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Tasmania's forestry debacle

By Mark Poynter - posted Friday, 24 August 2012


Nevertheless, these attacks have ultimately helped to create a market demand for FSC-certification that the Australian hardwood industry simply cannot meet because our ENGOs are themselves the gatekeepers of the FSC scheme in Australia and therefore control who can or can't be certified.

It is unclear whether customers, banks or shareholders lobbied by these 'brand mailing' campaigns actually believe ENGO's claims or simply make a pragmatic decision to cut ties with targetted companies to disassociate themselves from a controversy. Either way it is apparent that in this case, these campaigns have effectively sabotaged key markets for Tasmanian hardwood products.

Ultimately, this contributed to Gunns' loss of its traditional Japanese woodchip customers and substantially reduced the company's revenue by forcing it to sell into less lucrative markets. This, together with the Wilderness Society's efforts to poison Gunns' reputation amongst its bankers and largest shareholders, helped foster the climate that enabled self-styled 'corporate eco-warrior' Geoffrey Cousins to engineer a boardroom coup in May 2010. This claimed the scalps of two of Gunns' Tasmanian-based directors, including Chairman, John Gay, a 37-year industry veteran who was the company's public face.

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Cousins was largely inspired to act by deceitful ENGO campaigns which misrepresented Gunns' proposed pulp mill as a grave threat to Tasmania's 'old growth' forests and iconic endangered species, such as the Wedge-tailed Eagle. In reality, the pulp mill was planned as a facility that would initially draw its resource from a mix of native regrowth and plantations before fully transitioning to plantation wood within five-years.

Arguably, if John Gay had remained as Gunns' Chairman, it is unlikely that the company would have acted knowingly in ways which would severely damage the rest of the native hardwood sector, but the revamped Gunns board and its new Managing Director, Greg L'Estrange – a noted 'change agent' with no special affinity for timber industries – clearly had no such compunction.

Soon after his appointment, L'Estrange announced that Gunns would relinquish their forest harvesting rights and close their native hardwood division to concentrate on plantation-grown products. Concurrently he, in conjunction with a prominent ENGO activist, effectively initiated the so-called 'forest peace' process ultimately aimed at facilitating the construction of the company's proposed pulp mill. As by far the largest and most dominant player in Tasmania's native hardwood industry, Gunns' self-serving behaviour dragged the rest of sector unwillingly into a process which threatened their future.

Before long, Gunns had closed their woodchip export facilities to the remaining native hardwood players. Then, in June 2011, in what appeared to be a deliberately provocative indignity, they sold their Triabunna woodchip mill and port facility to a pair of mega-wealthy 'green' entrepreneurs despite their purchase offer being 40% lower than a competing timber industry consortium.

Unsurprisingly, under their 'management' the Triabunna woodchip facility has remained closed ever since. This has severely hampered the remaining timber industry in Tasmania's southern forests by deliberately denying it access to its traditional market outlet for forest and sawmill residue. As these residues can no longer earn an income the economic viability of the industry has been badly damaged.

This problem could have been addressed by developing a market for woody residues as a source of renewable biomass energy – a proposal that Forestry Tasmania was already working towards. However, on two seperate occassions the Australian Greens have stymied attempts to include the use of biomasss from native forest harvesting and sawmill residues in Federal renewable energy legislation. Clearly, their ideological determination to ultimately end native forest wood production exceeds their committment to the improved environmental outcomes that could be achieved through increased generation of renewable energy.

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Further to this, the two-year delay associated with the 'forest peace' process has created market-place uncertainty and prevented the industry from exploring and developing relationship-based market opportunities. This situation has also restricted access to capital markets thereby preventing investments in new approaches, new technologies and new markets and products. In effect, this has meant that the industry has gone backwards whilst waiting for an outcome.

The spin attached to the 'forest peace' process is that if it results in an agreement being reached, it will 'secure the future for Tasmania's forest industry'. At best this will be a significantly attentuated future based on a substantially reduced resource base. Also, given that this future can only be secured by the industry agreeing to relinquish most of it's legally enshrined harvesting rights in return for an ENGO promise to stop sabotaging its markets, it smacks of extortion.

To this can be added blackmail, given the Federal Government's determination to force a resolution by making hundreds of millions of dollars in industry compensation and regional development grants contingent on the industry agreeing to effectively sign away much of its future to facilitate new national parks. The Federal Government's involvement in what should be a state responsibility has been troubling, but seems to be linked to an agreement that Julia Gillard made with then Greens Leader Bob Brown in 2010 to garner the support she needed to become Prime Minister.

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About the Author

Mark Poynter is a professional forester with 40 years experience. He is a Fellow of the Institute of Foresters of Australia and his book Going Green: Forests, fire, and a flawed conservation culture, was published by Connor Court in July 2018.

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