Cameron Hindrum

I took a peek at the Draft Integrated Impact Statement tendered by Gunns Ltd to the RPDC in support of its proposed pulp mill. I will admit here and now that I have no intention of perusing this tome in its entirety, chiefly because there are much better examples of fiction gracing my bookshelves with which I would much rather indulge my quiet moments. However, like someone slowing down as they pass the scene of a major traffic accident, I am morbidly curious. Just what does $11 million and 350,000 hours of labour — half an average human lifetime — by the industrious denizens of the Cimitiere St Citadel result in?

OKAY, on Sunday evening I relented.

I could resist no longer.

I took a peek at the Draft Integrated Impact Statement tendered by Gunns Ltd to the RPDC in support of its proposed pulp mill. I will admit here and now that I have no intention of perusing this tome in its entirety, chiefly because there are much better examples of fiction gracing my bookshelves with which I would much rather indulge my quiet moments. However, like someone slowing down as they pass the scene of a major traffic accident, I am morbidly curious. Just what does $11 million and 350,000 hours of labour — half an average human lifetime — by the industrious denizens of the Cimitiere St Citadel result in?

Having navigated my way to the Gunns pulp mill site, I cast my eyes over the list of download options, the draft IIS laid out in forensic detail, piece by exhaustive piece. One such piece grabbed my attention and it was this that I allowed into my computer, and which, having read it, I will immediately delete. (I paid a reasonable amount of money for my computer hard drive and I don’t want it catching anything, least of all a nasty case of rampant capitalism.) It was headed ‘Justification for the Project and the Consequences of Not Proceeding’. I believe its Vol. 1, Part 3 of the draft IIS. (Of course, the fact that this 7500 page behemoth should be referred to as a draft is highly absurd, for many good reasons.)

Among other things, in this section it is stated that: “Value-adding and the production of more complex differentiated products are important for economic growth…they result in less sensitivity to exchange rate fluctuations and price competition than the simpler commodity product (woodchips).”

Little gem of economic wisdom

This claim is directly contradicted by the recent report issued by Commsec, which stated that the mill would never be cost-competitive, and provided no guarantees of security given the volatility of the global market for pulp. The same report stated that the mill was financially risky and dangerous, as reported in The Mercury on May 31. As other recent posts on Tasmanian Times have shown, Gunns’ current share price values the company at about $850 million, which widens the gap between its financial security and the capital needed ($1.4 billion or thereabouts) to proceed with this development.

However, what I found really really interesting was this little gem of economic wisdom, in Volume 1 Section 3.2 (Consequences of the Project not Proceeding): “The alternative to establishing a pulp mill is a ‘do nothing’ option, that is, continue to export woodchips to international pulp mills for processing.”

This, I’m afraid to say, is patent rubbish. It also allows me to demonstrate where Gunns Ltd have succeeded in shooting themselves emphatically in the foot.

There is, firstly, an alternative to the pulp mill that allows for value adding in timber resource production. It was aired in 2004 and largely ignored at the time, perhaps because it makes some fiscal sense, didn’t consume large amounts of public money to get its message across and doesn’t involve an immediate and long-term threat to several Tasmanian ecosystems through the dispersal of dubious effluents and so on. Oh, and it was generated by the Tasmanian Greens.

As part of their Forest Transition Strategy, the Greens drew up an alternative model for timber processing; a summary of this strategy is here: http://tas.greens.org.au/publications/other/FTS-IN_BRIEF.pdf This alternative model proposes the establishment of a range of sawmills (eight in all) which would create 720 net jobs* in the Tasmanian timber industry. The capital expenditure required for this project is about 25% less than that required by the pulp mill, and would require a million less cubic feet of timber per year. “A pulp mill,” the FTS document states, “is not in the best interests of Tasmania’s strategic direction. It would continue Tasmania’s ‘quarry mentality’ as a price-taking undifferentiated commodity producer. This is the opposite of making high-quality low-volume goods for the world’s top niche markets–and it returns less jobs for more wood and more investment than the other options.”

*I regard employment figures Gunns has projected for its pulp mill, which are in the low thousands, as rather dubious; in the section of the draft IIS I refer to here a figure of 1,617 is mentioned, ‘sustained on average during the operating phase of the project’. By comparison, a mill in Valdivia, Chile, employs 300 people, of which 20 are locals (and apparently they “clean the toilets”). More information on the CELCO Mill, which was visited by members of the Pulp Mill Task Force, is here: http://bobmcmahon.blogspot.com/ and makes very interesting, if not disturbing, reading. I can only begin to wonder how the discrepancy between these two figures, 1,617 and 300, can be explained away by pulp mill proponents.

Why is bigger better?

In addition, continuing to export woodchips to international mills should not be labeled a ‘do nothing’ approach, as this practice has resulted recently in downturns in demand for log supply, which in turn meant abandoning contracts with loggers, which Gunns did without hesitation — certainly with no hesitation for the onflow effects on the families of those suppliers who were faced with a sudden loss of income. It would be to much to suggest that if the pulp mill does not go ahead, Gunns might reconsider its high-volume, low-return export strategy. Which would amount, of course, to ‘doing something’.

But there’s the thing, Readers: why is Gunns Ltd’s proposed pulp mill more viable, more beneficial, than the alternative set out in the Forest Transition Strategy? I suppose a more direct question is — why is bigger better? Especially when it contains even a minimal risk to the environment through particulate and effluent discharge, and not even taking into account the issues of resource security, transport, and so on? I might suggest one reason why. How could the Greens, those pesky lefty beanie-wearing tree-hugging hippies, possibly have a better, more viable, more responsible concept for the use of this state’s ‘greatest natural resource’ ((draft IIS, Vol. 1 3-104)? By alienating themselves and their supporters from viable alternatives — or indeed any alternative at all — the credibility of the pulp mill’s proponents is exposed to question. Through a disproportionate level of taxpayer-funded support and by dint of their own resources and capital, Gunns Ltd have built a myth for themselves that suggests the pulp mill represent the only way forward for the Tasmanian economy.

I have to assert that this is not so. I don’t expect the blinkers to come off, but I don’t accept the propaganda either. I suppose it has always been thus in Tasmania, where our environmental heritage is concerned. The big end of town has all the answers, which of course is convenient when they are given free rein to ask all the questions.

Cameron Hindrum lives and works in Launceston. He is an advocate for the Arts and the Environment and has had short fiction and non-fiction published in Famous Reporter, Island, Forty Degrees South, Pendulum, Paradox and elsewhere on www.oldtt.pixelkey.biz/.