Japan on board

PLANTATION timber investment manager Great Southern Plantations has put pen to paper on a lucrative contract with a leading Japanese company for the export of hardwood woodchips, worth more than $130 million. The chips will be exported from the port of Albany, where only last week a Timbercorp Ltd/ITC Ltd join venture opened a major woodchip export facility, which will significantly increase the port’s role in the growing export market for plantation timber. The five-year contract will run from 2007 and will result in the export of approximately 1.5 million tonnes of woodchip. The buyer is Itochu Australia Ltd, a major trading company, with the ultimate user being one of the largest paper manufacturers in the world. Great Southern managing director John Young said the company was delighted to have secured the contract, which was the culmination of a long-term relationship with Itochu. “It effectively means that all the resource from our first six projects in the Albany region have been contracted,” he said. The contract is on a Free on Board (FOB) basis, which means the sale is actually made when the chip is loaded into the ship’s hold, allowing better prices for produce.