Forestry is one of the most disrupted industries in the country. On top of the challenges facing all heavy industry – the high dollar, international competition, falling commodity prices and relatively high cost base – the $7.5 billion timber industry faces specific difficulties at the heart of its business model.
~~
Tasmanian forestry giant Gunns is the most celebrated victim, although, in truth, most of the industry is under stress, or if you are being polite, ”in transition”. And there is likely more pain to come.
~~
While the falls in Victoria and NSW are large, nowhere has the collapse in the native timber industry been more dramatic than in Tasmania.
At its height last decade the state was processing more than 5 million cubic metres of native timber. In 2012-13, as exports to Japan collapsed, a little under 800,000 cubic metres was processed.
That plunged Forestry Tasmania to operating losses of almost $30 million a year. The bleeding has been stemmed courtesy of a government lifeline, but the future of the state’s industry is under another cloud.
