Deanmill can't reliably reopen

MEDIA RELEASE

Monday 5 September 2011

Not enough jarrah to sustain sawlog industry – Deanmill can’t re-open

The WA Forest Alliance (WAFA) has warned potential investors in native forest logging in WA to recognise that this industry has no future and to invest their money elsewhere.

Auswest Timber Pty Ltd, which owns the main karri sawmill, in Pemberton, is considering buying Deanmill, Gunns’ jarrah sawmill near Manjimup.

WAFA spokesperson Jess Beckerling said, “The State Government’s reluctance to provide Auswest with a guarantee that it will continue to supply jarrah sawlogs is well founded.

”Gunns closed Deanmill, its 3^rd and last jarrah mill, because there is simply no longer enough good quality jarrah to sustain a sawlog industry in this State.

“A confidential report prepared by consultants URSfor the Forest Products Commission in 2008, “Native hardwood supply chain study,” said that the return on capital was less than one per cent in the major jarrah sawmills.

“After 150 years of overcutting and mismanagement, WA’s native forests can no longer support a logging industry.

“The excuse that logging is for good quality sawlogs for value-added products has been exposed for what it is:  a smokescreen to allow logging to continue for low-value products like railway sleepers, woodchips and charcoal.

“The State Government has given eight sawmills Investment Security Guarantees (ISG) promising them millions should there be any reduction in the amount of native forest sawlogs supplied to them. If all the sawmills succeeded in their claims, taxpayers would have to fork out $77.25 million.

“The compensation is payable if the reduction is due to a change in government policy.  There are however two exceptions.  No compensation is payable if the change in government policy is influenced by climate change or by an increase in the estimated spread of dieback.

“Any company thinking of buying Gunns’ Deanmill sawmill should look carefully at the ISG contract.

 “A May 2011 report prepared for the South West Development Commission recognised that

         The current Forest Management Plan (FMP) expires in 2013 and industry stakeholders are          pessimistic about the likelihood of any increase to the current level of sustainable yields. Existing industry participants, and any potential investor, have supply contracts for two        more years but no indication of the available resource volume beyond 2013. It is          understood all possibilities are available including a zero allocation. [emphasis added]

"For economic reasons alone, it is time for all logging of native forests to stop and for WA's native forests to be protected," she concluded. 

 Further comment contact Jess Beckerling 0488 777 592