NSW’s Native Forest Logging Industry Operating at a $29M Loss

 

The NSW Government is under pressure to re-evaluate native forest logging after the latest Forestry Corporation Annual Report found its native logging division is operating at a significant loss.

The Forestry Corporation’s latest annual report has revealed that the hardwood division, which manages native logging, operated at a $29 million dollar loss in 2022/23 financial year. In response, the independent regulator NSW Independent Pricing and Regulatory Tribunal (IPART) recommends shutting down the industry by 2028.

Environmentalists are also calling for the Forestry Corporation to follow in the footsteps of Victoria and Western Australia and shut down its native logging industry. This would leave Tasmania as the only state to continue logging native forests.

‘In the last four years, the NSW Government-owned logging company has lost over $70 million logging NSW native forests, has been prosecuted multiple times, and fined over $1.5 million for breaking environmental laws’, says Justin Field of the Forest Alliance NSW.

IPART’s regular analysis of the industry found that the losses were due to the native timber division selling timber to sawmills for less than the cost it took to supply it. Current contracts with these set prices are set to expire in 2028, and if renegotiations don’t table an economically viable outcome, the feasibility of native logging should be reviewed.

There was an 18% loss increase per tonne of wood delivered to sawmills since IPART’s last review, from $3.96 per tonne to $4.67.

‘This report now shows for the last decade it has not even been recovering the costs of logging and transporting timber under existing contracts’, says Field.

There are calls to end native forest logging in NSW | Photo by Owen Hanson

The Environmental Impact of Native Forest Logging

Conservation groups have been calling for native forest logging to end for years, due to its destruction of habitat, particularly for endangered animals such as koalas in locations like Tuckers Nob State Forest.

There are also concerns that logging makes bushfires worse. In fact, the Forestry Corporation’s Annual Report mentions the regulatory changes and safeguards it’s had to invest in for the protection of native wildlife, and attributed part of its losses to covering these costs.

Earlier in the year, native logging garnered the attention of federal minister, Dr Sophie Scamps, who started a petition to have native forest logging banned across the country. The petition currently has over 16,000 signatures.

The Economic Cost of Ending Native Logging

Industry lobbyist, James Jooste, CEO of the Australian Forest Product Association (AFPA) NSW told the ABC, ‘This is a critical industry … for our housing, energy, manufacturing, and mining sectors … timber is the workhorse of the economy’.

However, Field admits this is an opportunity to shift the industry to a sustainable plantation-based future. ‘For every year native forest logging is allowed to continue taxpayers will continue to foot the bill’, he says.

Deforestation is destructive to our planet and native wildlife | Photo Thanks to Owen Hanson

Dailan Pugh from the North East Forest Alliance said, ‘The NSW Government needs to heed the advice of IPART that there are concerns about native forestry. NSW needs to stop paying to degrade public native forests and instead profit from them being managed for wildlife habitat, recreation, tourism, water, and their essential service of carbon capture and storage’.

We’ll be keeping a close eye on the outcomes of the recommendations.

Feature image by Friends of Tuckers Nob Facebook Group