APR 2011 - Native forest logging in Western Australia: the major companies

Submitted by WAFA on April 4, 2011 - 00:33

WA Forest Alliance  - April 2011

There are SIX companies driving the continued logging of native forests in WA. They run four large sawmills, a chipmill and a silicon smelter.  There is also a company that wants to produce ‘engineered strand lumber’ using both plantation and native forest logs, and coal-fired power stations hoping to buy native forest logs to burn as ‘biomass’.  The unique WA native forest species sought by these companies are jarrah, karri and marri.

1.  Gunns Ltd (‘Deanmill’ near Manjimup) NB: Important update below

Gunns Ltd bought three jarrah sawmills from Wesfarmers (Sotico), in 2004.  It closed the Collie mill in 2007 and the Yarloop mill in 2008 because they had become ’unviable’.  At the time the Collie mill was employing nine workers and the Yarloop mill 29 workers.  In February 2011 Gunns closed their last WA native forest operation, at Deanmill, near Manjimup stating that the quality of jarrah sawlogs provided to them had become too low.

Gunns had three contracts with the FPC, one for 90,780 tonnes of 1stand 2ndgrade jarrah sawlogs, one for 37,200 tonnes of 3rdgrade jarrah sawlogs and one for 5,000 tonnes of marri sawlogs per year.

STOP PRESS: In 2010 Gunns announced that it was pulling out of WA and would attempt to sell its Deanmill operation.  After months of speculation, no buyer was found, and in February 2011 the mill closed. The fact that no new investors were interested has sent strong signals that the native forest logging sector of the industry is no longer commercially viable and restructuring is essential.

 2.  Blueleaf Corporation Pty Ltd (jarrah sawmill, Greenbushes)
Blueleaf Corporation Pty Ltd is a timber milling operation at Greenbushes that employs 92 workers. This is the old Whittaker’s jarrah timber mill which closed in 1998. It reopened under the new owners in 2000. The new company is able to support down-stream processing companies such as timber furniture factories, etc.

Blueleaf has seven contracts with the Forest Products Commission.  The amounts, grades and species are as follows:

  • 30,245 tonnes of 1st grade jarrah sawlogs
  • 26,300 tonnes of jarrah bole residue logs
  • 5,000 tonnes of marri sawlogs
  • 3,000 tonnes of marri bole residue sawlogs
  • 9,150 tonnes of 1st grade karri sawlogs
  • 2,330 tonnes of 3rd grade karri sawlogs
  • 1,000 tonnes of karri bole residue sawlogs

3.  Auswest Timbers Pty Ltd (karri sawmill, Pemberton)
Auswest Timbers Pty Ltd was established in 1996.  It bought the Pemberton karri sawmill from Wesfarmers' forest products subsidiary, Sotico. It has two contracts with the Forest Products Commission, one for 49,600 tonnes of 1st grade karri sawlogs and one for 6,765 tonnes of 2nd grade karri sawlogs per annum.  It manufactures timber products ranging from large heavy structural sections, floor joist, roofing timbers and roof tile battens. Value added kiln dried and dressed products include floor boards, decking, veneer and furniture timbers.

The company’s output is sold in all Australian states and overseas to countries including the United Kingdom, New Zealand, South Africa, Indonesia, Korea, Holland, Canada and the United States. (Auswest website)

4.  Australian Craftwood and Timbers Pty Ltd (marri and jarrah sawmill, Manjimup)
Australian Craftwood and Timbers Pty Ltd is a family-owned company based in Queensland.  It began operations in WA in 2004 and now buys 15,000 tonnes of lower grade jarrah sawlogs and 111,600 tonnes of marri residue logs per annum from the Forest Products Commission.  

It produces products ranging from high grade furniture boards and flooring blanks to railway sleepers for the Australian and export markets.  (Australian Craftwood and Timbers Pty Ltd website)

5.  M&B Sales Pty Ltd (jarrah sawmill, Nannup)
Nannup Timber Processing Pty Ltd is an associated company of M&B Sales Pty Ltd, which bought the company from Sotico in 2001.  It has a contract with the Forest Products Commission for 26,300 tonnes of 1st and 2nd grade jarrah sawlogs per annum. It produces jarrah for flooring, furniture components and other pre-dressed and finish dressed products for local, east coast and export markets. (NTP website)

6.  WA Plantation Resources Pty Ltd (chipmill, near Manjimup)
The Bunnings Group originally established two operating companies, WA Chip & Pulp Co Pty Ltd (WACAP) in 1969 and WACAP Treefarms Pty Ltd in 1990. WACAP export woodchips produced from bluegum plantations managed by WACAP Treefarms and State karri forests.  In 2000 Marubeni Corporation of Japan acquired these companies and formed WA Plantation Resources Pty Ltd (WAPRES), which is the holding company for the woodchip and plantation business. WAPRES is currently 50% owned by Marubeni Corporation and 50% by Nippon Paper Industries Co Ltd. WAPRES has woodchip exports of around one million tonnes per annum and over 30,000 ha of plantation under management. (WAPRES website)  

The Forest Products Commission has a contract of sale with WAPRES for 130,000 tonnes per annum of large and small karri chiplogs, produced from clearfelled mature karri forest and thinned karri regrowth.

7.  Simcoa Operations Pty Ltd (silicon smelter, near Bunbury)
Simcoa Operations Pty Ltd, owned by Shin Etsu Corporation of Japan, uses jarrah as a cheap ‘reductant’ in silicon processing at its silicon plant at Kemerton, near Bunbury. Under a State Agreement Act, Simcoa has the right to buy up to 150,000 tonnes of jarrah charcoal logs per annum from the Forest Products Commission.  Since 2000-1, it has bought on average 75,000 tonnes per annum of dry jarrah charcoal logs.  It buys less jarrah under the State Agreement Act because it gets wood waste from Alcoa’s bauxite mine sites.  Simcoa also buys jarrah sawmill residue from Gunns and other sawmills.  The stumpages for charcoal logs are tied to the international price of silicon and last year fell by 20%.  

Simcoa has begun a major expansion, which could have serious implications for the jarrah forests.

Three major new threats

8.  Lignor Limited (engineered strand lumber plant, near Albany)
Lignor Limited has all necessary approvals to build an engineered strand lumber plant near Albany. Two-thirds of the feedstock would come from plantations but it also has a contract with the Forest Products Commission for 360,000 tonnes of low grade jarrah, marri and karri logs per annum.  The project is on hold awaiting finance.

9.  Griffin Power Pty Ltd (coal-fired power station, near Collie)
The Forest Products Commission has conducted ‘total extraction’ logging trials to determine how much ‘biomass’ is available.  As a result it has offered to sell Griffin Power Pty Ltd up to 400,000 tonnes per annum of ‘low grade’ jarrah and marri logs to burn at Bluewaters coal-fired power station, near Collie.  Other companies have expressed interest in buying native forest logs to burn as biomass.

10.  Biomass Pty Ltd (wood-fired power station, near Manjimup)
Biomass Pty Ltd, a subsidiary of Babcock and Brown, has all necessary approvals to build a wood-fired power station at Diamond Mill, near Manjimup.  It would use only plantation feedstock but it remains a potential threat to native forests, especially as it would be located on the site of the WACAP woodchip mill, at the centre of a network of logging roads that extend throughout the karri forest.  The project has stalled because of Babcock and Brown’s financial difficulties.

Important statistics
Australian forest and wood products statistics (ABARE), September and December quarters 2009, 25 May 2010, show that in 2009 in WA there were:

  • 311,800 ha of broadleaved plantations (almost entirely privately-owned Tasmanian blue gum for export woodchips); and
  • 110,900 ha of coniferous plantations (almost entirely FPC owned and mostly radiata pine with some pinaster).

In 2008-09, WA produced:

  • 495,000 m3 of broadleaved native forest logs;
  • 2,590,000 m3 of broadleaved plantation logs;
  • 1,009,000 m3 of coniferous logs (all plantation).

Only 12% of WA log production came from native forests; 88% came from plantations.

In 2007-8, WA produced:

  • 99,200 m3 of broadleaved sawnwood (almost entirely native); and
  • 220,800 m3 of coniferous sawnwood (all plantation).

Only 30% of sawnwood produced in WA came from native forests; 70% came from plantations.

The same report shows that in 2009 WA exported sawnwood (both broadleaved and coniferous), logs and woodchips.  WA also exported medium density fibreboard (MDF).

WA Forest Alliance - April 2011