Could China’s Ban on Log Exports Mitigate Bushfire Impacts Onshore?

On New Years Eve 2019, bushfires ravaged plantation estate, throwing future timber supply into disarray.

Demand has remained very strong, keeping softwood sawmillers busy and many people employed throughout the COVID-19 pandemic thanks to unprecedented industry solidarity and the salvaging of burnt logs.

The bushfire impacts on softwood supply are yet to hit the market, as some sawmills exhaust viable feedstock.

Over the past few weeks, we have seen China switch off log exports from most Australian states resulting in job losses, and there are now logs with no homes and harvesting has ceased.

Can some of these logs be processed domestically to fill the void left from bushfires?

According to Hyne Timber, they have identified 441,500 m³ of saw logs previously destined for China if support becomes available to freight to domestic sawmills instead of finding alternative export markets.

While this volume of sawlog won’t see their Tumbarumba Mill back at pre-bushfire impacted volumes, it will go a long way to mitigate the full impact of the fires.

In short, it will supply quality, sustainably grown Australian timber for 10,000 new Aussie homes.

It is estimated, this log will cost almost $10M extra per year to freight as it is located outside the Mill’s viable freight distance and this is not an expense that can be absorbed or passed onto customers.

According to an independent economic analysis by REMPLAN, if there is government support to assist with freighting these logs to Tumbarumba over the next three years, 193 jobs will be retained across NSW and a further 63 in the Victorian transport sector.

There will be $244M in NSW gross revenue including $144M for Tumbarumba alone. In other words, for every $1 of tax payers money invested, a further $8 will be retained across NSW instead of unprocessed logs being exported with no further value add to the Australian economy.

Gary Walker, Managing Director of family owned Belmont Timber in NSW said he has written to the Prime Minister to voice his support for Hyne Timber’s urgent need to provide more logs into the Tumbarumba Mill,

“Belmont Timber is proud of the fact we have only ever used Australian timber for the manufacture of our preassembled frames and trusses with large volumes coming from Hyne Timber’s Tumbarumba Mill.

“The bushfires will impact the supply of timber for the construction sector and without support to get alternative logs to the Mill, we will be left with no choice but to source from imported timber.

“If there is a solution to avoid us having to source imported timber while jobs are lost in Tumbarumba, we need to prioritise this solution now more than ever.

“We are committed to Australia’s economic recovery as best we can be. We want to source local wherever possible, supporting local jobs with secure supply chains, not subject to international freight, fluctuating exchange rates in an uncertain global economy.” Mr Walker said.

Another large customer, Dahlsens, like Hyne Timber and Belmont Timber, is privately owned, and has been operating for 140 years, employing 1000 people in their hardware businesses across VIC, NSW, QLD, NT and WA.

Dahlsens General Manager, Mark Cooper said support for Hyne Timber to get logs to the Mill is not just about securing jobs at the Mill, it secures supply of timber throughout extensive supply chains.

“Being in the hardware industry for 140 years makes us passionate about its survival, including strong supplier partnerships with local suppliers wherever possible.

“Hyne Timber have a compelling case now more than ever. We shouldn’t have good logs being exported now, with no customer at all, while jobs are lost and our own local timber supply from Tumbarumba is impacted.

“We urge all governments to support any plan which will get more logs to the Tumbarumba Mill, providing good quality, sustainably sourced, locally grown and manufactured, plantation pine for our construction sector.” Mr Cooper said.

Sawmilling by-products are also a significant part of the supply chain and economy. If support can be sourced to help freight extra logs to the Tumbarumba Mill, this will produce an estimated 104,526 tonnes of chip supplied to Visy in Tumut for paper and packaging production and up to 24,457 more tonnes of bark for commercial applications including potting mix to grow the nations fresh food.

Dried wood shavings customer, David Shandley has further warned of disruption to the food supply chain as a result of the bushfires and the impact on by-product availability.

“Shandleys Transport buy 100 per cent of Hyne’s dried wood shavings, used as animal bedding for commercial food producers and supplying the major supermarkets nation-wide,” Mr Shandey said.

“The 441,500m³ additional log volume means 14,109 more tonnes of dried wood shavings, supporting jobs in Holbrook and beyond. We hope the Government will work with Hyne to protect our supply chains and secure the flow of Australian logs, timber and by-product to benefit our own economy and regional communities.” Mr Shandey concluded.

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Background:

Hyne Timber was established in 1882 in Maryborough, Qld.

It remains a privately owned, 6th generation timber company manufacturing softwood and glue laminated timber for the construction sector.

All the feedstock is Australian grown, sustainable, renewable, Australian Standard certified, plantation pine.

The company employs over 600 people, largely in regional areas and is part of an extensive industry directly employing 80,000 people and a further 100,000 indirectly.

The company has two large softwood mills, one in the Tuan Forest near Maryborough QLD and one in Tumbarumba, NSW. It has two Glue Laminated Timber plants in Maryborough and distribution centres/offices throughout the Eastern Seaboard.

Reference

For a virtual tour of the Tumbarumba Mill, visit: https://www.youtube.com/watch?v=S9QUnowYM5Y

For more information on Hyne Timber, visit www.hyne.com.au

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Visit www.timberfortumba.com.au to view the short videos.

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