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Category: Timber / Industry / States and Territories / Environmental Management / Environmental Impact / Environment

What's happening to Australia's largest hardwood mill?

Thursday, 16 Mar 2017 09:12:16 | Peter Lusted

The mill has asked the State Government to fund a $40 million refit. (Facebook: Australian Sustainable Hardwood)

The fate of 250 workers at Victoria's Heyfield sawmill is likely to be decided tonight, when the board of Australian Sustainable Hardwoods (ASH) meets to consider whether to close the mill down.

250 workers would lose their jobs as early as September if the mill closes, and locals say the Gippsland town would struggle to survive without it.

The largest hardwood mill in Australia processes native regrowth timber supplied by the state-run logger VicForests, but its long-term contract is up in June.

The company claims a three-year supply deal offered by VicForests — which would have halved the amount of timber supplied to the mill - is not financially viable.

VicForests made a new offer to ASH on Tuesday afternoon, but the details of that offer are not yet known.

What's the problem?

Sawmill at Heyfield in Victoria's east Photo: The mill has asked the State Government to fund a $40 million refit. (Facebook: Australian Sustainable Hardwood)

Under its current contract, ASH processes about 150,000 cubic metres of timber each year.

But VicForests says timber supply is dwindling and the current level of production is unsustainable.

It offered the Heyfield board a three-year deal to supply 80,000 cubic metres of timber in the year from June 2017, and 60,000 over the next two years.

In January, ASH said the offer was not viable.

VicForests is required by legislation to manage the state's forests sustainably, and it told the company it could not supply so many trees.

The Wilderness Society insisted the previous levels of logging were not sustainable.

External Link: Wilderness Victoria tweets: "Change is inevitable due to #bushfire & decades over logging both of which are impacting #forests & wood resource"

But the Chief executive of ASH Vince Hurley argued the timber was there, but has been locked up in reserves to protect endangered species, such as the Leaderbeater's possum.

"At the moment in public forests in Victoria, 94 per cent of forest is not able to be touched," he said.

"So 6 per cent we're in … and one eightieth of that 6 per cent is harvested and regenerated per year.

"Progressively more and more reserves have been created, so that has eaten into that 6 per cent."

Could the mill stay open?

The company has said it would need at least 130,000 cubic metres of timber a year for the mill to be viable, but it has also sought a long-term contract to secure its future.

Additionally, ASH has approached the State Government for a $40-million-dollar handout to retool its mill.

Heyfield saw mill Photo: The future of 250 jobs hang on the outcome of the new offer. (ABC News)

The company said changing its equipment would allow it to move away from processing 1939 regrowth timber and begin working with newer, smaller logs.

It said the investment would allow it to switch to plantation timber within 20 years.

The negotiations have been a tough balancing act for the State Government.

It wants to prevent further job losses in the area as 750 will be lost at the end of the month due to the closure of the Hazelwood Power Station in the Latrobe Valley.

More than a hundred workers on the steps of Treasury building Melbourne. Photo: More than 100 mill workers came to Melbourne to rally for the mill's cause. (ABC News: Stephanie Anderson)

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