The element: an endangered saw-milling business

Podcast: the element

Our sawmills are closing – and business chief says it is a violation of our duty to future generations

The specter of closure of the Whakatāne plant has put the struggling timber business again within the headlines, with requires pressing motion to forestall additional shutdowns.

“This can be a violation of our duty to future generations,” says David Turner, govt director of Sequal, a Kawerau wooden processing plant that employs 80 folks.

He predicts that extra factories with particular enterprise and product issues will shut, “however the true issues are going to begin exhibiting in about 5 years.”

Right now Turner explains to The element why the timber processing business is beneath stress and why New Zealand continues to ship so many uncooked logs to China with out turning them into one thing extra beneficial.

Forestry is our third largest export, in keeping with MPI, with annual income of over $ 6.7 billion.

Most of those exports are logs, and between 70 and 80 % of those are destined for China.

Since 2008, log shipments to China have elevated from a million tonnes per yr to round 20 million this yr.

On the identical time, our exports of value-added timber have stagnated.

Turner says the federal government has an “phantasm that we will entice international capital as a result of the elemental drawback is the dearth of capital. There is no such thing as a lack of capital, there’s a lack of capital. surroundings to make this capital environment friendly and affluent “.

In contrast to the Whakatāne mill, the Turner’s Sequal manufacturing facility simply 33 kilometers away is “definitely not in misery”.

“What I might say is that there must be 10 corporations like Sequal in New Zealand, not only one.”

Sequal, which employs 80 folks, is owned by 4 households in Bay of Lots. It’s the solely sawmill in New Zealand that focuses on processing utility grade logs, competing particularly with the identical logs despatched to China. As a major producer, it processes bulk timber for patrons in 20 international locations, which then remodel it right into a completed product resembling furnishings.

Turner explains that almost all logs in New Zealand are of utility grade, therefore the necessity for a processing sector in New Zealand able to taking decrease grade fiber from utility grade log and processing it into product.

However the wooden processing business is struggling due to the distorted log commerce, he says. The argument is that China prefers to import logs to course of wooden as a result of it needs to create manufacturing facility jobs for its personal folks. To help this coverage, it affords VAT rebates, vitality and electrical energy subsidies and free transport to business.

Turner explains to The element what wants to vary to make the sector extra viable and talks about what number of occasions he thinks the business is making progress with the federal government – solely to be disillusioned.

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