State Government grants have helped to kick-start private investment in Western Australia’s timber industry, with $23 million being spent on two new projects at Collie and Greenbushes.
State Government grants have helped to kick-start private investment in Western Australia’s timber industry, with $23 million being spent on two new projects at Collie and Greenbushes.
Bassendean company Pinetec is proceeding with a $16 million sawmilling and manufacturing centre at Collie, while Whittakers Timber Products is planning to spend more than $7 million on new processing equipment.
Several smaller projects, including an upgrade of the Nannup timber mill and Australian Craft-wood and Timbers’ new sawmill at Manjimup, are also proceeding with Government support.
A notable exception to this pattern is listed company Gunns, which is using its own money for a $4 million upgrade of the timber mills it bought earlier this year from Wesfarmers subsidiary Sotico.
Pinetec is establishing an integrated sawmilling and pallet manufacturing plant adjacent to Western Power’s Muja power station.
The project has been designed so that Pinetec can buy low-cost energy, while Western Power will buy 78,000 tonnes of sawmill residue each year, reducing its coal consumption by 45,000 tonnes.
Premier Geoff Gallop said it would be WA’s biggest biomass co-firing operation and an excellent example of sustainable development. The project has gained substantial Government backing, with the State Government directly contributing $2 million and Western Power providing the land.
Western Power will spend a further $3 million on infrastructure and a conveyor for the pine waste.
The project will create up to 50 jobs in Collie, though this will largely be offset by lower employment at Pinetec’s Bassendean mill.
At Greenbushes, Whittakers is spending $7.5 million installing specialist equipment from France that will enable it to process small logs previously treated as waste.
“It’s to process very small logs that the industry has never had the technology to process before,” Whittakers director Trevor Richardson said.
The new equipment will be able to process logs down to 12.7 centimetres (five inches) in diameter.
Mr Richardson said the investment in new equipment was underpinned by a sales contract with Swedish company Khars, which will use the small sections in the production of laminated flooring.
“We’ve been supplying them for about four years but they couldn’t get sufficient volume,” he said.
Mr Richardson said some of the output could also be used in furniture manufacturing.
Whittakers presently employs about 100 staff and Mr Richardson said the new investment would allow it to take on a further 35 staff.
The State Government is contributing $2.2 million to the Whittakers project.
This followed a $3.2 million grant in 1999 to help with the re-opening of the Greenbushes mill.
As at Whittakers, the new equipment being installed by Nannup Timber Processing and Gunns is primarily designed to help the companies process smaller sized logs.
This trend has been driven by cutbacks to old growth logging, which has limited the availability of larger logs and forced the industry to find alternatives.
Private Manjimup company Australian Craftwood and Timber is establishing a new $3.5 million timber mill to process low-grade jarrah.
Government backing has been even more important for this company than most other timber millers. It has obtained $1.6 million from the State Government and $1 million from the Federal Government, leaving the project backers to invest less than $1 million of their own money.
The Federal money was part of a $15 million pre-election package, through which 50 South West businesses have obtained government grants. Whittakers and Pinetec also received Federal grants, which went to a range of harvest contractors, timber millers and furniture manufacturers.
