Debunking the Myths

Sustainable Supply of Timber

Only seven per cent of the NSW’s native forests (public and private) is currently available for timber harvesting. Over recent decades many State forests have been reclassified as National Park and are no longer eligible to supply timber (refer Figure 1).

 Figure 1 – Declining area of NSW native State Forests

Source: McIntosh (2013) The Australian native forest sector: causes of the decline and prospects for the future.
The Australian Institute Technical Brief No. 21 April 2013

Equitable Access Coastal regrowth forests are where the industry has traditionally operated, without adverse impact on the environment. However, in recent decades the vast majority of these coastal forests have been reclassified as National Parks, despite the fact that many of them are not required to meet scientific conservation objectives. The timber industry cannot be expected to remain competitive if it is only allowed to operate in steep and or rugged terrain that is remote from its processing facilities. To remain competitive, the industry needs equitable access to coastal regrowth forests.

The timber and forest products industry is a supporter of a comprehensive, adequate and representative reserve system. The industry does not however support the management of former multiple-use coastal regrowth forests as National Parks where they are not required, for ‘conservation only’ objectives. The industry calls on the NSW Government to reinstate these forests as multiple-use conservation areas which cater for selective timber harvesting.

Workable Operating Rules

Although wood resources remain plentiful, access to them is now heavily constrained by tenure and regulatory restrictions. So, in New South Wales native forests are protected from clearing and land-use change.

On land that is available for timber production, strict operating rules mean that now only around half of the forest is actually available for harvesting. Each coastal native forest operating region now has over 2,000 operating conditions which must be complied with. A huge disparity has developed between theregulation of the native timber industry and the regulation of comparable land-use activities like agriculture.

For operating rules to be workable there needs to be a balance between the needs of the environment and the requirements of a sustainable timber industry. Over the last 15 years the industry has been forced to operate in an increasingly smaller area as more and more forest is set aside to cater for site specific environmental requirements.

This has led to the areasthat remain available for harvest being harvested more frequently than they otherwise would or should be. It has also constrained the industry by reducing the ability to plan the spread of operations in time and space. In the event of changing markets or seasonal fluctuations this inflexibility comes at a direct cost to industry. Making more State forest available for timber harvesting would resolve this issue.

Fair Log Pricing

The ability of the timber industry to compete effectively in the market is dependent on its production costs being less that the price it receives for its processed timber. One of the biggest cost variables is the amount that it pays for the supply of logs. Logs delivered to a processing mill include the cost of harvesting, loading, haulage and a price for the log product (stumpage).

Native timber logs are inherently variable, given the many different species, sizes and qualities. All of these variables have a bearing on the amount, quality and type of timber that canbe recovered from them. Relative consistency in log mix is important as this determines how well processors can match their log mix with their markets and processing equipment.

Tracking trends in log quality (defect percentage) mix from State forests is an important aspect of log pricing that is not currently getting due attention.

The mix of locations from which logs are sourced is another important variable as this determines the cost of harvesting and haulage. If the average harvest and haul cost keeps increasing, logs become unaffordable. On the NSW North Coast an increasing proportion of logs are being sourced from more remote locations in more rugged terrain. Over the last five years this has led to harvest and haul price increasing by more than 20 per cent in real terms. The root cause of this problem was the transfer of large tracts of coastal State forests to National Park.

The only way to solve this issue is to transfer some of the coastal regrowth forestsback to State forest and or to adjust log stumpage prices down in areas that have higher than average delivered costs.

The Result

The decline in the area being made available for wood supply has caused a commensurate decline in production of timber (refer Figure 2) and a requirement on industry to restructure and downsize.

Figure 2 – Volume and value of logs harvested from NSW native forest by year

Source: ABARES (2013) Australian Forest & wood product statistics – Sept & Dec Quarters

The Recommendation

The following changes need to be implemented by the NSW Government to ensure a sustainable and competitive footing for the native timber industry:

• Make available a sustainable timber resource that cannot be eroded by the cumulative impacts of environmental operating rules
• Reduce the number of operating rules where environmental risk is low and making remaining rules more workable
• Achieve greater regulatory consistency and transparency with other primary industries
• Ensure log stumpage pricing is more closely aligned with log production costs and changes in log quality
• Allow greater access to coastal native regrowth forests
• Make more area available for timber harvesting to provide flexibility to move operations in time and space

Native Forest vs. Plantation Production

Wood production from native forests is relatively low cost for a number of important reasons. Unlike plantations, native regrowth forests do not require a large upfront investment to ensure successful establishment, nor do they require fertiliser, intensive cultivation or management.

Native forests must be actively managed for environmental and safety reasons whether they are used for timber production or not. Native timber harvesting is a form of active management thatcan be applied as asilvicultural tool to improve resilience against fire and to promote biodiversity and forest health.

In this context, arguably the native timber production system is more environmentally friendly. It’s more akin to permaculture than the industrial agriculture involved in plantation production of timber.

Plantations grow wood much more quickly and produce a more consistent and less defective product in a much smaller space. Plantation timbers are also less variable in terms of their quality, size and species, which makes them much less costly to harvest and process. This uniformity also makes plantation timbers better suited for use as commodity products like paper, reconstituted and engineered wood.

However plantations are susceptible to fire and, being single species, are less resilient to pests, weeds and diseases.

Hardwood vs. Softwood

It is also helpful to distinguish between hardwood and softwood plantations in assessing how feasible plantation timber is as a replacement for native timber. New South Wales has approximately 88,000 hectares of hardwood plantations and 300,000 hectares of softwood plantations.

A typical hardwood plantation takes between 35 to 40 years to reach maturity. Only a small percentage of hardwood plantations have reached commercial maturity in New South Waleswith many planted in the 1990s.

The performance of NSW’s hardwood plantations has been mixed in terms of their health, growth rates and the quality of their timber. Despite high expectations, hardwood plantations are no longer seen as a viable replacement for native wood resources. They can however be expected to supplement native wood supply in the future.

In contrast, the State’s softwood plantations are a much larger and more mature resource, producing around three times more wood than the native forest counterpart.

Industry Innovation

Over the last 20 years, the timber and forest products industry has introduced considerable innovation to overcome the limited supply of hardwood. Softwood products have made considerable inroads into structural markets that have been the traditional domain of native hardwood.

This has occurred through the production of engineered wood products and the treating of softwood timber to make it suitable for outdoor use. In New South Wales the extent of this market overlap has more or less reached equilibrium (refer Figure 3), with each industry having found its competitive space.

 Figure 3 – Relationship between hardwood forest products and plantation softwood product markets

Bioenergy is the energy stored in ‘biomass’ or organic matter and is generally produced through the process known as photosynthesis. The simplest form of bioenergy is firewood, which is used for heating and cooking. Today there are many different bioenergy applications including ethanol, biodiesel biogas, biochar, green electricity and jet fuel.

Before coal and the industrial revolution woody biomass was the world’s principle energy source. Since the beginning of recorded history the world’s forests have serviced the energy needs of society. In some developing countries there remains an issue of overutilisation in the form of deforestation and unsustainable forestry practices.

However in New South Wales all native forests are protected and there are strict regulations to ensure that harvesting of native regrowth forests is environmentally sustainable. In particular there are specific rules which govern the intensity of harvesting and protect soil, water and biodiversity.

Australia’s renewable energy target scheme has created some demand for mill wood residues that would otherwise be wasted or sold for a low value. The market however is not verystrong and there is no demand yet for forest biomass in the form of sawlog harvesting residues.

The timber and forest products industry seeks support to strengthen the bioenergy market for its woody residues and waste. Where feasible, the industry would like to see woody biomass waste and residues being value-added into products like biofuel to support jobs and regional investment.

What is Clearfelling?

Clearfelling is a forestry practice that involves the felling and clearing of an area of forest prior to it being replanted or naturally regenerated. The practice of clearfelling typically applies to plantation forests, which are of a single species and age. Like any agricultural crop, pine plantations are clearfelled when the trees reach maturity at around age 32.

Clearfelling should not be confused with land clearing. Land clearing means the permanent removal of native vegetation to make way for an alternative land-use such as agriculture, mining, roads or commercial development.

 How are NSW Native Forests Harvested?

In New South Wales, all old growth forest is protected in reserve, which means that only regrowth native forests are available for harvesting. The trees in New South Wales regrowth forests are typically mixed species and multi-aged.

Harvesting of these forests is selective. A typical harvesting event involves the removal of mature trees, usually between 50 and 80 years of age, with the retention of younger regrowth and pole sized trees. Older trees may be retained for their animal habitat value (hollows) and as a source of seed for forest regeneration.

Areas subject to selective timber harvesting typically have around one third of their tree canopy removed. This proportion will vary between sites due to a range of influences, including timber markets and forest attributes including the mix of tree species, their condition, stocking density, age and size.

Australian native forests are dynamic and have a natural capacity to regenerate and recover following disturbance events. Their capacity to recover from wildfire, wind storms, temperature extremes and drought equips them equally well to recover from timber harvesting.

Protecting Forests

Like all living things, forests follow cycles of growth, development and mortality. Along the way their development is often halted and reset by major disturbance events like bushfires and drought.

In 2002/3, 2006/07 and 2009 millions of hectares of native forests along Australia’s eastern ranges were burnt by wildfire. Most of these forests were located in National Parks. According to the Australian Institute of Criminology the 2002/3 fire spiked national emissions by an estimated 180 million tonnes of CO2-e.

The threats posed by these types of events mean that it is very difficult to manage a regrowth forest through to an old growth state and keep it protected. Active forest management is an important part of reducing the impact of these major disturbances.

Sequestering Carbon

When assessing the best way to manage forests for carbon storage it is also necessary to consider the rate that trees sequester (i.e. capture and store) carbon. In general, trees sequester carbon more rapidly when they are young, with their peak growth period typically between 10 – 30 years of age.

Carbon sequestration rates slow after a tree matures, which for a eucalypt occurs from about 80 years of age. Beyond this point the rate of sequestration flattens as carbon captured from new growth is offset by the release of carbon from parts of the tree which begin to decay and or are shed.

Sustainably harvesting trees in their early mature phase ensures that a forest’s carbon sequestration rate is kept at an optimal level. Under a sustainable harvesting regime, forests have the capacity to store more carbon over the longer term than if the forests are left unmanaged.

Wood Products Store Carbon Too

It is also important to recognise that both forests and harvested timber products provide carbon storage over the long term. Timber products have a long and stable service life, with the half-life of solid and composite wood products being up to 30 years (when used in furniture) and up to 100 years (when used in homes).

A timber framed home stores 7.5 tonnes of carbon, while a steel framed house emits 2.9 tonnes of carbon. The carbon benefits of wood also include the lower energy requirements needed to manufacture them, by comparison with alternate materials. This advantage is particularly important for the construction industry. It generally requires around 19 times more energy to make a product from steel rather than kiln- dried hardwood; 45 times more to make a plastic product; and 85 times more energy to make a comparable aluminium product.