With high demand, insufficient supply and a logging ban, WA’s forestry industry could be facing the perfect storm.
Record high demand driven by a strong construction sector, coupled with constraints on supply, have put the squeeze on an already under-pressure forestry industry.
That threat became more pronounced six months ago, when the state government announced a ban on native forest logging by 2024, bowing to pressure to make the industry more sustainable.
The state’s move was questioned by industry, given the Forest Product Commission’s own annual reports, endorsed by Forestry Minister Dave Kelly, claimed hardwood logging in Western Australia met the strictest environmental standards and was considered sustainable by internal and external experts.
Since then, businesses in the timber sector have been dealing with the fallout and workers have been leaving the industry en masse, an issue compounded by the state government’s industry closure incentives.
In February, the industry was dealt another blow after a fire burned a 200-hectare plantation and a timber treatment business in Bridgetown.
The building boom, underpinned by COVID stimulus packages, led to unprecedented demand for structural timber, with more than 90 per cent of the Master Builders Association WA’s members experiencing cost increases and supply issues that threatened to delay projects.
In response, the state government agreed to raise its timber harvesting quota by 12,000 tonnes for three months.
The state’s peak forestry industry body claims it has asked the government to do more to address supply and timber business viability issues but has had little response.
Forestry Industry Federation WA chief executive Adele Farina warned the supply issues would get markedly worse following the decision to end native forestry.
“Without skilled and experienced workers to harvest timber, supply to mills has dramatically decreased,” Ms Farina said.
“Similarly, with key skilled operators leaving the industry, mills are struggling to operate at optimum levels even with reduced timber volume.
“Furniture manufacturers are already reporting price increases of up to 50 per cent and difficulty sourcing timber.”
For hardwood, Ms Farina put the issue down to the state’s own Forest Product Commission’s inability to supply sawlogs to mills.
Business News understands mills were told last year the FPC could not supply the contracted volume of jarrah sawlogs and followed with volumes reduced by up to 70 per cent.
However, Ms Farina said mills were reporting the FPC was failing to meet even those substantially reduced volumes.
Softwood supplies are also in doubt, with 12 per cent less area allotted to pine plantations across the state now than 20 years ago.
FPC Business Services director Andrew Lyon acknowledged that capacity issues in the native forest industry coupled with low yielding jarrah coupes had made deliveries to native forest customers challenging.
“The FPC is actively working with industry stakeholders to minimise supply disruption and increase delivery volumes to customers,” he said.
“Initiatives include working with contractors to trial new harvesting procedures in an effort to increase production efficiency and exploring ways by which haulage contractors can share information to increase delivery volume and minimise inefficiency
“After the state government’s announcement to end logging of native timbers at the end of the current Forest Management Plan (FMP), the forestry industry requested almost double the timber volume for 2022 than was delivered in any previous year of the current FMP.
“The capacity to harvest and deliver this increased amount of timber simply does not exist in the industry.
“Strong regional employment and a general lack of some trades across all sectors has also contributed to capacity constraints for harvest and haulage in the industry.”
Mr Kelly rejected claims the logging ban had resulted in any impact on softwood timber used in construction.
In fact, he claimed it had had the opposite effect, with the state government’s $350 million commitment to expanding softwood plantations over the next decade having provided confidence to the pine industry.
Mr Kelly pinned the current softwood supply issues on poor planning and inadequate investment in the state’s softwood estate by the previous Liberal-National government.
While every effort had been made to utilise available timber, Mr Kelly said bringing forward the harvest of trees came at a cost, and it was about striking the right balance between supplying the current demand and not compromising future timber supply.
“The Forest Products Commission has increased pine supply where possible to help address the short-term issues being faced by the construction industry,” he said.
“This expansion will provide for at least an additional 33,000 hectares of softwood plantations and will create opportunities to build partnerships with landowners and the private sector to enable the establishment of additional plantation areas.
“The expansion will return the softwood plantation area to its historical levels.”
While the plantation expansion was welcomed by industry, Ms Farina highlighted that softwood and hardwood were not interchangeable and that the expansion alone was not sufficient.
She said the answer was the continuation of sustainably managed forests, the establishment of plantations through a state planning policy, and government departments with large vacant landholdings making them available for plantations.
“The government can fix timber supply shortages,” she said.
“But, blinded by its announcement to cease native forestry, [it] is hoping the problem will resolve itself; but it won’t.
“Sustainably managed forests are the answer to supply issues and to meeting the growing demand for timber.”