new plant nears commissioning around mid-2019.

Photo: Hyne Timber CEO Jon Kleinschmidt, MP Bruce Saunders and Fraser Coast Mayor, George Seymour with softwood beams

Source: Hyne Timber

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Near real time forestry monitoring innovation

We recently covered two stories on remote sensing for forestry applications. Below is information linked to a new service being supplied by a South African company, Swift Geospatial who will be presenting at the Australian leg of the upcoming ForestTECH 2018 series on 20-21 November. The company is providing their clients with geospatial solutions derived from Satellite and Unmanned Aerial Vehicles collected data.

Remote sensing has been used for large scale earth observation for years to gather data in the form of multispectral satellite imagery, which can be used for monitoring purposes. The forestry industry at large has not used remote sensing due to the lack of consistent high-resolution imagery and the ability to transform this data into useful, actionable information.

In the past, planted and natural forestry could only be monitored in a cost-effective manner using low to medium-resolution satellite imagery. These satellite sensors provided valuable information, but often the image resolution and frequency were of poor quality. This has all changed now with the introduction of Planet.

Planet is a satellite constellation comprising of 188 nano satellites of 3 metre resolution capable of taking an image of the entire land mass of the world every single day. This technological innovation within the earth observation and remote sensing environment has now expanded our views of what is possible on medium to large scale monitoring projects. However, the problem remains; how does this data become knowledge and assist in decision support throughout the forestry industry?

Swift Geospatial has been working closely with industry leaders to better understand the requirements of the forestry manager and organisation as a whole and they believe that their innovative forestry monitoring solution is now delivering on those requirements.

The solution’s deliverables are all in near real time:

1. Compartment/Stand health report
2. Fire break status report
3. Felling/Harvesting status report
4. In-field personnel status

All the above outputs are displayed through an online web-application that is custom built for each client. You can now have near real time information on your entire forestry plantation or natural forest through satellite monitoring using the latest in satellite technology. The image shows a typical harvest/felling progress that can be seen in the online web-application.

Having the ability to track felling daily throughout your plantation not only offers insight from contractor monitoring to the ordering of seedlings but can be used for the identification and monitoring of potential illegal logging and associated activities.

Swift Geospatial is currently monitoring over 1 000 000 Hectares of planted and natural forestry throughout Africa. For further information on their forestry monitoring solution click here. The company will be presenting and exhibiting at the Melbourne ForestTECH 2018 event being run on 20-21 November. Full programme details can be found on the event website,

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2018 Forest Growers Research awards announced

The Forest Growers Research Awards were announced on Tuesday night at a function in Tauranga. They have been awarded each year since 2011 to recognise outstanding achievements in forest growing research in New Zealand. The six major award winners for 2018 are:

Research Award for Communication and Sector Engagement
Paul Millen, Drylands Forest Initiative. See a feature on Paul’s work with dryland eucalypts in Episode 6 of Forest Call

Research Award for Innovation that Enhances Sector Value
Simeon Smaill, scientist, Scion. Simeon has spent the past five years (at least) investigating the potential of novel methods for improving the growth and vitality of radiata pine. See a feature on Simeon’s work with mycorrhiza in Episode 10 of Forest Call

Research Award for Science of International Quality
The research team comprising Jessica Kerr, Brooke O’Connor and Steve Pawson from Scion in Christchurch. Awarded for their world leading research in the Urban Battlefield Biosecurity project. See a feature on the team’s work in Episode 9 of Forest Call

Research Award for Research Participation and Implementation
Paul Adams, Technical Manager, Rayonier Matariki Forests. Paul is an active member of the technical committee for the Growing Confidence in Forestry’s Future (GCFF) research programme.

Research Award for Contribution to a Science Team
Rebecca McDougal, Molecular Forest Pathologist, Scion. Rebecca is one of a new breed of pathologists who have revolutionised how diseases are diagnosed, using new molecular techniques.

Research Award for a Young Scientist
Nurzhan Nursultanov, PhD Student, University of Canterbury Electric Power Engineering Centre (EPEC), Christchurch. Nurzhan has contributed significantly to the research programme reviewing alternatives to methyl bromide log fumigation treatment with a non-chemical approach using electrical energy.

Full details on each of the awards, recipients and background to their work can be read on the attached media release.

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Changes to NZ’s overseas investment regime

There is now just a few days left before the main changes to New Zealand's overseas investment regime come into force, on 22 October 2018. The changes will bring in new rules that further restrict the kind of property that overseas persons can acquire in New Zealand without first obtaining consent under the Overseas Investment Act 2005 (the Act). In this article compiled by Buddle Findlay, tips are provided for overseas buyers of residential land and forestry investors to navigate the transition to the new rules. They’ve also summarised changes to the corporate reorganisation exemption. More >>

Source: Buddle Findlay

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Forestry apprentices growing the industry

In last week’s issue we asked for more good news stories to profile the industry, particularly to the younger generation. Attached is one supplied by Rayonier Matariki Forests. The company is stumping up tuition fees for its Southland contractors to train their apprentices in a bid to encourage school leavers to join the NZ forestry industry.

Tuatapere brothers, Jackson and Ethan McCallum are the first to sign up to the apprentice programme being offered through Rayonier Matariki Forests. Jackson (18) and Ethan (16) leapt at the opportunity to get a qualification in the industry they love. Their father, David (Daggy) McCallum, owner of McCallum Harvesting, was brought up in the forestry industry and shared his love of it with his sons.

Jackson has taken up a job working for his father as a crew member of the harvesting team while he completes his two-year apprenticeship in Forest Harvesting – mechanized operations. “I always wanted to work in forestry and to be able to get this extensive training and come out of it with a recognized qualification is great. I love being outdoors, often in the middle of nowhere, working alongside and learning from a great bunch of guys.”

Jackson has his sights set on taking over his father’s business one day while Ethan, who is working for his uncle in his harvesting crew, ultimately aims to be his own boss. “I see this apprenticeship as a great opportunity to get some good skills. I’ve always wanted to work in the bush and l now I can learn from the highly experienced crew who are very knowledgeable and supportive, while also attending the course,” said Ethan.

The programme, developed by Competenz offers a high level qualification involving classroom sessions, working on professional hi-tech simulators, and theory combined with on-the-job training provided by employers. Rayonier Matariki Forests Quality Manager, Fraser Field, said his company was happy to assist with training fees in a bid to recruit people into the industry and lift standards of competency.

“We see this updated apprenticeship as a significant step forward in supporting newcomers into the industry and providing them with top level training, giving forest workers the opportunity to develop a life-long career in forestry. “Mechanised forestry operations are the future of harvesting in New Zealand and we need to make sure that our people are well equipped to embrace the coming technological changes,” said Mr Field.

Daggy McCallum, who followed generations of his family into forestry, said the new high level qualification reflected what is happening in the industry. “The face of forestry is changing. We’re using new machinery and new skills are required. The apprenticeship course has been updated and made more relevant to what is happening in the forest.

“As an employer, it is hugely beneficial to have my people qualified to this standard to improve safety and productivity on the job. The way the course has been designed provides flexibility for both the employer and the apprentice,” said Mr McCallum.

Photo: The McCallums. From L to R; Jackson, Daggy & Ethan

Source: Rayonier/Matariki Forests

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Wood harvests expanding in Eastern Russia

Timber harvests in Russia were close to 190 million m3 in 2017, as estimated by WRI based on forest industry production, log usage and net exports of logs. The derived timber harvest was up approximately 6.2% from 2016 primarily due to higher log consumption by the softwood sawmilling sector and the pellet industry. Domestic log demand in Russia has been on a steady upward trajectory over the past decade, while the exportation of logs has declined. The largest log-consuming sectors in 2017 were softwood sawmills (60% of domestic log usage) and pulp (17%).

The provinces of Siberia and Russia Far East are the only regions in Russia where timber harvests have gone up during the past five years, according to the government agency Rosstat. This has been driven by substantial investments in forest industry production in the region, predominantly in the sawmilling sector. From 2013 to 2017, harvest volumes in Eastern Russia were up 30%, while they remained practically unchanged in North Western Russia and fell in the Central provinces of the country.

The expansion of the forest industry in Eastern Russia has been driven by demand for lumber in China. Although the Chinese forest industry has a history of importing logs for its raw-material needs due to a lack of domestic sources, the trend over the last ten years has been towards the importation of softwood lumber rather than logs.

Chinese importers have gradually shifted their historical preference for logs away from the Russian Federation towards New Zealand and instead are importing softwood lumber from their forest-rich neighbour in the north, according to the Wood Resource Quarterly. The percentage of lumber as a share of total log and lumber volume (in roundwood equivalents) has gone up from 58% in 2014 to almost 80 % in 2018.

In the coming years it is expected that most of the investments in Russia’s forest industry will continue to occur in Siberia and the Far East to meet continued rising demand for lumber, plywood and pulp in China.

Source: Wood Resources International LLC,

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2018 Australian Timber Design Award winners announced

The Annual Australian Timber Design Award winners for 2018 have been announced at The Star in Sydney, where FJMT was crowned overall winner for their work on Bunjil Place. Located in Casey’s entertainment district, just south-east of Melbourne’s CBD, Bunjil Place contains an entrance foyer with a world-class Glulam timber grid-shell in the shape of an eagle with its wings spread.

The remarkable structure seamlessly combines breath taking design with Casey’s unique Aboriginal heritage, drawing on inspiration from the land by the culture’s traditional owners 'The Meeting of Many Paths' and 'Bunjil' the Eagle.

The Glulam timber grid-shell appears to be weightless and hovering, only lightly touching the foyer floor at two points. The compelling use of timber defines a warm and inviting design, further reinforcing the open and welcoming nature of the complex.

Winners were announced at The Star in Sydney, where a large number of members from the Australian timber design and architecture community came together to celebrate the 2018 Australian Timber Design Awards.

For a full list of winners and finalists visit the Awards eBook.

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First NZX traded carbon fund to be listed

Salt Funds Management plans to list a dedicated carbon fund, opening up the green commodity directly for retail investors. Salt's Carbon Fund is expected to be 98 percent invested in carbon commodities, with 2 percent held in cash and equivalents. The fund will buy credits in New Zealand's emissions trading scheme and also in international schemes.

It may use swaps, futures and other derivatives to get exposure to those markets. The offer is expected to open next week but isn't seeking money yet. Salt plans to list the Carbon Fund on the NZX next month.

"This fund positions carbon as a new alternative asset and aims to give individuals and organisations a chance to invest in or offset these changes," managing director Paul Harrison said in a statement. Provided the offer gets Financial Markets Authority approval it will be the first listed green investment entity in New Zealand. The units will be sold at $1 each with a minimum $5,000 investment.

NZX has been keen to foster a wider use of green investment tools and vehicles, with a growing number of green bonds listed on the debt market. At the same time, the government is charging ahead with its Carbon Zero legislation. The Crown's provisioning for emissions trading scheme credits rose to $2.54 billion as at June 30 from $2.03 billion a year earlier, with the carbon price rising to $21.10 per unit from $17.20 in June 2017.

"The historical carbon price has been quite volatile relative to traditional asset classes such as shares and bonds," the offer document said. "Price fluctuation plays a significant role in the carbon market and carbon dioxide emissions reduction."

Source: BusinessDesk

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Revision of the Standard for Sustainable Forest Management

Responsible Wood is an Accredited Standard Development Organisation and has responsibility for developing and maintaining Australian Standard AS 4708 Sustainable Forest Management.

Responsible Wood has announced the commencement of the 5-yearly review of AS 4708. AS 4708 specifies the environmental, economic, social and cultural requirements that must be met to demonstrate good practice and continued improvement towards Sustainable Forest Management.

Responsible Wood reviews this Standard every 5 years to ensure it incorporates the latest knowledge, best practices and evolving stakeholder expectations. The review will be undertaken in conjunction with Standards New Zealand to develop a joint Australian/New Zealand Standard suitable for delivering Sustainable Forest Management in both Countries.

Responsible Wood is inviting interested stake holding organisations in the following categories to nominate candidates for the AS/NZS 4708 Standards Reference Committee and Working Groups.

- Forest Growers
- Business and Industry
- Indigenous people
- Non-Government Organisations
- Scientific and Technology Community
- Workers and Trade Unions
- Local Authorities

For further information, to nominate or to lodge an Expression of Interest please contact: Simon Dorries at Responsible Wood by or Tel: (+61) 7 07 3359 1758.

Further information on the project and scope is available on the Standards Proposal on this link

Information on the Standards Setting Process and Standard Settings Procedures is available on the attached link

Source: Responsible Wood

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The robots are coming - to wood manufacturing

Advanced Automation was a key component of the just completed WoodTECH 2018 series run for local wood manufacturers. In fact, one presenter discussed in New Zealand a local wood producer that has just integrated robotics into much of their new lumber manufacturing operation. In this article leading suppliers discuss major trends and developments in pallet and lumber machinery including robotics, scanners and more. This article will help you identify what you need to know before making that big machinery or automation purchase including a list of key questions to consider.

Leading suppliers discuss major trends and developments in pallet and lumber machinery including robotics, scanners and more. This article will help you identify what you need to know before making a purchase. At the recent Interpal meeting, one issue rang out more than any other. No, it wasn’t lumber. It was labour. Regardless of the location or the type of business, almost everyone was having problems finding and retaining good production employees.

This labour crunch has spurred significant technology research and investment over the past few years. None of the technologies are breakthroughs compared to other major industries, such as automotive or high-speed consumer product manufacturing. But they are firsts for pallets and in some cases wood products.

The following are insights from machinery experts who share their thoughts on advanced automation, including robotics. Some of these comments come from interviews conducted by Pallet Enterprise. Others are taken from a panel at the National Wooden Pallet & Container Association’s Annual Leadership Conference (ALC) held earlier this year.

More than really answering your questions, this article is designed to help you know what questions to ask so that you can make the right decisions. There is no one right solution here. However, the options are improving daily.

Advanced automation is a whole lot more than just robots. Some of the fastest production facilities use no robots at all because robots have longer cycle times required by the motion of the robot. But there are some applications where robots are a good fit. More>>.

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XLam changes in senior management

In light of the major project and partnership opportunities emerging in the sector and the increasing multinational demand for the company’s products and services, the XLam board has undertaken an extensive review of their current operations and structure. The current factors driving the board’s decision are market development and sales conversion in New Zealand and Australia, and the need to future-proof the business for growth.

His expertise and industry relationships make Gary Caulfield the point person to specialise in the rapidly expanding project part of the business, and to free up his time away from day-to-day plant management Gary is taking up the newly created role of General Manager XLam Projects. Gary will focus 100% on existing projects and on the opportunities for service and collaboration on public and private projects that are currently in the planning stage and for which XLam is optimally positioned.

Stepping into the CEO role (effective 1st October 2018) is Shane Robertson, whose years of service with Hyne have honed his leadership skills and given him extensive experience in manufacturing and finance – making him ideally qualified to lead the next growth phase of the business, which will include significant expansion on the manufacturing side.

Gary retains overall responsibility for sales, marketing, construction and commercial functions of the company, while Shane will oversee the manufacturing, design and accounting functions. The board congratulates Shane and Gary on their roles and thanks them for their commitment to XLam and our industry.

Source: Xlam

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Increasing forest plantations with insurance premiums

Argentina aims to increase forest plantations to 2 million hectares from 1.3 million hectares by 2030 through a 'Green Insurance' program; 1% of vehicle insurance premiums will fund tree planting to mitigate climate change, foster economic development.

According to a recently published legal alert, Argentina will create a “Green Insurance” program to promote both forestation and enrichment of native forests with the aim of increasing forest plantations from 1.3 million hectares to 2 million hectares by 2030. Argentine President Mauricio Macri has announced an agreement between the Insurance Superintendency of the National Ministry of Finance and the country’s leading insurance companies to create this program.

To reach 2 million hectares by 2030 would mean expanding forested areas by 62,000 hectares per year. Under the Green Insurance initiative, 1% of the premium of each insurance policy covering motor vehicles, motorcycles and cargo trucks would be allocated to the Forest Promotion Law (No. 25,080), which encourages planting trees to mitigate climate change and to foster economic and social development. These funds will finance tax incentives for plantations and the reimbursement of certain planting costs for qualifying activities.

Law No. 25,080 establishes a regime for promoting investments made in new forestry enterprises and in expanding existing forests. The initiative covers activities such as implementing new forests, including their maintenance, management, irrigation, protection and harvesting; research and development; and timber industrialization. Individuals or legal entities that participate in activities included under this law (including foreign investors) may apply for a special tax regime (which includes, among others, guaranteed tax rates for a term of 30 years, refunds of value-added tax and a differentiated income tax amortization regime) and a monetary contribution in the form of a reimbursement of a certain percentage of plantation costs (depending on the hectares, zone, species and forestry activity involved).

To implement the Green Insurance initiative, the Insurance Superintendency of the National Ministry of Finance and the Ministry of Agro-Industry have enacted their Joint Resolution No. 1/2018 that creates the environmental sustainability and insurance program (the PROSAS), which would collect the 1% insurance premium to fund the program. The PROSAS will be funded by the voluntary contributions of the insurance companies and its funds will finance the Monetary Contributions for qualifying projects under Law No. 25,080.

The Green Insurance initiative is currently in the process of identifying, enlisting and registering the insurance companies that will participate in the program. It is expected that the first funds will be collected in approximately three months.

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Investment in innovation driving higher returns

Manufacturers who invest in innovation – which could be a new product, a new service, new data systems or technology, or a change in the way they run their business - can have significant productivity gains over those that don’t, according to new research by ANZ.

The research looked at 49 New Zealand manufacturers that had received Government co-funding grants for R&D activities through Callaghan Innovation. They were benchmarked against 504 other businesses operating in the same sectors.

The 49 firms generated a median Return on Invested Capital (ROIC) over four years of 14.1%, compared to 10.9% for the control group of 504 businesses. They also grew sales revenue faster, achieving a median result of +9.3% per annum relative to the control group at +6.4%.

“The research shows that companies who decide to invest in innovation can be rewarded by gains in productivity,” said ANZ Commercial & Agri General Manager Penny Ford.

“New Zealand’s competitors are embracing change and investing in innovation. So, it is important we also think differently about how we drive our future growth. If we don’t act New Zealand risks sliding further down the global productivity rankings. Moreover, New Zealand businesses will find it harder to compete.”

The research is contained in Innovation and Productivity, a report ANZ has released to challenge existing business practices and stimulate thought on how New Zealand can lift productivity levels. “A key driver to lift productivity is to embrace technological change and invest in processes, R&D and technologies,” said Ms Ford.

“We are seeing great examples of New Zealand businesses that have invested in innovation and, as a result, are recognising significant productivity gains over those that haven’t.” The full ANZ Innovation and Productivity report can be found here.

Source: Scoop

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... and one to end the week on... keeping with the Irish theme

...and sent in by a reader last week ...

Paddy was very proud of his new motorbike and drove it round to his girlfriend Sheila’s place to show it off and take her for a spin.

The weather was a typical Irish day with a cool wind blowing from the Irish Sea and Paddy, who hadn’t yet purchased a fancy leather jacket, was feeling the cold. Sheila suggested that he take off his jacket and put it on the wrong way round and she would button it up at the back.

When they set off again Paddy felt a lot warmer and decided to open up the throttle. As they rounded a bend, Brian O’Brien was driving his tractor and trailer from his farm paddock onto the road and the inevitable happened.

When the ambulance arrived the paramedic asked Brian if either of the victims was still alive.

Brian replied “the one in the front was until I turned his head around the right way.”

OK - one more for you. A Polish immigrant went to apply for a driver's license.

First, of course, he had to take an eye sight test.

The optician showed him a card with the letters: 'C Z W I X N O S T A C Z.'

"Can you read this?" the optician asked.

Read it?" the Polish guy replied, "I think I know the guy."

And on that note, enjoy your weekend. For the kiwis, we have an extra day with Labour Day, a public holiday, being observed on the Monday. Cheers.

Brent Apthorp
Editor, Friday Offcuts
Distinction Dunedin Hotel
6 Liverpool Street, Dunedin 9016, New Zealand
PO Box 904, Dunedin 9054, New Zealand
Tel: +64 (03) 470 1902, Mob: +64 21 227 5177, Fax: +64 (03) 470 1906
Web page:

This week's extended issue, along with back issues, can be viewed at

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